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BAE Systems announces closure of facility at Lochside, Edinburgh

16 Nov 2005

BAE Systems announced today that it will close its facility at Lochside, Edinburgh, in 2006, with the potential loss of up to 260 jobs. The decision to close the engineering and product development facility is driven by a defence market environment that provides fewer opportunities for the large, customer-funded development projects that have historically sustained the business.

Work currently performed at Lochside will transfer to the BAE Systems Avionic Systems headquarter site at Rochester, Kent.

The defence markets we serve are changing rapidly and we have responded to these changes by strengthening our business-winning capabilities by investing in new products and continuing to reduce our costs, said Mike Austill, managing director of BAE Systems Avionic Systems. However, feedback to date in the marketplace indicates that our strategy is not materialising at the pace that we had previously forecast. We now recognise that we must further reduce our costs to make our offerings more competitive.

The company today notified the Department of Trade and Industry of the proposed workforce reduction. It is anticipated that employees will leave the business from mid-February through late June next year, following the completion of the consultation process with employee representatives. A small number of opportunities will exist for Lochside employees to transfer to the Rochester site.

This decision has not been taken lightly, Austill said. Having considered all other options available, these actions are necessary to ensure the competitive position and the medium- and long-term future of the business. We will offer support and assistance to everyone affected by this announcement, including career counselling and outplacement advice. In addition, I appreciate all the support given by the community to this business during its many years of residence in Edinburgh.

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:

Rajeev Gupte, BAE Systems
Tel: +44 (0) 1634 204487, Mob: +44 (0) 7801 718022
rajeev.gupte@baesystems.com



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