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UK to fund £1.25bn Rolls-Royce UltraFan engine program

By Drooid · Oct 29, 2026 · How we work

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Summary

The UK government and Rolls-Royce launched a £2.5 bn, 10-year programme to develop narrow-body jet engines.
Chancellor John Healey announced the taxpayer will fund £1.25 bn of the programme.
Rolls-Royce expects the first stage to support 3,300 UK jobs by end-2029.
The programme will develop a demonstrator UltraFan engine for Airbus and Boeing narrow-body aircraft.
CEO Tufan Erginbilgic warned UltraFan production might move abroad without the £1.25 bn support.

Summary

Rolls-Royce shares rose 4.7% after reports of extra UK defence spending, still below EUR 18.47 high.
Avolon placed a firm order for 70 Trent 7000 engines for 35 Airbus A330-900neo jets on 13 October.
GAO reported on 31 July the U.S. B-52J CERP engine programme is 38% over budget at $3 billion and delayed.
Treasury confirmed an extra £20.4 billion for the National Wealth Fund and British Business Bank over five years.

History

In February 1971, Rolls-Royce entered receivership and was nationalised by Prime Minister Edward Heath’s Conservative government, creating Rolls-Royce (1971) Ltd. The move secured a £170.3 million bailout and a revised contract with Lockheed, allowing the RB211 engine to be certified in April 1972 and preserving hundreds of Derby jobs. The UltraFan programme, backed by Chancellor John Healey’s £1.25 billion contribution, echoes that state-industry rescue to protect UK aerospace employment.

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In February 1971, Rolls-Royce entered receivership and was nationalised by Prime Minister Edward Heath’s Conservative government, creating Rolls-Royce (1971) Ltd. The move secured a £170.3 million bailout and a revised contract with Lockheed, allowing the RB211 engine to be certified in April 1972 and preserving hundreds of Derby jobs. The UltraFan programme, backed by Chancellor John Healey’s £1.25 billion contribution, echoes that state-industry rescue to protect UK aerospace employment.

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