Rolls-Royce said to offer China assembly line in push for jet engine deal

Proposal comes as Rolls competes with GE to power the CR929 wide-body plane being developed Comac slated for commercial sales around 2025

FILE PHOTO: An advertising poster for Airbus is pictured at the Airbus A330 final assembly line at Airbus headquarters in Colomiers, near Toulouse, France, November 26, 2018. REUTERS/Regis Duvignau/File Photo

Rolls-Royce is offering to build an aircraft engine assembly line in China as it chases a deal to supply turbines for the Asian nation’s first wide-body passenger jet, sources said.

The factory would also be able to make engines for Airbus’ A330neo jet, which the European plane maker is eager to get into the Chinese market, according to the sources. A representative for Rolls-Royce declined to comment.

The proposal comes as Rolls competes with General Electric to power the CR929 wide-body plane being developed by Commercial Aircraft Corp of China, known as Comac, slated for commercial sales around 2025. The London-based group is offering a derivative of the Trent 7000 model that’s the sole engine option on the A330neo.

Western aerospace firms are having to shift production to China to win orders in what’s set to become the world’s biggest aviation market early next decade. At the same time they’re reluctant to hand over technology that would enhance the country’s ability to make competitive planes without outside help and the Rolls facility would fall short of actual manufacturing, the sources said.

In offering a variant of the Trent 7000 instead of the Trent XWB that powers Airbus’s all-new A350, the UK company is also withholding some recent innovations in fan and turbine-blade design from the CR929, which will likely feature 250 to 320 seats, making it similar in size to the A330.

Rolls is continuing to weigh a partnership with state-owned Aero Engine Corp of China (AECC) on the jet, the people said. The wide-body is being developed by Comac with Russia’s United Aircraft, a unit of Rostec State, which has also said it could work with AECC on developing turbines, most likely for a later version.

Aerospace ranks third-top among priority industries identified in President Xi Jinping’s “Made in China 2025” programme as the country seeks to take plane making to a level where it can start competing with Airbus and Boeing.

China will need 7,690 new aircraft worth $1.2 trillion over the next 20 years, according to the US company, with Comac itself aiming to deliver 2,000 planes by 2035.

The Rolls-Royce plant might offer Airbus a way to boost sales of the A330neo, a model pitched by the European company as perfectly suited to the Chinese market but struggling to win orders in competition with Boeing’s more advanced 787 Dreamliner.

With a backlog of 238 jets as of the end of January, a deal for the A330neo from China would come as a huge boost to the programme.

Separately, Britain's government on Monday said it had awarded Rolls-Royce a £235 million (Dh1.14 billion) contract to maintain nuclear submarines.

Rolls will provide support and advice for systems on board the current fleet of Trafalgar, Vanguard and Astute class submarines until 2022, the defence ministry said.

The contract would support around 500 jobs in the United Kingdom, it said.

"This year, we mark half a century since British nuclear-armed submarines began their continuous patrol of waters around the world," said Gavin Williamson, the defence minister.

"This significant milestone for the Royal Navy would not be possible without the skills and ingenuity of our industry partners who supply and maintain equipment."