Trends and challenges

The Defence Aerospace market still holds a large opportunity for Rolls-Royce: with our existing applications and development portfolio we can access over half of the market.

In the current climate, like most, Defence budgets are under pressure. But there are still significant market opportunities in the airborne, fixed-wing and rotary sectors, including unmanned systems.

With demand driven by geo-political tensions, market activity remains strong and core defence budget spend will continue to underpin our performance.

Fuel is now a significant element of spend in military operations and is prompting the application of the latest propulsion technologies.

Long-term contracts

Many customer requirements over the next 10 years are already contracted, so current Rolls-Royce Defence Aerospace contracts are long-term with a balanced portfolio of customers and a good global spread. The business has good visibility for the next 12-18 months.

We have robust, long-term service contracts held directly with governmental defence departments.

Demand for military aero engines and engine–related services is worth around $450 billion over the next twenty years (original equipment $170 billion; Services $280 billion). The spend on research, development, technology and engineering is in addition to the $450 billion with global engine research and development worth around $20 billion (over twenty years).