Implementing our strategy

• BAE Systems and its predecessor companies have developed extensive support capability in the Kingdom of Saudi Arabia over several decades
• Pilot projects launched within the UK based on this experience realised significant cost and efficiency benefits
• BAE Systems’ partnering approach took a significant step forward in 2006 with the UK Tornado support programme
• The partnered support model is being developed for other projects and in other markets, such as Australia

In response to customer demands BAE Systems has developed a partnered support approach which is providing cost savings and efficiencies for customers while developing a substantial and profitable stream of business for the Group.

For several decades BAE Systems and its predecessor companies have been developing a deep relationship in support of the armed forces in Saudi Arabia, principally the Royal Saudi Air Force. This highly successful relationship has provided a basis on which to develop support solutions programmes into other markets, most notably with the armed forces in the UK.

Initial pilot projects were established, identifying components of the UK’s military aircraft fleet where industry could bring enhanced efficiency to the management of parts, repair and overhaul. In an environment of severe cost restraint the benefits quickly became apparent, delivering reduced costs together with the operational benefit of enhanced availability.

Progressively, BAE Systems’ deeper involvement in support of the Royal Air Force (RAF) has been expanded across larger airframe assemblies and sub-systems leading to contracts to manage the maintenance and support of whole aircraft fleets. A combined maintenance and upgrade facility was established at RAF Cottesmore for the UK’s Harrier fleet, co-locating the RAF and Royal Navy engineering activities with those of BAE Systems.

The similar concept now in place for the larger fleet of Tornado aircraft in the UK enabled aircraft down-time for maintenance to be optimised to facilitate modifications and systems upgrade to take place concurrently. Combined maintenance and upgrade has reduced traditional maintenance manhours by 50%. Highlighting the success of this programme, the UK government’s National Audit Office reported in 2007 that these arrangements had contributed to savings of £1.3bn over the past five years on Tornado support, with a 51% reduction in Tornado flying hour costs.

At the end of 2006 the Group’s partnership approach to supporting the UK’s armed forces took a further major step forward with the signing of the ATTAC (Availability Transformation: Tornado Aircraft Contract) agreement. ATTAC is potentially worth £1.5bn and includes on-aircraft maintenance of the Tornado GR4 aircraft fleet, spares support, technical support and training. Under the ATTAC agreement, BAE Systems has taken responsibility for deep support at RAF Marham and combines this with a capability development and sustainment service as a structured and cost-effective approach to inserting new capability into the aircraft, so as to maintain its war-fighting effectiveness throughout its service life. ATTAC is an availability contract where BAE Systems is responsible for ensuring the required aircraft, at an agreed capability, are provided to the front-line when they are required.

Similar opportunities exist across a number of areas, including new platforms such as Typhoon and those due to enter service, such as the MRA4 Nimrod. In addition, similar partnered support arrangements are being developed across the UK’s armoured fighting vehicle fleets and in UK naval support.