UK defence giant BAE Systems PLC (LON:BA.) has delivered a blow to the UK government and the manufacturing sector after it announced plans to cut almost 2,000 jobs – double what was being bandied around yesterday.
The FTSE 100 firm, which makes the Eurofighter Typhoon jet as well as Britain’s nuclear submarines, will axe 1,400 roles from its military air & information business, along with a further 375 jobs in its maritime services division and 150 in its applied intelligence business.
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BAE’s aerospace bases at Warton and Samlesbury in Lancashire will be worst hit, with 750 job losses expected. Another 400 posts will be axed in Brough, east Yorkshire, 340 in Portsmouth, 245 at RAF Marham in Norfolk and RAF Leeming in North Yorkshire, and 150 in London, Guildford and at other applied intelligence locations. There are a further 30 job losses at other UK locations.
BAE it was forced to reduce its headcount following a lack of orders for its Typhoon jets and that the cuts would help to keep the company “efficient” and “competitive”.
The London-based group has struggled to win new orders for its jets, with its rival Rafale, built by France’s Dassault Aviation, being favoured by the likes of Egypt and Qatar.
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BAE – which is worth almost £20bn – did agree a deal with Qatar for 24 Typhoons last month, and a potentially lucrative contract from Saudi Arabia is still under negotiation, but it had hoped for more interest.
The cuts are expected to come into force in January as part of a wider set of “organisational changes” being brought in, which includes creating a chief technical officer role and tweaks to its various divisions.
BAE shares were down 0.7% to 614.3p in late afternoon trade.
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