Rolls-Royce shares still diving after leaks found in air-scare Airbus A380 engines

The strife at Rolls-Royce showed little sign of easing today after Qantas said it had found oil leaks in engines made by the British company for its Airbus A380 superjumbos.

Rolls shares, in near-freefall after two serious incidents on planes using its engines last week, lost ground again today.

They were the biggest loser in the Footsie in early trading, dropping 4%, although they later recovered.

Rolls said it was close to understanding the cause of the engine failure, adding that the problem was specific to its Trent 900 engine and stressed it was the first such failure of one of its large civil engines for 16 years.

Rolls said: "We are working in close co-operation with Airbus, our customers and the authorities, and as always safety remains our highest priority."

Qantas said it would keep its Airbus A380 jets grounded for at least three more days, reviving safety fears after the blow-outs last week.

Chief executive Alan Joyce said rigorous testing had uncovered the anomalies on the Rolls-Royce engines on three aircraft, pushing back the return to action of the long-haul planes by 72 hours.

Rolls-Royce shares are down 13% since Thursday, after a Qantas Airbus A380 was forced into an emergency landing. Today they fell another 3p
to 588p.

The plane had to return to Singapore after one of its four Rolls-Royce Trent 900 engines exploded just minutes into its flight, showering an Indonesian town with debris.

On Friday, a Qantas Boeing 747 also had to turn back to Singapore after another model of Rolls-Royce engine also failed in mid-air.

That left investors fretting about the future for a company long regarded as the best that British engineering has to offer.

The fact that chief executive Sir John Rose plans to step down in March after 15 years at the helm is not helping sentiment, say analysts.

The company tried to stem the damage today by unveiling the details of a new, if medium-sized, contract win. It has been largely tight-lipped on the incidents themselves so far. Rolls said it has won a service order worth $350 million (£217 million) from Egyptair for looking after 12 Airbus A330 aircraft.

Metin Oktay, Rolls-Royce Civil Aerospace vice president, Africa, said: "We are delighted that Egyptair has once again demonstrated its confidence in Rolls-Royce."