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Thousands of UK jobs at risk as uncertainty grows over vital helicopter contract

December 10, 2024

Fears are mounting for the future of a West Country helicopter factory and its 3,000-strong workforce as the government drags its heels on a much-anticipated £1 billion defence contract.

The Yeovil site, owned by Italian defence giant Leonardo, had been counting on the so-called New Medium Helicopter (NMH) programme to replace the RAF’s ageing Puma fleet.

Despite the Ministry of Defence confirming last month that the existing Pumas will be retired next March, it has yet to award a contract to secure their successor. Leonardo currently stands as the sole bidder after Airbus and US rival Sikorsky withdrew from the running, but prolonged delays have sparked concern that ministers could abandon the project altogether.

Industry insiders and union leaders warn that scrapping the NMH contract would be a severe blow to UK aerospace, with Leonardo’s Yeovil factory potentially facing a severe downturn. Some speculate that the government’s looming defence review could lead to cost-saving measures, such as substituting Pumas with other existing helicopter types—like Chinooks—rather than ordering a new fleet.

Sharon Graham, General Secretary of Unite, recently met Defence Secretary John Healey, urging him to press ahead with a decision to safeguard the highly skilled roles at Yeovil. “We have heard the government’s warm words for the defence sector; now we need concrete action,” Graham said. “Any further delay would be disastrous for these workers and the long-term future of this factory.”

Defence Procurement Minister Maria Eagle offered little reassurance when pressed in Parliament. While there are currently no plans to alter the original NMH tender, Eagle indicated that an appraisal process would continue into next year, after which any contract would require government approval.

With the Chancellor, Rachel Reeves, focused on trimming public spending, the fate of the NMH deal hangs precariously in the balance. An industry source described the atmosphere as one of uncertainty: “No one can be sure whether the contract will go ahead. Replacing Pumas using Chinooks would be a stretch, but in a climate of tough choices, it might seem more attractive to the Treasury.”

Airbus, which had once promised to build a new helicopter assembly site in Wales if it won the contract, abandoned the competition earlier this year, accusing the MoD’s terms of failing to deliver sufficient commercial returns. That left Leonardo the only remaining bidder with its AW149 design.

The MoD had initially planned to acquire up to 44 helicopters, but this figure is now believed to have been cut to around 25, including six H145 Jupiter aircraft recently purchased from Airbus to cover operations in Cyprus and Brunei.

The Chancellor has indicated that no final decisions on defence spending will be made until after the forthcoming defence review. However, she has pledged to increase defence expenditure to 2.5 per cent of GDP over time. For now, Britain’s aerospace workers in Yeovil face a nervous wait, as the government weighs their futures against the demands of tighter budgets and shifting priorities.