Britain's largest defense firm, BAE Systems, has secured a £3.95bn ($4.82bn) contract to build a new generation of submarines as the AUKUS security pact between the UK, US, and Australia progresses.
The AUKUS pact, announced in March, is targeted at providing Australia with nuclear-powered attack submarines by the late 2030s. This ambitious initiative is designed to counterbalance China's regional ambitions and enhance security of the three Western nations.
Charles Woodburn, the CEO of BAE Systems, took great delight in his organization's participation in this crucial trilateral submarine development. The allocated funding will support development efforts through 2028, when submarine manufacture is expected to start. In the late 2030s, the first SSN-AUKUS submarine is anticipated to be delivered. These SSN-AUKUS submarines, which are based on British designs, will be used by both the UK and Australia. The importance of this multibillion-pound expenditure was stressed by UK Defense Minister Grant Shapps, who said that it will provide the UK the long-term hunter-killer submarine capabilities required to preserve strategic advantages in a competitive international order.
This agreement will supposedly bring decades of work to the Barrow-in-Furness shipyard, employing over 10,000 people. This funding will also facilitate investments in the shipyard, supply chain, and create over 5,000 jobs.
Significant UK military companies, including BAE Systems, stand to profit from the AUKUS agreement in more than one way. All of the nuclear reactor plants for the SSN-AUKUS boats will be provided by Rolls-Royce Submarines, which will result in an extension of its Raynesway site in Derby. Additionally, the Ministry of Defence has inked a five-year agreement with Babcock International to work on the SSN-AUKUS design. Babcock International is in charge of maintaining and servicing the UK's submarines.
The AUKUS security alliance has received continuous criticism from China since its initial announcement in September 2021, but the three participating Western nations continue to stress that the pact's main goal is to strengthen stability in the Indo-Pacific area.