LONDON \u2014\u00a0Supply chains for two of Britain’s largest defense programs have benefited in the last few days from a rush of production contract awards by industry primes BAE Systems, General Dynamics and Lockheed Martin.<\/p>\n\n\n\n
By early August, with Parliament on its summer recess and people’s minds here turning to the beach, it’s normally a quiet time on the announcement front for defense.<\/p>\n\n\n\n
The last few days were different, though. Fourteen contracts from across supply chains that include equipment from Austria, Germany and the US, as well as\u00a0the UK, were announced for three British programs.<\/p>\n\n\n\n
The contracts illustrated the increasing globalization of defense supply chains and emphasized the continued\u00a0willingness of the British to look overseas for equipment.\u00a0It’s something the British government hopes to see reciprocated more by its allies.<\/p>\n\n\n\n
International supply chains, and Britain’s role in them, were on British Procurement Minister Philip Dunne’s mind when he visited Washington recently and talked up Britain’s ability as an equipment supplier.<\/p>\n\n\n\n
“We have been actively encouraging US and other non-UK domicile primes to come into the UK to explore our supply chain,” he said in a speech July 28.<\/p>\n\n\n\n
The relationship is the most fruitful with the US, but even here he said he found it curious the trade “often seems to go largely in one direction. Put simply, we buy a lot more from you than you buy from us,” he said.<\/p>\n\n\n\n
It’s not all a one-way street, though. Lockheed Martin reckons it\u00a0spends \u00a31 billion (US $1.56 billion)\u00a0a year with its UK supply chain, while Raytheon estimates it\u00a0spends around \u00a3600 million \u2014\u00a0in both cases much of that is spent by the significant local operations both companies maintain here.<\/p>\n\n\n\n
Outside of the US, Dunne pointed to naval shipbuilding as a sector where Britain could enhance its international equipment supplier credentials.<\/p>\n\n\n\n
While he noted that many nations wanted to handle shipbuilding as a matter of national pride, “many of those nations don’t have the design capacity to build everything which goes into them,” he said.<\/p>\n\n\n\n
Almost on cue Aug. 5<\/span>, BAE naval ships business announced Aug. 5\u00a0seven contracts worth in excess of \u00a3170 million with suppliers from the UK and overseas for equipment to be installed on the first three of what it is hoped will be a 13-strong fleet of Type 26 anti-submarine warfare\/general purpose frigates for the Royal Navy.<\/p>\n\n\n\n General Dynamics UK and Lockheed Martin UK also weighed in with four supply chain contracts worth a total of \u00a3290 million for the Scout Specialist Vehicle program. set to<\/span> The program will provide the British Army with a new family of medium-weight tracked armored vehicles, with deliveries planned to begin\u00a0planned to start being handed over <\/span>in 2017.<\/p>\n\n\n\n Seemingly not wanting to be left on the sidelines, t <\/span>The Ministry of Defence late last week also got into the act,\u00a0as well <\/span>awarding around <\/span>about \u00a380 million of business to put a spring in the step of 12 of the 13 strong <\/span>Type 23 frigates,\u00a0fleet <\/span>with new diesel power generation systems manufactured by Rolls-Royce Power Systems in Germany and voltage converters from Hitzinger of Austria.<\/p>\n\n\n\n The Type 23s, which are also undergoing a systems and weapons update,<\/span> have been the backbone of the Royal Navy surface fleet for years and are undergoing upgrades to its systems and weapons.\u00a0with the first built in 1985 and the last in 2002.<\/span><\/p>\n\n\n\n On the Type 26, BAE signed production contracts with Babcock, David Brown Gear Systems, GE Power Conversion, Raytheon Anschuetz, Rolls-Royce Power Engineering, Rohde & Schwarz and WR Davis. as well as <\/span>BAE’s combat systems unit\u00a0will deliver an environmental system. being delivered by BAE’s own combat systems unit.<\/span><\/p>\n\n\n\n The contracts range from Rolls-Royce MT30 gas turbines to the integrated communications system from Rohde & Schwarz.\u00a0<\/span>Raytheon Anschuetz will deliver\u00a0the integrated navigation and bridge system. being delivered by Raytheon Anschuetz.<\/span><\/p>\n\n\n\n BAE is four months into a yearlong, \u00a3859 million\u00a0demonstration phase contract awarded by the government to allow the shipbuilder to continue with detailed design and purchase of long-lead items. while extended n <\/span>Negotiations over price and delivery for the first batch of warships have been extended.\u00a0are hammered out by the two sides.<\/span><\/p>\n\n\n\n Geoff Searle, BAE’s Type 26 program director, said the contracts “reinforced the strong momentum behind the program and is an important step toward\u00a0the start of manufacturing the Type 26 in Glasgow next year.”<\/p>\n\n\n\n The company hopes to have around <\/span>about 47 contracts placed with 30 equipment suppliers by the end of the demonstration phase.<\/p>\n\n\n\n Some <\/span>Roughly\u00a0\u00a3600 million of the demonstration phase deal will be spent on equipment supply.<\/p>\n\n\n\n BAE is looking to sign a production contract for the first three ships of the class after completion of the demonstration phase at the end of March\u00a02016.<\/p>\n\n\n\n Searle said BAE was still on track to cut the first steel for the Type 26 in late 2016, but that was contingent on a signing of the production contract.<\/p>\n\n\n\n Discussions over delivery of the first Type 26 continue, but 2021 or 2022 are likely dates allowing the Royal Navy to start pensioning off the first of its Type 23 fleet by 2023.<\/p>\n\n\n\n On the land systems front, a \u00a33.5 billion production contract for 589 Scout SVs from the British government last September is now translating into deals with the supply chain.<\/p>\n\n\n\n