AgustaWestland responds to UK defence cuts with Yeovil redundancies

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AgustaWestland is the latest defence contractor to announce big job cuts in response to slowing defence spending, with up to 375 proposed redundancies at its UK operations.

The company blames reduced helicopter purchases by the UK Ministry of Defence, as well as slowing export sales. The exact number of redundancies has yet to be determined, and the company has launched a voluntary scheme to minimise the number of compulsory cuts it will have to make.

The final number will be known in early 2012, following a 90-day consultation period, but could be in excess of 10% of AgustaWestland's UK workforce of 3,600, of which 3,400 are based at Yeovil, Somerset.

The move follows BAE Systems' late September announcement that it was reducing its UK workforce by nearly 3,000 in response to spending cuts in programmes ranging from the Eurofighter Typhoon to Hawk trainers and Tornado attack jets.

AgustaWestland, a division of Finmeccanica, hopes to shift reliance away from defence business with the introduction of its AW169 multi-purpose civil helicopter, which is being readied for delivery from 2015.

The company expects to sell 1,000 of the 10-seat models over 25 years, to transport offshore operators and for law enforcement and surveillance duties.

The AW169 will make its first flight next year, and one of four prototypes will be based at Yeovil, which is focusing its attention on main and tail rotor and transmission development.

However, AgustaWestland readily admits that in the short term the Yeovil plant, which assembles the AW101, Super Lynx and AW159 models, will increasingly have to make do with ongoing support activity for the UK armed forces.

It has yet to be decided how Yeovil will fit into the AW169 programme once it moves from development into production, and there is no guarantee the plant will be a mainline production centre. The AW139, for example, is assembled in Italy and the USA, with a third plant soon to come on stream in Russia.

Managing director Ray Edwards said: "These steps together - the increased civil aircraft work-flow, the launch of the AW169 and the streamlining of the workforce - will place our UK operation on a strong footing and enable us to keep the skills needed for the UK to retain a viable helicopter capability.

"Our military business remains central to our success. This said, extending our capabilities in civil production and competing for export programmes, both areas where the government has shown considerable support, are the keys to AgustaWestland's future."