BAE to Cut About 740 Jobs at Five Military Air Solutions Locations in U.K.

BAE Systems Plc, Europe’s largest defense company, plans to cut about 740 U.K. jobs at its division supplying parts for military aircraft such as Lockheed Martin Corp.’s F-35 Lightning II.

The unit employs 15,000 and the cuts may affect sites in Brough, Chadderton, Warton, Samlesbury in northern England, and Farnborough, west of London, spokeswoman Leonie Foster said by phone today. The company employs about 107,000 people globally.

“We appreciate that this is going to be difficult news for our employees but we remain committed to working to explore ways of mitigating these potential job losses,” Foster said.

The U.K. is due to complete its review of defense and security capabilities by the end of next month as the government aims to cut a record budget deficit. Findings from the review will help fuel Chancellor of the Exchequer George Osborne’s Oct. 20 announcement on spending cuts.

The U.K. government has asked BAE to provide a cost of its aircraft-carrier program as officials complete their first defense-policy review since 1998, according to the British contractor’s Chief Executive Officer Ian King, who went before Parliament’s defense committee yesterday.

Lockheed Martin, the world’s largest arms supplier, said yesterday about 25 percent of its executives opted for a voluntary retirement program designed to cut costs as U.S. defense spending slows.

Any compulsory firings at BAE will be opposed by unions, according to Hugh Scullion, general secretary of the Confederation of Shipbuilding and Engineering Unions.

“The unions are shocked at the scale of these losses and will be demanding an explanation from BAE,” Scullion said in an e-mailed statement.

To contact the reporter on this story: Howard Mustoe in London at hmustoe@bloomberg.net.

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