Volvo Aero Engine Services lands overhaul order valued at SEK 500 million

VOLVO AERO ENGINE SERVICES LANDS OVERHAUL ORDER VALUED AT SEK 500 MILLION Volvo Aero has signed an agreement with Pratt & Whitney whereby Volvo Aero will overhaul about 25 Pratt & Whitney JT9D engines, for Boeing 747s among other aircraft. The value of the contract is estimated at about SEK 500 M covering 2001- 2002, making it the largest overhaul contract signed by Volvo Aero since 1998. The background to the agreement, which was signed on Thursday (October 18), is the result from current and anticipated high workload on PW4000 engines in Pratt & Whitney's own workshops. After having reviewed the performance of other engine service companies, it was decided to assign the overhaul of a number of JT9D engines to Volvo Aero. "The new agreement covers 2001 and 2002. The exact number of engines for overhaul is not specified in the contract, but we are planning for about 25," says Bertil Hallin, President of Volvo Aero Engine Services in Bromma, Stockholm, where the JT9D engine is serviced. No new recruitment is anticipated as a result of the contract. The cost for overhaul of a single engine is between SEK 20 to 30 M, depending upon the extent of the service. "A rough estimate is that it will involve about SEK 500 M," says Bertil Hallin. "We are certainly very pleased that Pratt & Whitney is showing its confidence in us. It is also pleasing for us that the agreement is in line with our strategy to expand within the JT9 overhaul segment," comments Lars Sundberg, Senior Vice President and Manager of the Engine Services business area at Volvo Aero. "The agreement increases our possibilities to achieve our production goal, despite the acute crisis in the aviation industry. "We are pleased to have signed an agreement with Volvo Aero," says Jean- Louis Berrendonner, Senior Vice President, Large Commercial Engines, Europe, at Pratt & Whitney. "It means that we can continue to guarantee our customers high-quality engine overhauls. October 19, 2001 For further information, please contact: Fredrik Fryklund, manager media Relations, +46 520 94 401 The Volvo Group is one of the world's leading manufacturers of trucks, buses and construction equipment, drive systems for marine and industrial applications and aircraft engine components. The Group also provides complete solution for financing and service. The Group has about 78,000 employees, production in 25 countries and operations are carried out in more 185 markets. Annual sales of the Volvo Group amount to nearly SEK 200 billion. ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2001/10/19/20011019BIT00060/bit0001.doc http://www.waymaker.net/bitonline/2001/10/19/20011019BIT00060/bit0001.pdf