BAE Systems and Rolls-Royce to strengthen customer service

Thursday, 22 March 2007

BAE Systems and Rolls-Royce have signed a Memorandum of Understanding (MoU) with the aim of identifying opportunities for alignment and for progressing joint initiatives in order to deliver improved performance to the UK Ministry of Defence (MoD) and other worldwide customers.

Ian King, Chief Operating Officer of UK and Rest of World within BAE Systems, commented: “The MoU builds on an excellent long standing relationship between the two companies and positions us both to work together in a way which reflects the UK’s Defence Industrial Strategy and strengthens our solutions to the benefit of our UK customer and our respective shareholders.”

Martin Fausset, Managing Director of Rolls-Royce Defence Aerospace said: “The innovative nature of this agreement is indicative of the positive progress that the UK MoD and industry have been making in implementing the principles of the Defence Industrial Strategy. We believe that by aligning our resources we can deliver a quantum leap in capability for our customers and better meet their requirements.”

The principles of the MoU can be used to address the requirements of all customers, and in particular will focus on building upon the success achieved in two availability contracts held by BAE Systems and Rolls-Royce supporting the UK’s RB199-powered Tornado fleet.

The joint teams have developed a Tornado Future Support Charter, unifying airframe and engine maintenance policies and forward planning to drive best practice and fleet management improvements for the UK’s Tornado force. Co-location of the teams at RAF Marham (home of the Tornado aircraft) is another important aspect of the Charter, and will lead to further data sharing and open communication.

Notes to Editors

Availability Transformation: Tornado Aircraft Contract (ATTAC)
In December 2006, BAE Systems was awarded a £947 million contract by the UK Ministry of Defence to provide availability support to the whole Tornado platform for the Royal Air Force (RAF).

The contract will provide guaranteed availability of Tornado aircraft for the RAF, is potentially worth in the region of £1.5 billion and will save the MoD £510 million over the initial 10 years of the programme.

Under the ATTAC service, BAE Systems takes responsibility for “depth” support at RAF Marham to maintain the aircraft’s warfighting effectiveness throughout its service life. Overall the company will be responsible for ensuring the required aircraft at an agreed capability are provided to the front line when they are needed.

Rolls-Royce ROCET Contract
In December 2005, Rolls-Royce was awarded an innovative service support contract for the RB199 engine, which powers the MoD's fleet of Tornado aircraft in service with the Royal Air Force.

Under the £185 million agreement, Rolls-Royce has taken responsibility for the full engine support and guarantees an agreed level of availability.

This five-year RB199 Operational Contract for Engine Transformation (ROCET) follows on from a successful pilot scheme, under which Rolls-Royce guaranteed availability on three modules of the RB199 engine.

About BAE Systems:

BAE Systems is a global defence and aerospace company delivering a full range of products and services for air, land and naval forces, as well as advanced electronics, information technology solutions and customer support services. With 88,000 employees worldwide, BAE Systems' sales exceeded £13.7 billion pounds sterling (US25.4 billion dollars) in 2006.

About Rolls-Royce:

Rolls-Royce, a world-leading provider of power systems and services for use on land, at sea and in the air, operates in four global markets - civil aerospace, defence aerospace, marine and energy. Rolls-Royce employs 38,000 people, and annual sales total £7.4 billion, of which 53 per cent are services revenues. The firm and announced order book is £26.1 billion, of which aftermarket services represent 38 per cent, providing visibility of future levels of activity.

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