BAE Systems eyeing 1000 job cuts - report
BAE Systems' new boss is preparing to trim the defence group's workforce by at least 1,000, according to a report on Monday.
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Charles Woodburn, the oil executive who joined the defence contractor as chief operating officer last year ahead of his promotion to chief executive this June, will get rid of well over 1,000 jobs, according to Sky News.
BAE is scheduled to deliver a trading statement on Tuesday.
The rumoured job cuts come despite last month's news that the UK government had secured a contract with Qatar for BAE to assemble 24 Typhoon fighter jets, worth at least £2bn across the four-nation consortium behind the Eurofighter.
Alongside August's half-year results, where underlying operating profits rose 11%, cash flow returned to positive territory and it's net pension deficit was slimmed to £5.9bn, Woodburn said he would "continue to focus on efficiency and meeting our customers' affordability challenges", citing an expected improvement in the defence budget outlook in a number of markets as leaving the group "well placed".
Defence secretary Michael Fallon recently said Britain should increase its defence spending target above the current 2% of GDP and announced a £1bn support package for the Royal Navy fleet.
But some City analysts have raised worries about the absence of further export order for the Typhoon programme.
If no further Typhoon export orders are secured within the next 12 months, Berenberg said earlier this month that it would see a 3% headwind to earnings in the 2020 financial year.
Union Unite demanded a meeting with BAE and for management to "come clean", also calling on the government to "buy British" by committing to building the next generation fighter jets in the UK in order to protect manufacturing jobs.
The union estimated that by 2020, a quarter of the UK’s defence spend will be "benefiting American factories and companies such as Boeing and Lockheed Martin".
Unite assistant general secretary Steve Turner said: “BAE must also come clean on its plans. Unite is demanding urgent discussions with the company.
“If these job cuts materialise it will significantly undermine our nation’s sovereign defence capability and leave us reliant on foreign powers and foreign companies for the successor to the Typhoon and the defence of the nation.
“Ministers should be under no illusion. Once these jobs are gone, they are gone for a generation and with them the skills and ability to control our own defence and manufacture the next generation of fighter jets and other defence equipment in the UK.
“The ripple effects down the supply chain and through our manufacturing communities would be immense too, hitting the workforces in other cutting edge companies that are involved in the manufacture of one of the best fighter jets in the world, as well as depriving communities of decent well paid jobs."