BAE Systems nears decision on shipbuilding rationalisation

BAE Systems Maritime is now expected to announce decisions on the future size and shape of its surface warship building business in the first quarter of 2013, IHS Jane's understands.

The company's Naval Ships unit has been conducting a review of operations across its shipbuilding facilities in Portsmouth and on the River Clyde in Glasgow (Scotstoun and Govan) as it looks to rationalise the business commensurate with anticipated future workload.

At least one facility is expected to close, resulting in significant job cuts, with the Portsmouth yard seen as most at risk. The attendant implications for regional unemployment have seen the issue take on a heightened political profile in recent weeks.

While Naval Ships' yards are currently working on the manufacture of blocks and assemblies for the Royal Navy's (RN's) two new Queen Elizabeth-class aircraft carriers, workload tails off dramatically after 2015. The assumption is that from 2020 the UK will produce one complex warship – in the shape of the Type 26 Global Combat Ship – every 12 months, and develop a new ship design every six years; that level of workload will not sustain operations at three shipyards in their current form.