The UK Government and
Rolls-Royce have agreed a long-term partnership centred on a £2.5 billion programme to develop the next generation of jet engines in the UK, a move expected to support thousands of jobs and strengthen the country's aerospace manufacturing base.
Announced this week as part of the Chancellor's Budget, the agreement will see government and industry jointly fund a 10-year programme focused on developing cleaner and more efficient engines for future passenger and military aircraft.
The deal is designed to secure the UK's position in a highly specialised sector, with only a small number of nations capable of designing and manufacturing advanced aerospace engines.
Rolls-Royce believes success in winning a place on future single-aisle commercial aircraft programmes could unlock billions of pounds of additional investment in the UK over the coming decades and contribute as much as £120 billion to the economy during the programme's lifetime.
The agreement is expected to support around 3,300 jobs by the end of 2029, while creating the potential for tens of thousands more roles in the years ahead. Opportunities are anticipated across engineering, research, manufacturing and supply chain operations, with many of the jobs expected to be created outside London and the South East through Rolls-Royce's nationwide manufacturing network.
Single-aisle aircraft, used on short and medium-haul routes, are forecast to become the largest segment of the global civil aerospace market. The Government said securing a UK-built engine for these aircraft represents one of the biggest opportunities for the domestic aerospace sector over the next half century.
Beyond civil aviation, the technologies developed through the programme could also support future military aircraft propulsion systems. Development work is expected to focus on advanced materials, electronics, robotics, artificial intelligence and next-generation manufacturing processes.
Prime Minister Andy Burnham said: “Britain has always been an industrial powerhouse. But that strength isn't just part of our past, it should be a core part of our future too. That's why we're driving forward reindustrialisation and this agreement shows what that looks like in practice. It gives businesses the certainty to invest, creates jobs people can build a future on, and keeps British industry where it belongs, at the forefront of innovation.”
Business Secretary Jonathan Reynolds described the agreement as evidence of the Government's commitment to reindustrialisation and long-term economic growth.
He said: “It makes sure Britain will win the race to power the next generation of passenger planes, keeping jet engine manufacturing in the UK and creating tens of thousands of jobs in the long term.
“It's also a real vote of confidence in the economic plan we're delivering, giving businesses the certainty they need to grow and invest here on our shores.”
Rolls-Royce chief executive Tufan Erginbilgic said the programme represented a major opportunity for the UK aerospace sector.
“This is a landmark moment for the UK's aerospace industry,” he said. “This is a once-in-a-generation opportunity to lay the foundations for decades of sustainable economic growth across the UK, creating high-value jobs and transforming the country's advanced manufacturing supply chain.
“Aerospace is a growing and globally attractive market and this programme with Government is vital to enable the UK to compete.”
The agreement provides a framework for future Government support but does not involve any new grants at this stage. Any future funding commitments will remain subject to value-for-money assessments, legal approvals and subsidy control requirements.
The announcement builds on broader efforts to strengthen the UK aerospace sector, which employs around 113,000 people and contributes more than £46 billion annually to the UK economy. It also follows the launch earlier this year of a £100 million Aerospace Supply Chain Fund aimed at helping UK suppliers expand capacity and meet growing industry demand.
Gary Elliott, CEO,
Aerospace Technology Institute, said: “Rolls-Royce’s re-entry into the single-aisle aircraft market represents a major growth opportunity for UK aerospace. It will be critical to delivering the industry ambition, set out in the Aerospace Technology Institute’s technology strategy, to double the size of the sector by 2035, driving growth and supporting highly skilled jobs across the UK.
“Realising the full potential of this opportunity will require continued investment across the whole aerospace sector, ensuring the UK has the technology and capability to compete and grow.”
Pic credit: Rolls-Royce plc