Rolls-Royce plc

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This article is about the aircraft engine company. For the brand of automobile, see Rolls-Royce Motor Cars.

Rolls-Royce Group plc

Type of Company	Public (LSE: RR.)
Founded	1906 (as Rolls-Royce Limited)
Headquarters	Derby, England
Key people	Simon Robertson (Chairman) Sir John Rose (CEO)
Industry	Aerospace & Defence
Products	Civil & military aero engines Marine propulsion systems Power generation equipment
Revenue	£6,603 million (2005)
Operating income	£879 million
Net income	£347 million
Employees	36,200 (2005)
Website	www.rolls-royce.com

Rolls-Royce plc is the second-largest aircraft engine maker in the world, behind General Electric Aviation. The company has related businesses in defence, marine and energy markets.

Rolls-Royce was nationalised in 1971 by which time aircraft engines had long been the most significant part of the business. The automobile company was separated in 1973 and the present Rolls-Royce plc was re-privatised in 1987. Rolls-Royce is, through its military engine division, the world's 18th largest defence contractor.^[1] Defence sales accounted for 23% of group sales in 2004, civil aerospace 51%, marine 16% and energy 8%. ^[2]

[edit] History

Rolls-Royce Limited was founded in 1906 by Henry Royce and The Honourable C.S. Rolls and produced its first aircraft engine in 1914.

Around half the aircraft engines used by the Allies in World War I were made by Rolls-Royce. By the late 1920s, aero engines made up most of Rolls-Royce's business. Henry Royce's last design was the Merlin aero engine, which came out in 1935 although he had died in 1933. This was a development subsequent to the R engine, which had powered a record-breaking Supermarine S6.B seaplane to almost 400mph in the 1931 Schneider Trophy. The Merlin powered many World War II aircraft: the British Hawker Hurricane, Supermarine Spitfire, De Havilland Mosquito (twin-engined), Avro Lancaster (4-engine), Vickers Wellington (2-engine); it also transformed the American P-51 Mustang into one of the best fighters of its time, its Merlin engine built by Packard under license. Over 160,000 Merlin engines were produced.

In the post-World War II period Rolls-Royce made significant advances in gas turbine engine design and manufacture. The Dart and Tyne turboprop engines were particularly important enabling airlines to cut journey times within several continents whilst jet airliners were introduced on longer services. The Dart engine was used in Argosy, Avro 748, Friendship, Herald and Viscount aircraft, whilst the more powerful Tyne powered the Atlantic, Transall and the Vanguard. Many of these turboprops are still in service.

Amongst the jet engines of this period was the RB163 Spey which powers the Trident, BAC 1-11, Grumman Gulfstream II and Fokker F28.

During the late 50's and 60's there was a significant rationalisation of the British aero-engine manufacturers, culminating in the merger of Rolls-Royce and Bristol Siddeley in 1966 (Bristol Siddeley had itself resulted from the merger of Armstrong Siddeley and Bristol in 1959). Bristol, with its principal factory at Filton, near Bristol, had a strong base in military engines, including the Olympus, which was chosen for Concorde.

[edit] Nationalisation & separation

Having been selected as the sole engine for the Lockheed L-1011 (TriStar) Rolls-Royce committed heavily to the RB211 engine. Development of the RB211 was hampered by considerable problems and on February 4, 1971 Rolls-Royce was declared bankrupt. To save the company Edward Heath's government nationalised it. The automotive division was separated from the aircraft engine division in 1973 as Rolls-Royce Motors.

[edit] Privatisation & expansion

Rolls-Royce plc was privatised in 1987 under Margaret Thatcher. The 1980s saw the introduction of a policy to offer an engine on every civil aircraft type with the company now powering 17 different airliners (and their variants) compared to General Electric's 14 and Pratt & Whitney's 10.

In 1988, Rolls Royce acquired Northern Engineering Industries (NEI), a group of heavy engineering companies mainly associated with electrical generation and power management, based in the North East of England. The group included Clarke Chapman (Cranes), Reyrolle (now part of VA Tech) and Parsons (now part of Siemens Steam turbines). The company was renamed Rolls Royce Industrial Power Group. It was gradually sold off piecemeal over the next decade as the company re-focused on its core aero-engine operations following the recession of the early 1990s.

In 1990 BMW and Rolls-Royce established the BMW Rolls-Royce joint venture to produce the BR700 range of engines for regional and corporate jets.

[edit] Allison acquisition

In November 1994 Rolls-Royce announced its intention to acquire Allison Engine Company, an American manufacturer of gas turbines and components for aviation, industrial and marine engines. Rolls-Royce had previously attempted to buy the company when General Motors sold the company in 1993, however GM chose to sell to a management buyout. Due to Allison's involvement in classified and export restricted technology, the 1994 acquisition was subject to investigation to determine the national security implications of the sale. On 27 March 1995 the Department of Defense announced that the "deal between Allison Engine Co. and Rolls-Royce does not endanger national security." [3] However Rolls-Royce was obliged to set up a proxy board to manage Allison and had also to set up a separate company, Allison Advanced Development Company, Inc., to manage classified programmes "that involve leading-edge technologies". In 2000 this restriction was replaced by a more flexible Special Security Arrangement.

The Allison acquisition brought four new engine types into the Rolls-Royce civil engine portfolio on seven platforms and several light aircraft applications. Allison is now known as Rolls-Royce Corporation, part of Rolls-Royce North America.

In 1996 Rolls-Royce and Airbus signed a Memorandum of Understanding specifiying the Trent 900 as the engine of choice for the then A3XX, now the Airbus A380.

[edit] 1999 acquisitions

Rolls-Royce spent £1.063 billion on acquisitions in 1999. These were interests of Cooper Energy Services (with the effect of making the Cooper Rolls joint venture a wholly owned subsidiary of Rolls-Royce), Vickers, National Airmotive Corporation and BMW's share of BMW Rolls-Royce.

Rolls-Royce acquired Vickers plc for its marine businesses. Vickers had expanded this section of its business in the period leading up to the purchase; acquiring Kamewa, a manufacturer of waterjets, in 1996 and Ulstein, a major marine propulsion and engineering company, in 1998. Rolls-Royce sold Vickers Defence Systems (the other major Vickers area of business) to Alvis plc in 2002 which formed Alvis Vickers, then the largest armoured vehicle company in the UK.

Rolls-Royce has established a leading position in the corporate and regional airline sector through the development of the Tay engine, the Allison acquisition and the consolidation of the BMW Rolls-Royce joint venture. In 1999 BMW Rolls-Royce was renamed Rolls-Royce Deutschland and became a 100% owned subsidiary of Rolls-Royce plc.

Data Systems & Solutions was founded in 1999 as a joint venture between Rolls-Royce plc and Science Applications International Corporation (SAIC). In early 2006, SAIC exited the joint venture agreement, making Rolls-Royce plc the sole owner.

[edit] Recent events

On April 6, 2004 Boeing announced that it had selected both Rolls-Royce and General Electric to power its new 787. Rolls-Royce submitted the Trent 1000, a further development of that series. GE's offering is the GENX, a development of the GE90.

On June 13 Rolls Royce were awarded a £110m deal with the Ministry of Defence to supply engines to its C-130 Hercules transport aircraft for the next 5 years.^[1]

In July 2006, Rolls-Royce reached an agreement to supply a new version of the Trent for the revised Airbus A350 (XWB) jetliner. Although details have yet to be released, it is likely that the so-called Trent XWB will be significantly larger than the Trent 1700, basically a throttle-push of the Trent 1000 intended for the original A350 proposal.

In October 2006 Rolls-Royce announced that it would suspend production of its Trent 900 engine due to delays by Airbus on the A380. Rolls-Royce has not confirmed any arrangements for staff working on the project which could be suspended for 12 months. Rolls-Royce has said it will consult with Airbus and then with the union. The plant in Derby, UK employs 11,000 workers and will continue to produce engines for Boeing and Bombardier which includes Boeing's new 787 series.

[edit] Current operations

Rolls-Royce's aerospace business makes commercial and military gas turbine engines for military, airline, and corporate aircraft customers worldwide. In the U.S., the company makes engines for regional and corporate jets, helicopters, and turboprop aircraft. Rolls-Royce also constructs and installs power generation systems. Its core gas turbine technology has created one of the broadest product ranges of aero-engines in the world, with 50,000 engines in service with 500 airlines, 2,400 corporate and utility operators and more than 100 armed forces, powering both fixed- and rotary-wing aircraft.

Rolls-Royce Marine Power Operations Ltd (a subsidiary company)manufactures and tests nuclear reactors for Royal Naval submarines.