Reports suggest that governments in Germany and the US are trying to entice the Derby-based firm to their countries
15:32, 16 Dec 2025Updated 15:48, 16 Dec 2025
Rolls-Royce engines on the assembly line at manufacturing giant’s Derby factory but there is speculation that a new range of engines could be built elsewhere(Image: Paul Ellis – WPA Pool/Getty Images)
There is speculation that Rolls-Royce is being courted by Germany and the US to build a new range of jet engines in their countries instead of Britain – which would be a blow to the British Government’s growth plans.
The programme, which would allow Rolls-Royce to re-enter the narrow-body engine market – worth £1.6 trillion globally – for planes used on shorter-haul flights could create 40,000 jobs among workers and the supply chain, reports the Daily Mail.
Surging energy costs – blamed on Ed Miliband’s Net Zero drive – are making it harder to make money from manufacturing in Britain. It is reported that the firm is in talks with the Government over financial support for the programme – which Labour has identified as a key part of its industrial strategy.
And it is understood that developing the engines in Britain is the preference of boss Tufan Erginbilgic, who has led a turnaround of the UK manufacturing giant.
But one of the main unions with members at the company has played down the speculation and refused to comment.
Insiders believe there are “plenty of options” outside the UK. And without the taxpayer support it is seeking – in the hundreds of millions of pounds – it will weigh up building the engines in Germany or the US, two countries where it already has manufacturing sites, and where energy is much cheaper.
The company is thought to be seeking financial backing from the UK towards some of the project’s £3 billion research and development costs. But it estimates the business could generate more than £100 billion for the UK economy
Rolls-Royce currently builds engines for the wide-body long-haul aircraft, such as the Airbus A350, having left the narrow-body market a decade ago. It is trying to re-enter the market, which includes Airbus’s A320. They represent a much larger number of aircraft, used on shorter routes such as flights within Europe.
Firms in Britain are facing electricity prices that are 50% more expensive than in Germany and France and four times as expensive as in the US, a recent report from Santander warned.
A spokesman for the Department for Business and Trade said: “The UK has one of the world’s most competitive aerospace sectors, and we expect Rolls-Royce to continue to play a key role in the sector.”
Rolls-Royce has declined to comment. Derbyshire Live approached the union Unite for a comment, but it declined, saying that it is “speculation from unnamed sources”.