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You are here: Home > Marine > Marine news > 2005 > Rolls-Royce wins £137 million support contract for four navies
Rolls-Royce has won a £137 million long-term service and support contract for gas turbines which power 27 ships in service with the Royal Navy, and French, Belgian and Royal Netherlands navies.
The company will support Olympus and Tyne gas turbines for the next 12 years, when the ships are due to go out of service. The contract was awarded by the UK Ministry of Defence on behalf of all four navies.
The TotalCare package will see Rolls-Royce take responsibility for ensuring power being available to keep ships at sea, rather than entering into individual service and overhaul contracts for each gas turbine.
Lord Bach, Minister for Defence Procurement, said: “I am very pleased that this new Contractor Logistics Support contract has been agreed. These arrangements will provide long-term benefits to both industry and MoD. Industry will be better able to plan for the long term rather than piecemeal. MoD benefits by making the best use of industry's expertise in the support of complex equipment with far less bureaucracy, saving money that can be better used to provide improved support elsewhere.”
Saul Lanyado, Rolls-Royce President - Marine, said: “This long-term support contract will give all four navies guaranteed levels of service. It enables them to plan their budgets better, and reduce overall cost.”
The deal covers:
Three Royal Navy carriers HMS Ark Royal, HMS Illustrious and HMS Invincible, each powered by four Olympus gas turbines.
Nine Royal Navy Type 42 destroyers (two Olympus and two Tyne each).
Four Type 22 frigates (two Tyne and two Spey each, the Spey being covered by a separate agreement).
Seven French Navy Georges Leygues-class destroyers (two Olympus each).
Three Belgian Navy Wielingen-class frigates (one Olympus each).
One Royal Netherlands L-class frigate (two Olympus and two Tyne).
In December, Rolls-Royce signed a 20-year contract with the Chilean Navy to provide repair services and technical support for five of its ships, powered by Olympus, Tyne and Spey gas turbines.
Rolls-Royce already has long-term support contracts with the UK MoD which cover propulsion support for nuclear submarines, and the operation of the Vulcan naval reactor test establishment at Dounreay, Scotland.
Work on an Olympus gas turbine at the Rolls-Royce repair and overhaul facility in Ansty. The company is supporting Olympus and Tyne gas turbines for the next 12 years for the Royal Navy, French, Belgian and Royal Netherlands navies.
Work on a Tyne gas turbine at the Rolls-Royce repair and overhaul facility in Ansty.
Rolls-Royce operates in four global markets - civil aerospace, defence aerospace, marine and energy. It is investing in technology and capability that can be exploited in each of these sectors to create a competitive range of products.
The success of these products is demonstrated by the company's rapid and substantial gains in market share over recent years. The company now has a total of 54,000 gas turbines in service worldwide. The investments in product, capability and infrastructure to gain this market position create high barriers to entry.
Rolls-Royce has a broad customer base comprising more than 500 airlines, 4,000 corporate and utility aircraft and helicopter operators, 160 armed forces and more than 2,000 marine customers, including 70 navies. The company has energy customers in nearly 120 countries. Rolls-Royce employs around 35,000 people, of which 21,000 are in the UK. Forty per cent of its employees are based outside the UK - including 5,000 in the rest of Europe and 8,000 in North America.
The large installed base of engines generates demand for the provision of services. A key element of the company's strategy is to maximize services revenues, which have increased by 60 per cent over the past five years, by the provision of a comprehensive portfolio of services.
Annual sales total nearly £6 billion, of which 55 per cent are services revenues. The order book is more than £21 billion, which, together with demand for services, provides visibility as to future activity levels
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Craig Taylor
Senior Business Partner – Corporate Communications
