DLO Press Release

20 June 2005

MOD Awards multi-million VC 10 contract to BAE Systems

A contract worth up to £38 million has been awarded to BAE Systems to maintain the Royal Air Forceís fleet of VC10s and improve availability of aircraft to the Front Line.

The role of the VC10 fleet is to provide the RAF with an in-flight air refuelling capability and a cargo and passenger carrying service. The RAF brought its first VC10s into service in 1966 and is the only operator of VC10 aircraft in the world. The current fleet of 19 aircraft operates out of RAF Brize Norton, Oxfordshire.

Todayís contract will extend the support contract the Ministry of Defence signed with BAE Systems in 2003. Known as 'JAVELIN AMBER' it will guarantee availability of the VC 10 fleet to the Royal Air Force until the beginning of the next decade.

Under the original £207 million JAVELIN contract, BAE Systems provided guaranteed levels of VC10 availability through spares-inclusive maintenance. As prime contractor, BAE Systems executed simultaneous sub-contracts with the Defence Aviation Repair Agency (DARA) to carry-out depth maintenance and ensure that an agreed level of airframe components were available to support the RAF's first and second-line maintenance of the VC10 fleet at the DARA in St Athan, South Wales. The contract includes the provision of engineering support and an agreed level of airframe components to support first and second line maintenance at RAF Brize Norton. This contract has delivered cost savings of 20 per cent.

Group Captain Graham Evans, Leader of the DLO's Air Refuelling & Communications Fleets Integrated Project Team, said:

'This contract incentivises BAE Systems to deliver availability of a key asset to the front line and will build upon the cost savings already achieved. It represents value for money to both the MOD and the tax-payer, whilst providing BAE Systems and its subcontractor DARA with an increased long-term order book.'

The new agreement will transfer VC10 second line maintenance from RAF Brize Norton to DARA's Fixed Wing business at St Athan, supported by service level agreements for supply and engineering support for on-aircraft maintenance. Performance is incentivised based upon aircraft availability. BAE Systems will take on additional responsibility for fleet management and providing VC10 maintenance policy advice in order to maximise efficiencies.

Notes to Editors

The JAVELIN AMBER contract which follows the DLO's Transformation Policy, will deliver cost reductions of almost 12% against current funding and is in line with the MODís End-to-End Study output savings targets and increase the availability of the VC10 fleet to the front line for operational duties. The JAVELIN contract supports the aircraft through to its out of service date and has an incentivisation mechanism that balances performance with gainshare arrangements, flowed down to all suppliers. It is these improved processes that have contributed to the overall savings and which are an indication of the partnering behaviours now embedded within all organisations.

For further information please contact: Bob Bates, DLO Secretariat (Strike) Tel: 01480 52451 x7801 Mobile: 0779 099 7285 Email: drm-commoff2@esair.dlo.mod.uk

Last Updated: 20 Jun 05