British gov't to step up role in selling BAE's Typhoon to Saudi Arabia

BAE is depending on new Typhoon orders, from countries likely to include Saudi Arabia, to meet its financial forecast
British gov't to step up role in selling BAE's Typhoon to Saudi Arabia
(AFP/Getty Images - for illustrative purposes only)
By Reuters
Wed 16 Sep 2015 04:12 PM

The British government will step up efforts to help BAE Systems sell more Typhoon fighter jets, a key programme for the defence contractor, British suppliers and jobs, the defence minister said.

BAE is depending on "anticipated" new Typhoon orders, from countries likely to include Saudi Arabia, to meet its forecast for marginal earnings per share growth in 2015. It has also said it needs new orders to keep production of the Typhoon going at British factories beyond 2018.

Britain's defence industry body, ADS Group, has called on the government to do more to help exporters, saying government-to-government deals are important for exports.

The Typhoon has attracted fewer orders this year than the rival Rafale built by France's Dassault Aviation, which sealed sales to Egypt and Qatar with the involvement of French President Francois Hollande.

"We will be stepping up the MOD's (Ministry of Defence) role in export promotion," Michael Fallon, defence minister, told a conference on Wednesday. "The MOD will now lead on key strategic export campaigns, including Typhoon and complex weapons."

The Eurofighter Typhoon is a joint project between BAE, France's Airbus and Italy's Finmeccanica which supports an estimated 40,000 jobs in the Britain.

The MOD declined to give more detail about its plans to promote exports at this point.

"One thing that would really make a difference is if the MOD had supporting exports as one of its core tasks," ADS Group Chief Executive Paul Everitt said at an event this month. "There is no budget line associated with it and the objectives of their staff are not aligned to making exports work."

BAE welcomed the government's plan.

As for Britain's Typhoons, the country will sign a contract worth more than 300 million pounds ($462 million) with European missile maker MBDA, part-owned by BAE Systems, to provide the jets with new air-to-air weapons, Fallon said.

The minister is working on a defence and security review due to conclude later this year. Defence companies hope it could state the need for a new maritime patrol force, and put a multi-billion dollar contract up for grabs.

Since scrapping the delayed and over-budget BAE Systems Nimrod MRA4 in 2010, experts say Britain has struggled to carry out aerial hunts for submarines and objects on the surface.

Fallon said Britain might address the gap: "Clearly that is one we will be looking at."

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