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Royal Navy Awards BAE Systems Contract To Design New Warship

The Royal Navy awarded BAE Systems a contract to aid in the design and development of the new Type 26 frigate. The four year contract is worth almost $250 million. The new vessel will replace the aging Type 22 and 23 frigates.

The contract will keep jobs in Scotland for several years. The actual contract to build the new warships will be let in a few years with a goal of the first delivery in 2020.

The Royal Navy is planning major new construction programs for aircraft carriers as well as strategic missile submarines. The budget pressure the U.K. is under is extreme as the costs of fighting in Afghanistan along with social spending may restrict the money available to the RN and RAF in the next few years. Thousands of jobs building ships hang in the balance as these contracts are awarded and move forward. Scotland especially is dependent on the aircraft carriers to go forward as a way to keep their economy going.

The next years may be key to the future of the Royal Navy.

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BAE Systems Working On Future Royal Navy Ships

The Royal Navy has one major program underway right now. This is the new aircraft carrier which hopefully will deliver the two largest carriers used by the service in its history. Now BAE Systems has announced that they are designing the new surface combatants that will support these ships as well as perform general duties. The company has just started on a preliminary design for the two destroyers. If all goes well a production contract will be awarded in about ten years. The RN hopefully will buy up to twenty of these ships.

The U.S. Navy’s DDG-1000 and Littoral Combat Ship (LCS) programs are their new warships but those programs have suffered from development and cost issues. Right now the DDG-1000 is on hold while the U.S. continues to build DDG-51 class ships. The LCS program was to have two different designs built by Northrop and General Dynamics but now a down select is planned for one ship only.

The British Government faces major budgetary pressures due to the world’s economic doldrums and social spending. This along with the cost of operations in Afghanistan may lead to limits on how many ships may be built in the future. The carrier program itself may be delayed if funding issues persist. Despite the need for new surface ships it is not necessarily the best time for programs like this.

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Littoral Combat Ships (LCS) See Growth In Prices

The Littoral Combat Ship (LCS) is a new class of light warships for the U.S. Navy designed to fight close inshore and have the ability to mix-and-match its systems to the mission requirements. The Navy currently has ordered four of the controversial ships two each from Northrop Grumman and General Dynamics. The plan is to buy three more in 2010 from one or both of the contractors.

Due to cost growth in the first two ships the Navy had at one point had canceled the contracts for ships 3 and 4. Congressional pressure made them order these next two ships. The initial estimate was that the ships would cost $220 million on average but the price tags have slowly escalated over time. Now LCS 1 is estimated to cost $637 million and hull 2 $704 million. Congress has placed a cap of only $460 million for the average cost. The Navy originally intended to build over fifty of the vessels.

With the continued cost growth of the existing program it is hard to see how the Navy can continue it. There will have to be a restructuring of the costs and number of ships planned. If not the program will like the bigger DDG-1000 class look like a good candidate to end with the Navy having to accept a new design or continue constructing existing ships.

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New British Aircraft Carriers Have Trickle Down Effect

Even though you can project the Royal Navy at being two carriers and twenty or so escorts the most expensive ship building contract in the UK’s history is having an economic effect. The Engineer Online reports that three major sub contracts were awarded worth over $130 million to support construction of the two new ships. The contracts are for insulation, water management systems and command and control systems. Thales will provide the internal ships communication system as well as an HF long range radio. Ormandy Group will build the system for treating and providing hot and cold water for the ship. Finally Ticon Ltd UK will supply various types of insulation for the ship. These two large warships will continue to generate revenue and jobs for a variety of companies across England.

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