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NEWS IN BRIEF

Sep 04. The Defence Procurement Agency (DPA) and the Defence Logistics Organisation (DLO) spend £6,000m and £5,500m with Industry each year. About one-third of the combined £11,500m is spent with just nine suppliers: AgustaWestland, Alvis, AMS, BAE SYSTEMS, MBDA, QinetiQ, Rolls-Royce, Thales and the VT Group. A further nine companies complete the list of 18 Prime Key Suppliers identified by the MoD: ABRO (Army Base Repair Organisation), Babcock, DARA (Defence Aviation Repair Agency), EADS, GD UK, Halliburton KBR, Lockheed Martin, Raytheon and Serco. Comment: As listed in the ‘Defence Contracts Bulletin’ (25 Aug 04), the MoD currently designates 39 companies as Key Suppliers; the above 18 and an additional 21. The Key Supplier list is not static and “companies will join and leave it as the pattern of their business with the MoD changes”. (Source: DEFENCE NEWS ANALYSIS, Issue 04/34, 06 Sep 04)

Sep 04. Mike Turner, BAE’s chief executive, describes its shipbuilding business as “a problem of a large amount of turnover with no profits”. Sceptics would argue the same could be said of BAE’s entire UK programs business. Why either might be considered a realistic sale candidate is puzzling. Shipbuilding was put on the block by BAE in April. Management argued its retention amounted to a poison pill preventing BAE’s takeover by US defence majors that were averse to such metal-bashing activities. One sale was meant to facilitate the other. Reality has now bitten. In June, BAE paid £253m for Alvis, a metal basher par excellence – a 52 per cent premium to its pre-bid market price. The deal suggests vertical integration is a necessity rather than an anachronism in UK defence. More importantly, shipbuilding has failed to attract buyers. This partly reflects its lack of transparency. Costs relating to the Astute nuclear submarine contract have been capped, but the other main project, the Type 45 destroyer, is vulnerable to cost overruns. Does it follow that BAE is no longer for sale? In fact, the improbability of a US takeover of BAE is now primarily explained by the reluctance of the US government to share defence technology with foreigners. But the ships disposal is an indicator of BAE’s desire to detach itself from UK dependence and pursue its transatlantic dream. If, at the board meeting, BAE’s new chairman announces ships are to stay, it probably means he thinks BAE’s independence will too. (Source: FT)

25 Aug 04. Saab conducted its first totally autonomous flight with its unmanned aerial vehicle, the SHARC technical demonstrator. SHARC took off, flew and landed completely according to plan, and Saab can now count itself among the few companies to succeed in conducting a totally autonomous flight. The flight took place during a test campaign at the Swedish Defence Materiel Administration test site in Vidsel. After taking off without pilot assistance, the SHARC performed a totally autonomous mission before landing on its own, aided by differential GPS and a radar height finder. The SHARC technical demonstrator has been developed by Saab. The project began in 2001 and the first flight was conducted in February 2002. The test campaign recently carried out in Vidsel is the third in order. The previous test campaigns, which included autonomous flights both within and beyond the point of visibility, laid the foundation for the successful autonomous take-off and landing. Successfully completing totally autonomous flights – i.e. flights with no pilot assistance whatsoever – is an important stage in Saab’s development of autonomous UAVs.

Aug 04. Toyota just launched a new vehicle in Indonesia, called Kijang Innova. This is as part of a plan to improve its global production and supply network. The firm says it hopes to produce 80,000 units a year in West Java and export about 10,000 to Asia, the Near and Middle East. The new vehicle is the second of five IMVs – short for ‘innovative international multi-purpose vehicles’ – developed for sale

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