BAE Systems has reinforced its commitment to growing Australia’s defence industry capability through the creation of a supply chain agreement with the Federal Government.
New BAE Systems Australia Chief Executive David Allott and Minister for Defence Materiel Jason Clare signed the agreement on Tuesday in Canberra during their first meeting.
The agreement formalises the company’s longstanding efforts to work with the Defence Materiel Organisation (DMO) to create opportunities for more Australian companies, especially Small and Medium Enterprises (SMEs), to compete for work within BAE Systems global supply chain.
It follows the recent success of Victorian precision engineering company Marand in securing a long-term deal with BAE Systems valued at nearly $800 million to supply vertical tails for the global F-35 Joint Strike Fighter manufacturing program.
Mr Allott said the company’s Australian supply chain included over 2600 businesses, 88 per cent of which are based locally.
“In 2010, we spent more than $900 million purchasing goods and services from these
companies.
Our agreement with Marand is a great example – this is the largest, highest-value package of industrial work on the F-35 program yet awarded in Australia.
“Beyond the JSF manufacturing program, other examples of where we have already brought local suppliers into our global supply chain can be found in our Unmanned Autonomous Vehicle (UAV) capability and our support contract for the Hawk Lead-In Fighter.”
He emphasised: “We believe this is the right thing to do as part of our strong support for creating a vibrant, long term defence industry in Australia.
“Under this agreement, we are creating a specialised team within BAE Systems Australia that will not only identify business opportunities but also support development and continuous improvement activities with SMEs, provide advice around regulatory issues and act as a single point of contact into our global supply chain.”
Seven multi-national Defence companies have now signed Global Supply Chain deeds with the Australian Government – Boeing, Raytheon, Thales, Eurocopter, Lockheed Martin, Northrop Grumman and BAE Systems.
The next step is to sign Annexes to these agreements which give companies access to government funding to hire a team of people to identify and certify Australian companies as part of their global supply chains.
Boeing, Raytheon and Thales currently have these annexes in place.
The Government has invested over $11 million in the program over the past three years.