Re Agreement

17 September, 2004

  ROLLS-ROYCE AND AIR NEW ZEALAND SIGN LONG-TERM SERVICE AGREEMENTS FOR TRENT  
                                 ENGINE FLEET                                  

Rolls-Royce announced today (17 September) that it had signed long-term
TotalCare service agreements covering the maintenance of the Trent engines
which will power Air New Zealand's Boeing 777 and Boeing 7E7 airliners.

The combined value of the contracts is around $500 million.

Mike Terrett, President, Civil Aerospace, Rolls-Royce, said: "We were delighted
by Air New Zealand's decision to become a new Trent customer, and these
comprehensive TotalCare agreements build significantly on that choice. This
type of contract supports Air New Zealand's drive for innovation and efficiency
in fleet care.

"As the engine manufacturer we have unique product knowledge, and the ability
to use it for the benefit of customers."

TotalCare packages are tailored for individual operators and involve a broad
menu of options covering engine fleet maintenance, carried out by Rolls-Royce,
based on an agreed dollar rate per flying hour.

Around 60 per cent of the Trent fleet world wide is covered by TotalCare
agreements, the 1,000th Trent engine having been delivered in June.

Air New Zealand was the first airline to make an engine choice on the Boeing
7E7 when it selected the Trent 1000 for its two twinjets on order. At the same
time, it also announced selection of the Trent 800 for eight Boeing 777-200ER
aircraft.

Preliminary design on the Trent 1000 is due for completion later this year,
with the first development engine running in 2006. Engine certification by the
airworthiness authorities is scheduled for 2007.

The Trent 800 entered service on the Boeing 777 in 1996. Programme sales are
now approaching 300, with orders from 13 customers.

Star Alliance member Air New Zealand already uses Rolls-Royce RB211-524G/T
engines on its Boeing 747-400s. A further Rolls-Royce connection comes through
the V2500 engines on the airline's Airbus A320 series aircraft. The V2500 is
produced by the International Aero Engines consortium in which Rolls-Royce is a
senior partner.

Corporate note to editors

Rolls-Royce operates in four global markets - civil aerospace, defence
aerospace, marine and energy. It is investing in technology and capability that
can be exploited in each of these sectors to create a competitive range of
products.

The success of these products is demonstrated by the company's rapid and
substantial gains in market share over recent years. The company now has a
total of 54,000 gas turbines in service worldwide. The investments in product,
capability and infrastructure to gain this market position create high barriers
to entry.

Rolls-Royce has a broad customer base comprising more than 500 airlines, 4,000
corporate and utility aircraft and helicopter operators, 160 armed forces and
more than 2,000 marine customers, including 50 navies. The company has energy
customers in nearly 120 countries. Rolls-Royce employs around 35,000 people, of
which 21,000 are in the UK. Forty per cent of its employees are based outside
the UK - including 5,000 in the rest of Europe and 8,000 in North America.

The large installed base of engines generates demand for the provision of
services. A key element of the company's strategy is to maximize services
revenues, which have increased by 60 per cent over the past five years, by the
provision of a comprehensive portfolio of services.

Annual sales total nearly £6 billion, of which more than 50 per cent are
services revenues. The order book is more than £19 billion, which, together
with demand for services, provides visibility as to future activity levels.

For further information contact:

Neil Williams

Communications Manager - Civil Aerospace

Rolls-Royce

PO Box 31

Derby

DE24 8BJ

Tel: [phone]

Fax: [phone]

Email: [e-mail]