Rolls-Royce nears taxpayer subsidy deal to develop new engine in UK

Rolls-Royce is nearing a £100mn-£200mn UK government subsidy towards a demonstrator of its new UltraFan 30 narrow-body engine, possibly announced as early as next week, with the money expected to come via the Aerospace Technology Institute. It would be one of the biggest reindustrialisation commitments by PM Andy Burnham (in office since July); it was delayed by Starmer's departure. CEO Tufan Erginbilgiç says the programme could support up to 40,000 skilled jobs and add up to £120bn to the UK economy; a certified engine could cost up to £3bn more, and Rolls-Royce would also invest and commit to jobs. The company had warned it could move production to Germany (Dahlewitz). Airbus and Boeing are expected to pick engines for their next-generation narrow-body jets by the end of the decade; Rolls-Royce left that market more than 10 years ago. It argues rivals Pratt & Whitney, GE and Safran get far more state aid. Rolls-Royce also plans to return up to £9bn to shareholders over three years. Caveats: talks are ongoing and timing could change; Rolls-Royce and DBT declined to comment; taxpayer support sits alongside large shareholder payouts.