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Innovative Support And Partnership Agreements Deliver Significant Savings To The UK MOD

13 Sep 2005

BAE Systems commitment to cost saving partnerships with the UK Ministry of Defence was underlined recently with the award of a 60 million support contract for the AS90 155mm self-propelled gun.

The 60 million contract, awarded to BAE Systems by MoDs Defence Logistics Organisation, ensures improved logistics support for the British Armys AS90 guns and the MoD will save around 29 million over the next five years.

On announcing the contract, Lord Drayson said: The partnering contract demonstrates the innovative way MoD and industry are working together to produce new cost effective support solutions. Industry has greater flexibility to provide the required support in the most efficient way, ensuring our Armed Forces continue to have the best support available.

Since the Equipment Support Agreement, (ESA) was awarded BAE Systems has mobilised a joint BAE Systems / MoD team based at Andover, Barrow and Leicester, to deliver the contract. The team has taken management control of supplying spares and repairs on demand and has implemented a helpdesk to provide co-ordinated technical support to the user.

The team has met its first 3 milestones since the contract began and is working to deliver full capability by early 2006, when the MIS (Management Information System) in the form of AMTS (Asset Management Tracking System) and e-Capability rolls out.

Separately, BAE Systems has delivered a 16million cash payback to the UK MoD following the success of a partnership agreement for the supply of conventional munitions to support operations and training.

A gainshare mechanism within the agreement provides an incentive for the delivery of continuous improvement in products and in manufacturing or business processes.

The existence of the framework partnering agreement has enabled the Defence Logistics Organisation and BAE Systems to work much more closely together to achieve the common goal of providing the end user with safer munitions at lower through-life costs.

About BAE SYSTEMS

BAE Systems is an international company engaged in the development, delivery, and support of advanced defence and aerospace systems in the air, on land, at sea, and in space. The Company designs, manufactures, and supports military aircraft, combat vehicles, surface ships, submarines, radar, avionics, communications, electronics, and guided weapon systems. It is a pioneer in technology with a heritage stretching back hundreds of years and is at the forefront of innovation, working to develop the next generation of intelligent defence systems. BAE Systems has major operations across five continents and customers in some 130 countries. The Company employs over 90,000 people and generates annual sales of approximately 14.8 billion through its wholly owned and joint-venture operations.

For further information, please contact:

Greg Trew, BAE Systems
Tel: +44 (0) 1252 384029
greg.trew@baesystems.com



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