Aircraft contract cancellations lead BAE to axe jobs

10 December 2010
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10 December 2010 | Angeline Albert

BAESystems plans to eliminate 1,307 jobs as a result of the UK government’s decision to end contracts for new Harrier and Nimrod MRA4 aircraft.

The aerospace and defence supplier said the government’s StrategicDefence and Security Review (SDSR) had forced the company’s hand, resulting in potential job losses at six of its UK sites and two RAF bases.

Kevin Taylor, managing director of BAE Systems Military Air Solutions said: “Since the publication of the SDSR in October we have taken time to understand the implications for our business. We have recently received termination for customer convenience notices [the Ministry of Defence’s decision to cancel the deals] for the Nimrod MRA4 and Harrier contracts and this has regrettably led us to initiating consultation regarding potential job losses.”
Announcing the cancellation in October, Prime Minister David Cameron said the Nimrod programme cost taxpayers more than £3 billion, while the cost per aircraft had increased by more than 200 per cent and the project was over eight years late. The government’s SDSR said its decision not to bring the Nimrod MRA4 into service means the Ministry of Defence will depend on existing aircraft for this capability.

The Nimrod MRA4 cancellation will lead to 79 job losses at Chadderton in Greater Manchester, 30 at RAF Kinloss in Moray, 15 at Yeovil in Somerset and 55 at Prestwick in Ayrshire. In addition to the Nimrod cancellation, the early withdrawal from service of the Harrier fleet will lead to potential job cuts of 119 at Samlesbury in Lancashire and 668 at Warton, Lancashire. The Harrier fleet decision may also mean cuts of 127 jobs at RAF Cottesmore in Rutland and 214 at Farnborough in Hampshire.

Last month, the Treasury published a letter from BAE Systems, which warned of 5,000 job losses if the government cancelled production of one planned aircraft carrier. The prime minister later announced both planned carriers would be built, but only one would be put into full service.

BAE Systems has 107,000 employees globally and reported sales of £22.4 billion in 2009.

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