Back us, or jobs go abroad: Rolls pushes Burnham to support narrow-body jet engine project
Rolls-Royce has intensified pressure on the government to back its ambitious plans to re-enter the narrow-body jet engine market, warning that failure to secure support could see 40,000 jobs and £120 billion in economic value shift overseas.
Chief executive Tufan Erginbilgic, speaking at the Farnborough Airshow, said talks with ministers over financial backing for the project were progressing but urged them to accelerate their decision-making. The company is seeking up to £200 million in government support for a £3 billion program to develop the UltraFan 30 engine demonstrator, with ground testing scheduled for 2028.
The stakes are high. Airbus and Boeing are expected to select engines for their next generation of narrow-body aircraft by 2027, with service entry planned for the mid-2030s. Erginbilgic warned that once manufacturers make their engine selections, opportunities close. "If you want economic growth, this will transform it," he said. "Once they make an engine decision, you are either in or you are out."
A market Rolls-Royce abandoned 15 years ago
Rolls-Royce exited the narrow-body jet engine market approximately 15 years ago when it withdrew from the International Aero Engines consortium's V2500 engine program. Since then, the market has been dominated by two players: CFM International, a joint venture between GE Aerospace and Safran, and Pratt & Whitney.
The narrow-body segment represents the largest volume market in commercial aviation, with industry forecasts from Boeing and Airbus anticipating approximately 33,000 single-aisle aircraft deliveries globally over the next two decades. The total market is estimated to be worth £1.6 trillion.
Rolls-Royce has indicated it would seek to re-enter through a partnership rather than going it alone, as outlined in its 2025 full-year results presentation to shareholders.
Germany and US alternatives threaten UK jobs
Without the taxpayer support it seeks, Rolls-Royce has made clear it would consider building the engines at its existing manufacturing facilities in Germany or the United States, where energy costs are significantly lower. The company operates sites at Dahlewitz near Berlin and Oberursel near Frankfurt, as well as multiple US locations.
Erginbilgic said the company would prefer to manufacture in the UK given its origins but emphasised that other options exist. "From the country's perspective, it is a very compelling proposition and we would like to do it in the UK because of our origin. Do we have other options? Yes, but that's what we would like to do."
Warning on tax policy
The chief executive also issued a broader warning about the impact of higher taxes on business investment decisions. "Sometimes you increase the tax, and then you say this much income will come. Tax doesn't work that way because businesses have choices," he said. "When you are making these big investments – billions – you obviously want some stability on the tax structure."
Erginbilgic welcomed the appointment of John Healey as Chancellor, noting that Healey understands Rolls-Royce's agenda and its contribution to the country. Healey, who resigned as Defence Secretary in June 2026 after a dispute over military spending, was appointed Chancellor by Prime Minister Andy Burnham in July. His appointment has fueled speculation about increased military and defence-related spending, with defence stocks rising on hopes of greater investment under his leadership.
While Erginbilgic has not yet spoken directly with the Prime Minister, he said discussing the narrow-body engine project would be a priority. The company argues that the program represents a relatively modest investment in the context of the economic transformation it could deliver for UK advanced manufacturing and supply chains.
The narrow-body engine program could support up to 40,000 UK jobs and generate £120 billion in lifetime economic value for the economy, according to Rolls-Royce. The company insists the decision is now in the government's hands, with the clock ticking toward the 2027 deadline when aircraft manufacturers will lock in their engine choices for the next generation of planes.
