Cuts ‘help keep BAE competitive’

DEFENCE giant BAE Systems said the early implementation of its programme of cuts which will see it shed 3,000 jobs from sites in Lancashire and East Yorkshire would help to underpin its competitive position.

The firm said that “constraints on government expenditure in many of the Group’s principal markets” meant that it had to make efficiency improvements.

In a statement to the stock exchange this morning, the company said that uncertainty surrounding defence budgets – particularly in the US – meant that it had to take action. A planned reduction in the production rate for its Typhoon planes was also cited as a factor.

“Major cost reductions have been, and continue to be, implemented to address changes in customer priorities and, in some areas, reduced business activity,” it said.

The company said that trading for the half-year to July 28 remained in line with expectations, but some “near-term disruption” to trading is expected as the US administration grapples with reducing its federal budget.