The troubled UK aerospace industry has received a welcome windfall after Lockheed Martin was awarded the contract to build the Joint Strike Fighter – a decision that could create up to 8,500 UK jobs in the sector.
The $200bn project, the biggest military equipment contract in history, could create work worth up to £27bn for UK defence aerospace suppliers during its initial development phase, with an extra £24bn over programme’s life.
Full production of the UK aircraft is planned to start in 2008, with the first jets due to enter service by 2012.
BAE Systems, a full partner in the successful Lockheed team, stands to take a 15% share of the work. The project will be important to BAE, as it is probably the last major manned combat aircraft programme, and promises to fit nicely at a time when development work on the Eurofighter is beginning to diminish.
Bombs and missiles
The JSF, intended to replace the Harrier and F-16 jets among others, will be used for attack and reconnaissance missions, and will carry precision-guided bombs and air-to-air missiles.
The aircraft’s rear fuselage will be designed and built at BAE’s Samlesbury site. The company will also be involved in the design of other key areas, such as mission systems, fuel and diagnostic system, autonomic logistics and airframes. Work on the JSF will also take place at sites in Warton, Edinburgh, Stanmore – and Rochester, where BAE’s team in the rival Boeing bid is based.
Martin Taylor, programme director for JSF at BAE, said the two teams were still prevented from talking to each other, but he confirmed that those who worked on the Boeing proposal would not lose their jobs. Meanwhile, he said the first Lockheed JSF would be flying in 48 months.
Under the initial $20bn development phase, the design will be completed and the 22 production models will be built. A BAE spokesman said the first phase will be worth £1.3bn to the company in the UK, with a further £0.5bn for BAE’s North American business, and will create 3,500 jobs, 2,200 of them in the UK. Once the JSF goes into full production the project will be worth £7bn to the firm’s UK operations, and £3bn in the US, and will take the job total to 4,000, he said.
‘We are now on all the major modern tactical aircraft programmes on both sides of the pond. That is where you want to be, as it preserves the appropriate level of skills, technology and capabilities needed for the future, and confirms our position as the global provider of airframes and systems in tactical aircraft.’
The US government will buy 3,000 of the aircraft, to replace most of its Air Force, Navy and Marine fighter jets. The UK will buy 150 for the RAF and Royal Navy. The UK government has contributed £1.4bn towards the engineering and manufacturing development stage, and the overall procurement cost to the UK could be up to £10bn.
Analysts believe the success of the Lockheed bid is also good news for Rolls-Royce, as its LiftFan system is more valuable than the Harrier-like ducting it was due to supply to Boeing.
Rolls-Royce is also partnered with General Electric on an engine option for the JSF, and the contract will be worth over $1bn to the firm. The company’s sites at Bristol and in the US will be the main beneficiaries of the programme, which is expected to secure up to 900 jobs split between the UK and US during the development phase.
But securing work on the JSF programme is not likely to lead to a reduction in the 3,800 job losses recently announced by Rolls-Royce. Full-scale component production will not begin at the company until 2006, while the 22 production aircraft to be developed in the meantime are not likely to compensate Rolls-Royce for the loss of orders for 400 civil aircraft engines as a result of the September 11 attacks.
Smiths Group predicts the decision will bring the firm’s aerospace division over $10bn of new business over the lifetime of the aircraft. Smiths Aerospace will gain £700,000 in production work for each aircraft built, and is hoping to secure more work when systems contracts still to be decided on are awarded. Chief executive Keith Butler-Wheelhouse described the project as ‘the biggest business opportunity ever for Smiths Aerospace.’
Electronics firm Cobham is producing the JSF’s fuel systems, while the UK’s Martin Baker has a contract to supply the ejector seats, and TRW Lucas will build the weapons bay door system.