Rolls-Royce to land £130m BA deal

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The firm's 'Trent' engines are understood to have edged out U.S. rival General Electric's GE90 model in a fiercely-contested bidding war to power the Boeing 777-200 planes.

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The BA deal is a major coup for Rolls-Royce

Sources said BA favoured Derby-based Rolls-Royce because it offered a better price and a more attractive long-term maintenance deal.

The eight engines, scheduled to be delivered in 2009, have a list price of about £14million, but BA will have almost certainly negotiated a discount.

The deal is a major coup for Rolls-Royce, after a period when it has seen GE usurp its close relationship with the airline.

BA stunned Rolls in 1991 when it chose GE to power 30 twin-engined Boeing 777s it ordered.

Another blow came in 2005 when the airline handed a £1.5billion, ten-year engine maintenance contract to GE.

Bob Laxton, Labour MP for Derby North, has been a keen proponent of the current Rolls bid, saying the deal would secure jobs in the region and that BA would be 'mad to choose any other engine'.

There could also be further work for Rolls, as BA has an option to buy another four Boeing 777-200 planes, although it is understood this latest deal will contain no guarantees on contracts for those.

BA's 43-strong fleet of Boeing 777s are pretty equally split between Rolls and GE engines, although all 16 of its 777-200s are powered by Rolls-Royce engines.

As well as this deal, Rolls and GE are battling over who will supply engines for BA's next major plane order to replace its ageing long-haul fleet.

Sources indicated this week's expected announcement, which could come as early as today, will have no impact on the outcome of that contract.