Merger complicates consortium bids

British Aerospace’s £7.7bn merger with Marconi Electronic Systems has led to a re-think over consortium bids for big defence projects where the two companies are in rival camps. The two claim that they are still competing head-to-head for the £180m joint British/US Tracer armoured reconnaissance vehicle project, for which first contracts are imminent. BAe is […]

British Aerospace’s £7.7bn merger with Marconi Electronic Systems has led to a re-think over consortium bids for big defence projects where the two companies are in rival camps.

The two claim that they are still competing head-to-head for the £180m joint British/US Tracer armoured reconnaissance vehicle project, for which first contracts are imminent.

BAe is part of the Sika consortium with Lockheed Martin, CDC, Pilkington, Vickers Defence Systems and Shorts Missile Systems.

Marconi leads the Lancer consortium with Raytheon, Alvis and United Defense.

But a Marconi source said that competition with BAe would hinge on whether the customer regarded this as plausible.

Meanwhile, BAe said it would mount a joint bid to build Britain’s new aircraft carriers once the merger goes through. BAe and Marconi are competing with four other firms for three £5m initial studies on the carriers due this autumn.