BAE signs Wedgetail agreement with Boeing

BAE Systems Australia Ltd has reached an agreement with Boeing over its role as a sub-contractor in the RAAF's $2.2 billion Wedgetail airborne early warning & control project, for which Boeing is prime contractor.

Under the agreement BAE Systems Australia will be responsible for developing, supplying and supporting the electronic warfare surveillance and self-protection suite for the Wedgetail AEW&C aircraft, as well as the operational mission simulator for the radar and sensor operators, the mission support system and the AEW&C support facility at RAAF Base Williamtown, where the Wedgetail aircraft will be based.

BAE Systems Australia expects to sign the $400 million sub-contract in the near future, Jim McDowell, the company's CEO, told ADM.

"This is a significant and demanding project for BAE Systems. The agreement reinforces BAE Systems' position as a leading supplier of electronic warfare and recognises our skills in the areas of integrated software systems," he said.

Boeing signed the Wedgetail prime contract in December last year. The first two aircraft are expected to be delivered in 2006. The Boeing-led team, which includes Northrop Grumman's Electronic Sensors and Systems Sector, Boeing Australia Limited and BAE Systems Australia, will deliver four Boeing 737-based Wedgetail AEW&C aircraft; the RAAF has options for up to three additional aircraft.

However, Boeing's contract will see the company and its sub-contractors deliver six shipsets of radars and mission systems, McDowell told ADN. The two spare sets will be used for ground training, and could be installed in an aircraft if the RAAF exercises its option to buy more.

"This agreement is important to the future consolidation and growth of BAE Systems Australia," said Alan Wakeham, Managing Director of BAE Systems Australia's Adelaide-based Defence Systems Division. "It provides an important opportunity for our company to strengthen and develop its capabilities and support the Australian Defence Force. The project will provide high value-added work for years to come." The company expects Wedgetail to sustain about 100 jobs over the next six years; through life support and possible export sales of EW and support equipment to other Wedgetail customers could see the value of BAE Systems Australia's Wedgetail business increase significantly, he said.

However, according to BAE Systems and Boeing sources it is too early to say whether or not the EW suite, operational mission simulator and other support infrastructure developed by BAE Systems Australia could be adopted by other export customers for the Wedgetail AEW&C system. These are likely to be targeted for local industry involvement initiatives by at least some of Boeing's export customers.

By Gregor Ferguson, Adelaide