Rolls-Royce business unit Power Systems overcame difficult market conditions in 2019 and again succeeded in growing against the trend to deliver a strong full-year result. Underlying revenue increased by four per cent to £3.55bn (€4.04bn at time of receiving the report), coming in above the 4-billion-euro mark for the first time. Underlying operating profit grew by 15 per cent to £357m (€407m), corresponding to an adjusted return on sales of 10.1 per cent (up from 9.2 per cent in 2018). Now generating 23 per cent of overall revenue at British technology group Rolls-Royce, Power Systems remains its second-largest business unit. 

In 2020, the growth of the Power Systems business unit is expected to be modest. The uncertain economic conditions that defined the second half of 2019 will continue to be felt in the first half of this year and may still deteriorate – mainly due to the consequences of Covid-19. Economic recovery in the second half of the year is still a possibility, however, according to Power Systems business unit.

The rise in the global energy demand highlights an urgent need for eco- and climate-friendly power generation, and thus a new emphasis on eco-friendliness and climate neutrality will soon be reflected in the MTU product and solutions portfolio.

"We’re really stepping up our efforts here, and 2020 will be the first year in which the products we supply are not just powered by combustion fuels...” - Andreas Schell, CEO of Rolls-Royce Power Systems

“We’re taking an undogmatic approach to addressing the challenges of the energy turnaround and climate change, and in doing so we’re open to all technologies,” emphasized Andreas Schell, CEO of Rolls-Royce Power Systems. “We’re developing an array of technologies that are preserving the environment and aim to slow down global warming. We’ll also be combining them within our integrated solutions to make the drive power and energy that come from our systems as climate-neutral and eco-friendly as possible. We’re really stepping up our efforts here, and 2020 will be the first year in which the products we supply are not just powered by combustion fuels.”

The superyacht elements of the product and solution brand, MTU, build an important and stable business for Rolls-Royce’s business unit Power Systems and are “one of the major pillars of future success,” said Wolfgang Boller, business and regional spokesman for Rolls-Royce Power Systems, further to the latest financial report.

"There is a trend towards downsizing observable in the superyacht market, where customers no longer seem to merely focus on the highest power but rather seek smart and innovative system solutions which provide an increased level of comfort on board..." - Wolfgang Boller, business and regional spokesman, Rolls-Royce Power Systems

“There is a trend towards downsizing observable in the superyacht market, where customers no longer seem to merely focus on the highest power but rather seek smart and innovative system solutions which provide an increased level of comfort on board,” Boller continued, commenting on the state of the market.  

Efficiency and flexibility of the propulsion system are also of great interest today when operating a yacht. “More and more customers are also starting look for sustainability and environmental compatibility, and show an interest in alternative technologies, such as hybrid propulsion systems or electrification,” added Boller.

There are many factors to consider, such as IMO Tier III compliance, hydrogen power, and hybrid engines, when developing solutions for the market. “Rolls-Royce offers future-oriented modular hybrid systems for serial yachts,” said Boller. “The MTU hybrid system provides significant benefits to the owner, such as silent cruising, emission-free local operation, higher efficiency, low vibration and emission levels, savings on fuel consumption, environmental compatibility and the flexibility of the propulsion system.”

Together with U.K.’s luxury yacht manufacturer, Sunseeker, Rolls-Royce is developing a first serial yacht fitted with an MTU hybrid propulsion system. “To meet the IMO Tier III regulations, we are working on IMO Tier III compliant propulsion systems. Other future-oriented technologies are also currently being tested,” Boller hinted.

As a supplier of integrated solutions, the decarbonisation of their propulsion systems is a key strategic aim. In order to achieve this, Rolls-Royce remains open-minded to all technologies, for example, fuel cells, the application of which is currently being examined by the Power Systems business unit. By way of an example, a demonstrator equipped with several fuel cells derived from a cooperation with Daimler is being constructed on the Friedrichshafen site and is scheduled for completion by the end of 2020. 

Hydrogen technology holds a central position in possible future scenarios for the business. “We firmly believe that hydrogen is one of the keys to the energy turnaround,” said Schell. It is vital, however, that the hydrogen is manufactured in a climate-friendly manner using renewable energy sources. Therefore, the company is engaged with partners on several projects for the climate-neutral manufacture of hydrogen as a basis for producing energy or synthetic gaseous or liquid fuels, also known as Power-to-X. “With these fuels, we can make diesel engine operation virtually climate-neutral and save resources at the same time,” concluded Schell.

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