The UK Ministry of Defence (MoD) has awarded a £2.4bn contract to BAE Systems for the supply of munitions.
The ‘Next Generation Munitions Solution’ (NGMS) contract is expected to sustain around 4,000 jobs across the country.
The new agreement will supersede the existing Munitions Acquisition, the Supply Solution (MASS) contract, which will be completed at the end of 2022.
It will ensure the delivery of munitions products and engineering support to the armed forces of the country and will commence in January 2023.
BAE Systems chief executive Charles Woodburn said: “This contract secures the future of a highly technical and critical industry which supports thousands of manufacturing jobs in several areas throughout the UK.
“By investing in new technology and skills to further develop our expertise, we can continue to deliver essential sovereign capability to the Armed Forces at competitive prices.”
Around 1,260 people are employed by BAE Systems, ranging from munitions manufacturing testing to evaluation at five of its sites across the UK.
Additional 1,500 jobs will be sustained in the UK supply chain with the contract, and an additional 1,300 positions.
With this agreement, BAE Systems will invest £70m for the refurbishment and upgrade of manufacturing lines. Around 75% of the value will be invested by 2026.
The company has also planned to spend around £350m for raw materials and machine components from companies based in the UK.
UK Defence Minister Jeremy Quin said: “This vital multi-billion-pound contract will provide our service men and women with firepower on the front line for years to come whilst investing in British industry, British jobs and British infrastructure.
“Defence underpins hundreds of thousands of jobs across all four corners of the nation, and ongoing investment is crucial as we work together to build back better and stronger from the Covid-19 pandemic.”