BAE reveals dramatic cut to Typhoon production rate

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The Eurofighter programme's annual production rate is to be slashed dramatically as partner nations Germany, Italy, Spain and the UK battle economic difficulties.

Details of the reduction emerged as BAE Systems announced plans to axe about 3,000 jobs at several of its sites around the UK, including its Eurofighter Typhoon final assembly site at Warton in Lancashire.

"The four partner nations in the Typhoon programme have agreed to slow production rates to help ease their budget pressures," said BAE chief executive Ian King.

Four final assembly sites around Europe had been configured to deliver up to a combined 60 Typhoons a year, with 53 planned in 2011, but BAE has confirmed that this rate is to be progressively cut to only 35. This decision has contributed to a plan to axe 843 staff at Warton and in Preston, Lancashire, the company said.

A BAE source noted that the decision to extend the production schedule will enable the Eurofighter consortium to keep its final assembly lines active while it pursues several international sales opportunities.

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Eurofighter said the multinational agreement will see production fall to a rate of 43 a year by late 2012, before later being reduced further to 35. This is expected to extend Tranche 3A production of the type by at least two years until late 2017.

The move will also buy more time for industry partners Alenia Aeronautica, BAE and EADS to secure a planned Tranche 3B production order. Negotiations had been hoped to resume in late 2011, but sources suggest this can also now be deferred by up to two years.

India is expected to open bids for its medium multi-role combat aircraft requirement from mid-October, with the Typhoon facing up to Dassault's Rafale for the initially 126-unit deal.

Also on 26 September, BAE responded to Japan's request for proposals for a McDonnell Douglas/Mitsubishi Heavy Industries F-4 replacement, with the Boeing F/A-18E Super Hornet Block II and Lockheed Martin F-35 also in contention for the F-X deal.

Sources suggest a proposed government-to-government sale between the UK and Oman continues to progress, but a Typhoon contract signature is unlikely to emerge before 2012.

BAE also announced that 899 jobs are expected to go at its Military Air & Information site at Brough in Yorkshire, with the bulk of these linked to its Hawk advanced jet trainer programme.

Further manufacturing linked to the platform will be performed at its nearby Samlesbury site in Lancashire, although about 565 positions are also expected to be cut at this facility.

Some of these are linked to the slower-than-anticipated increase in the production rate for the Lockheed F-35 Joint Strike Fighter, the company said.

The remaining cutting of about 700 jobs will be implemented at 10 other BAE sites in the UK, including around 78 at its Farnborough headquarters in Hampshire. More than 100 will also go at UK locations including Royal Air Force bases, with this development linked to the early retirement of the Harrier GR7/9 and a fleet-size reduction to the service's Panavia Tornado GR4 force.

"Our customers are facing huge pressures on their defence budgets, and affordability has become an increasing priority. Our business needs to rise to this challenge to maintain its competitiveness and ensure its long-term future," said King.

"To ensure we remain competitive, both in the UK and internationally, we need to reduce the overall costs of our businesses in line with our reduced workload."