United States Commerce Secretary Howard Lutnick says Rolls-Royce will be able to sell its engines to Boeing tariff-free, as will other United Kingdom-based aircraft parts manufacturers.
The UK "sells Rolls-Royce engines to Boeing," Lutnick said during a May 8 televised media briefing from the Oval Office. "We've agreed to let Rolls-Royce engines and those kind of plane parts come over tariff-free." The deal was part of broader tariff negotiations nutted out last week between the US and UK that will see a reciprocal tariff rate of 10% applied to most imported goods. Boeing uses Rolls-Royce engines for many of its commercial aircraft, including B787s and first-generation B777 variants.
Lutnick's willingness to exempt the aerospace sector from the tariff regime coincided with news that IAG International Airlines Group has signed an order for thirty-two B787-10s and exercised options to acquire six B777-9s for subsidiary British Airways (BA, London Heathrow).
The UK aerospace sector is worth GBP40 billion pounds (USD53 billion) and directly and indirectly employs approximately 450,000 people. The US has been investigating whether imported aircraft, jet engines, and parts from the UK and elsewhere threatened national security.
Neither Rolls Royce nor the Department of Commerce responded to a request for comment.
Meanwhile, weekend talks have resulted in a tariff reset between the US and China. The US had imposed a 145% tariff on Chinese-made products, and China reciprocated with a 125% tariff. Among other outcomes, it stalled the delivery of new Boeing aircraft to Chinese carriers. The US will now lower its tariffs to 30%, and China will decrease its tariffs to 10%. In official comments, both sides have welcomed the development.
