Airline company Delta Air Lines (DAL) is replacing small engines called auxiliary power units (APUs) on over 300 of its Airbus (EADSF) A320 planes, according to The Wall Street Journal. These APUs help power the plane and provide air when the main engines are off, such as during taxiing or while parked. The change is being made because toxic fumes have been leaking into the cabin air when oil enters the APU’s compression chamber and burns at high heat, usually due to worn-out seals that are supposed to stop leaks.
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These fume problems have become more common in recent years, especially on A320 jets. Unsurprisingly, they can cause serious health issues like nausea, brain injuries, and other illnesses for passengers and flight crews. Furthermore, a recent WSJ report explained that not every fume event is reported, and different airlines have different ways of reporting them, which makes it hard to know how widespread the issue really is. It is also worth noting that Delta operates 310 A320s, and records show that the APUs in its planes are made by Honeywell (HON) and Pratt & Whitney, a division of RTX (RTX).
Interestingly, Delta quietly began replacing the APUs in 2022 and hadn’t publicly shared the decision until now. In addition, a spokesperson stated that, although these events are rare, Delta takes every case seriously. An Airbus spokesperson also said the company is working with airlines and regulators to improve cabin air quality. Meanwhile, both Honeywell and Pratt & Whitney have faced problems with their APUs for years, and although they’ve introduced several fixes and upgrades, the issue still lingers.
Is DAL Stock a Good Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on DAL stock based on 12 Buys assigned in the past three months, as indicated by the graphic below. Furthermore, the average DAL price target of $70.13 per share implies 22.4% upside potential.
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