Agustawestland lands £760m Ministry of Defence contract

HELICOPTER-maker AgustaWestland has been given a boost by a £760m contract from the Ministry of Defence that will secure about 1,000 skilled jobs at its Yeovil factory in Somerset and other sites.

The work to upgrade and maintain military helicopters – such as those flown by Army Air Corps aviator Prince Harry on operations in Afghanistan – was announced by Defence Secretary Philip Hammond.

It includes £430m to maintain and support the fleet of Apache attack helicopters ( pictured) for five years and £330m to upgrade the RAF’s Merlin MK3/3a helicopters for the Royal Navy’s Commando Helicopter Force.

Hammond said: ‘This investment will help secure British jobs, providing security to thousands of workers and their families. The UK defence industry makes an important contribution to the economy, generating revenue of over £22bn each year, and its highly skilled workforce plays a crucial part in growing our economy.’

AW was recently hit with a bribery scandal in India over a £465m deal to supply 12 AW101 helicopters, which saw the contract ditched by the Indian government. The company employs about 3,500 staff and had warned a reduction in the workforce could be necessary following the cancellation of the Indian deal, and also said it may have to ‘consider reallocation of existing working capital that will be reflected on the supply chain’.

Like most of Britain’s aerospace and defence manufacturers, it relies on component parts and other materials from an army of small to medium-sized suppliers. However, the MoD deal will support 500 jobs in the supply chain of GE Aviation in Cheltenham, General Dynamics in East Sussex, Selex ES in Luton, and APPH Aviation Services in Cheshire.

Independent aerospace and defence analyst Howard Wheeldon said: ‘AgustaWestland is a superb organisation and the continued investment in the UK operation by the Italian-owned parent is now being rewarded with some significant orders.’