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Abu Dhabi, UAEMonday 17 December 2018

Nearly 2,000 jobs to go at UK’s BAE after slowdown in jet fighter orders

Redundancies are a fresh blow to the government of Theresa May ahead of Brexit

A member of staff works in the cockpit of an aircraft on the Eurofighter Typhoon production line at BAE systems Warton plant near Preston, northern England. Phil Noble / Reuters
A member of staff works in the cockpit of an aircraft on the Eurofighter Typhoon production line at BAE systems Warton plant near Preston, northern England. Phil Noble / Reuters

The British defence company BAE Systems is cutting nearly 2,000 jobs following a failure to secure a major new deal with Saudi Arabia for its Eurofighter Typhoon jet, the company confirmed on Tuesday.

The job losses are part of a restructuring put in place by the company's new chief executive Charles Woodburn, and come after a slowdown in orders for its Typhoon and Hawk jets.

Production had already slowed at two plants in north west England involved in making the Typhoon jet. The current level of orders prompted Tuesday’s decision to cut the company's workforce by 1,400. Another 525 jobs will go in its maritime and intelligence divisions, BAE said.

More than 500 Eurofighters have been delivered to five European countries and Saudi Arabia. However the company this year has won fewer orders than France’s Dassault Aviation for its Rafale jet.

BAE delivered the last jets of a 72-plane order to Saudi Arabia this year. Attempts to secure a follow-up deal have, however, proved elusive.

The company secured agreement to sell 24 Typhoons and six Hawk jets to Qatar in September but cited uncertain timing on sealing the contract for reducing the level of production. The group, which employs 34,600 people in Britain, said it remained confident of securing new orders.

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“Negotiations are progressing to agree a contract with the government of Qatar, which, if secured, would sustain Typhoon production jobs, and manufacturing well into the next decade,” the company said in a statement.

The Typhoon programme is a joint project between BAE, France’s Airbus and Italy’s Finmeccanica, but has been dogged by cost problems, technical issues and project over-runs.

The bulk of the jobs will go in Lancashire, north west England, where some 5,000 people work on the Typhoon programme.

Unions said the decision was “devastatingly short-sighted” that undermined Britain’s defence capability. “These are world class workers with years of training and expertise on which an additional four jobs rely upon in the supply chain,” said Steve Turner, the head of the Unite union. “The UK government must take back control of our nation's defence and with it, play its part in supporting UK defence manufacturing jobs.”

The BAE job losses come as a further blow to the UK government, which had faced criticisms after the US announced punishing duties last month on another plane maker, Bombardier, threatening thousands of jobs in Northern Ireland.

The Bombardier setback was seized on by critics to highlight the challenges facing the UK ahead of Brexit, with the government having previously highlighted the importance of striking a new trade deal with the United States after leaving the European Union.

A UK government spokesman said: “BAE Systems have taken this decision as a result of internal restructuring. It is clearly a concerning time for their workers and the Government stands ready to support those affected.

“Our [Ministry of Defence] spent £3.7 billion [Dh17.8 bn] with BAE last year, and we also continually bang the drum for our world-leading defence industry right across the globe, supporting companies like BAE in securing contracts for UK-made equipment.”