London, March 9, 2026, 21:12 GMT
Rolls-Royce Holdings plc on Monday announced it has inked a preliminary agreement with Poland’s Polska Grupa Zbrojeniowa (PGZ) aimed at ramping up collaboration on propulsion systems for military vehicles and naval vessels, giving the British engineering firm a bigger foothold in Europe’s rearmament efforts. Under the proposed partnership, the companies may tackle everything from maintenance and upgrades of existing mtu systems to manufacturing complete drive units and components on Polish soil. Rolls-Royce
Timing is key here. According to data out Monday from SIPRI, Europe has overtaken other regions as the largest importer of arms for the 2021-25 period. Just last week, Poland’s parliament signed off on a plan to unlock 43.7 billion euros ($51.6 billion) in EU military loans. That surge in European buying “pushed global arms transfers up almost 10 per cent,” said SIPRI arms-transfer director Mathew George. Reuters
That fits for Rolls. Growth lately has been fueled by exactly those areas. On Feb. 26, the company pointed to a boost in its power-systems unit, crediting increased naval budgets and a surge in data-centre demand. Rolls also raised its medium-term guidance, after it posted 2025 adjusted operating profit of 3.46 billion pounds—a metric that excludes certain one-off costs. Reuters
Rolls said it’s struck a memorandum of understanding—a first-step cooperation deal—covering both military vehicle propulsion and marine engines. The company’s mtu power-systems brand is already in service with Poland’s armed forces and inside the Borsuk armored vehicle. Paul Röck of Rolls-Royce Power Systems called the group a “reliable partner” for the Polish military. Rolls-Royce
PGZ, the Polish defence company with partial state backing, said the deal could pave the way for domestic production of spare parts and components, and possibly slot some Polish sites into the Rolls-Royce supply chain. Andreas Görtz described PGZ’s move as “recognition of our collaboration to date.” PGZ’s Arkadiusz Bąk added, “the idea of localisation is taking shape here.” Rolls-Royce
Ramped-up spending has boosted suppliers spanning aerospace, engines, and electronics—think BAE Systems, Rheinmetall—while governments across Europe hike budgets and restock arsenals. Rolls, for its part, is targeting that surge in demand with engines, propulsion, and service contracts, steering clear of full weapons systems. Reuters
The agreement in Poland isn’t a binding commitment yet. No financial details came out, and the country’s push for EU defence loans is still up in the air with President Karol Nawrocki keeping quiet on a possible veto. Rolls, for its part, continues to flag ongoing supply-chain pressures in aerospace. Rolls-Royce
Rolls-Royce Power Systems counts government business among its five key growth areas, according to the company. The move announced Monday marks another step away from the civil aviation focus and deeper into defence and power, sectors where Rolls is already seeing growing demand. Rolls-Royce
