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Thursday April 30, 04:01 PM
Fall In Army Orders Costs 500 BAE Jobs

By © Sky News 2009

Fall In Army Orders Costs 500 BAE Jobs
Click to enlarge photo
A drop in orders from the British Army has forced defence firm BAE Systems to close three UK plants, with the loss of 500 jobs.

Europe's biggest military contractor is to close factories in Telford, Leeds and Guildford, partly because of the withdrawal of British troops from Iraq.

Some of the job losses will come in Barrow, Newcastle and Leicester.

The firm said in a statement: "The announcement follows the UK decision to postpone the FRES - Future Rapid Effects System - utility vehicle acquisition and a downturn in work supporting British Army operations in Iraq and Afghanistan."

BAE said 330 of the 500 jobs would go as a result of the plant closures.

It will axe a further 90 posts in Barrow due to slowing production of its M777 lightweight towed howitzer for the US military.

The sites and jobs affected are all at the company's Global Combat Systems (GCS) Vehicles and Weapons businesses, which currently employ 1,820 people in the UK and have already suffered 200 job cuts announced in November 2008.

"While we clearly regret having to take this step, our forecast UK order intake has reduced and we have to match the size of our business appropriately to the projected nature and volume of workload," GCS managing director David Allott said.

Shares in the company, which had been trading flat ahead of the statement, turned positive on the news to trade 1.2% higher.

Meanwhile, Britain was hit by further job losses at supply chain group Wincanton, which was set to axe up to 283 staff from its home delivery unit.

And historic piano factory Kemble and Co announced it is to close with the loss of nearly 100 jobs.

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