Rolls-Royce shares are staging a proper comeback. After Trump’s tariff tantrum sent the aerospace giant tumbling, the stock’s back on track—up 1.6% to 1,250.50p on Tuesday morning. Not bad for a company that lost over 100p in a single week.
The Derbyshire-based firm, now worth £105bn, has been one of London’s star performers. It more than doubled last year, cementing its place among the FTSE 100’s elite. Here’s how Rolls-Royce weathered the storm.
The Tariff Hit That Knocked Rolls-Royce Down
Trump’s latest tariff salvo wasn’t kind to UK exporters. On 22nd January, he slapped a sweeping 10% tariff on NATO allies, citing Greenland’s defence as justification. Rolls-Royce took the hit hard—shares plunged 8% in the week that followed, shedding over 100p.
This wasn’t the first time Trump’s trade policy rattled the aerospace giant. Last year, during his “Liberation Day” tariff onslaught, Rolls-Royce shares crashed to lows of 659p before recovering. The pattern’s familiar by now.
It wasn’t just Rolls-Royce feeling the pain. The entire export sector watched nervously as Trump wielded tariffs like a blunt instrument. Classic TACO Trade behaviour—Trump Always Chickens Out, eventually.
The Bounce Back Begins
Here’s the thing about Trump’s tariff threats: they rarely stick. Last year, after his initial tariff panic subsided and he rowed back the levies, Rolls-Royce shares recovered to finish the year at 1,150p. The stock kept climbing.
Fast-forward to mid-January this year, and Rolls-Royce notched an all-time high of 1,305p. That’s the kind of resilience that gets investors excited. Tuesday’s 1.6% rally to 1,250.50p puts the shares back within striking distance of that peak.
Even a Delta Air Lines order for 62 new engines—typically good news—caused a modest dip last week. Markets can be weird like that. But the broader trend is clear: Rolls-Royce is back on the march.
Climbing the FTSE 100 Rankings
Rolls-Royce isn’t just recovering—it’s climbing the City’s league table. The company now sits in the top five most valuable firms on the London Stock Exchange, with only Unilever ahead at £108bn.
That’s a remarkable turnaround for a business that was written off by many during the pandemic. Last month, HSBC leapfrogged AstraZeneca to become the market’s most valuable company, but Rolls-Royce is hot on their heels.
For a firm that gained over 100% last year, the momentum shows no signs of stopping. Tariff scares aside, this is a stock that’s proven it can handle volatility and come out stronger.
What’s Driving Rolls-Royce’s Comeback?
A few factors are fuelling Rolls-Royce’s stellar performance. First, the aerospace sector is bouncing back post-pandemic. More flights mean more demand for engines and maintenance contracts—Rolls-Royce’s bread and butter.
Second, the company’s restructuring efforts under CEO Tufan Erginbilgic have paid off. Cost cuts, operational improvements, and a sharper focus on profitability have transformed the business.
Third, Trump’s tariffs turned out to be more bark than bite. Once markets realised the levies wouldn’t stick, confidence returned. That’s classic TACO Trade dynamics—big threats, limited follow-through.
Conclusion
Rolls-Royce shares are proving remarkably resilient. Despite Trump’s tariff theatrics, the aerospace giant is back within reach of all-time highs. With a £105bn market cap and a spot in the FTSE 100’s top five, this stock has momentum—keep watching.
FAQ
Q1: Why did Rolls-Royce shares drop in January 2025?
A: Trump announced a 10% tariff on NATO allies on 22nd January, citing Greenland defence concerns. Rolls-Royce shares plunged 8%, losing over 100p.
Q2: What is Rolls-Royce’s current market cap?
A: Rolls-Royce is worth £105bn, making it one of the top five most valuable companies on the London Stock Exchange. It’s just behind Unilever at £108bn.
Q3: How much did Rolls-Royce shares gain in 2024?
A: Rolls-Royce shares more than doubled in 2024, gaining over 100%. The stock became one of the FTSE 100’s top performers.
Q4: What is a TACO Trade?
A: TACO stands for “Trump Always Chickens Out.” It refers to Trump’s pattern of announcing aggressive tariffs, then walking them back.
Q5: Where does Rolls-Royce rank among FTSE 100 companies?
A: Rolls-Royce is in the top five most valuable firms on the London Stock Exchange. HSBC recently overtook AstraZeneca for the top spot.
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Effective Date: 15th July 2025
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