Rolls-Royce: 2026 Supply Chain Challenges Persist, Beijing JV Delivers First Engine, 2034 Full Output

Liu Xiaowei, senior vice president of Rolls-Royce civil aviation, said that supply chain challenges in the civil aviation sector will persist through 2026. The company plans to achieve a zero grounded aircraft target in the second half of 2025. Current overhaul capacity is sufficient and expanding, but shortages of key components have extended overhaul turnaround times and led to forced aircraft groundings.

Rolls-Royce has taken steps to address supply chain issues. Procurement in China grew over 10% in 2025, and the resilience and industrial base of Chinese manufacturing are significant to Rolls-Royce's global supply chain. The company has also deployed engineers and specialist teams to key suppliers to help improve management and production capacity.

Sun Mingze, market director for Rolls-Royce civil aviation in Greater China, added that Rolls-Royce has not experienced any aircraft delivery delays due to engine delivery issues, and its performance on Airbus and Boeing deliveries has been strong. Despite supply chain pressure, the turnaround time for widebody engine maintenance has been good, with the MRO network reducing turnaround time by about 10% in 2025, and further gains through digital tools.

Rolls-Royce plans to invest 7.5 billion pounds in total to expand capacity or establish new maintenance capabilities at 12 overhaul facilities.

Greater China is a key investment area for Rolls-Royce's global aftermarket network. In civil aviation, there are over 600 aircraft in service or on order in Greater China powered by Rolls-Royce engines, including more than 500 in service and over 150 on order. In business aviation, nearly half of the business jets in Greater China are powered by Rolls-Royce engines, and business aviation contributes about 20% of Rolls-Royce's global civil aviation revenue.

Rolls-Royce holds over 50% fleet share in the widebody market in Greater China. Globally, Trent engine deliveries to Greater China account for about 20% of total deliveries, meaning that one out of every five Trent engines produced serves a customer in Greater China.

Regarding joint ventures, Rolls-Royce has four engine overhaul joint venture factories worldwide in which it holds a 50% stake, with two located in Greater China. Beijing Aero Engine Services Co. (BAESL), established in 2022 as a joint venture with Air China, began operations at the end of 2025 and delivered its first engine within the year. It is the first maintenance facility in mainland China with the capability to perform complete widebody engine overhauls, and is expected to reach full production at an annual capacity of 250 engine overhauls by 2034.