Rolls-Royce and Pratt & Whitney have abandoned plans to form a partnership to develop engines for mid-size aircraft, the two firms said on Thursday.
In October 2011 Rolls and Pratt, a unit of United Technologies, announced plans to form a partnership to develop engines for 120-230 seat passenger aircraft that in future years would replace the Airbus A320neo and Boeing 737 MAX narrow-body planes.
However, on Thursday the two firms said following discussions, they had decided not to proceed with the partnership "because of the current regulatory environment".
"The two companies entered into the venture in good faith but there are very few players in this area of the market and UTC and Rolls-Royce felt competition bodies in a number of jurisdictions would have made moving ahead with the partnership complicated," said a source close to the two firms.
Pratt and Rolls planned to hold an equal share in the venture, which was intended to study geared turbofan and open rotor technology along with other types of engine configurations.
When the tie up was announced, analysts believed the move had resolved a spat between the two companies who are the dominant players in the market for aircraft engines along with General Electric.
"Rolls-Royce remains fully committed to this important market segment and will continue to invest in technologies that will enable us to take advantage of opportunities as they arise," the British company said.