September 15, 2021
(Reuters) – Raytheon Technologies Corp, which has commercial aircraft makers Boeing and Airbus as customers, expects to face inflation pressure in the coming years, its chief executive officer said on Wednesday.
With the cost of raw materials and precious metals going up, the company would see a little bit of pressure, CEO Gregory Hayes said at the Morgan Stanley Laguna Conference.
Hayes, however, added that higher costs would take a while to make its way to the customers in the form of price increases due to Raytheon’s long-term supply agreements.
“The shortages out there are real, especially on the logistics side… and inflation, especially on the commodity side, is real. And we’re starting to see it on the labor side as well.”
The U.S. aerospace manufacturer, which raised its full-year profit forecast in July on the back of higher demand for its commercial engines, spare parts and aftermarket services, said it continues to see the trend despite concerns from the Delta variant.
The Waltham, Massachusetts-based company expects full recovery in its commercial aero unit in 2024 and expects President Joe Biden’s vaccine mandate will strengthen the outlook heading into the fourth quarter.
(Reporting by Shreyasee Raj; Editing by Shailesh Kuber)