|Carriers 'face delay' if French brought in
By Russell Hotten, Industry Editor
Last Updated: 1:02am BST 29/05/2007
Carriers 'face delay' if French brought in
Lord Drayson: work-sharing construction 'makes sense'
The delivery of the Royal Navy's new £3.9bn aircraft carriers could be delayed after defence companies warned they did not want to work with the French.
The pair - British firms BAE Systems and VT - are understood to be dismayed by news that the Ministry of Defence believes UK and French shipyards might manufacture substantial numbers of common components for carriers for both the Royal and the French navies in order to bring down the cost of the ships.
But the deal is dependent on the MoD and the defence firms agreeing the terms on which to order two aircraft carriers. The Aircraft Carrier Alliance, which includes BAE, VT, Bab and Thales UK, had originally expected to sign a contract imminently.
The joint project also threatens to jeopardise a restructuring of the British shipbuilding industry which is being spearheaded by BAE.
"You can kiss goodbye to the carriers being delivered on time if the French are involved," said one source. "And I can see BAE and VT ripping up their joint venture deal, or at the very least renegotiating the terms."
The revelation of the Anglo-French rift is likely to harm industrial relations between the two countries and could potentially be a point of discussion between British Prime Minister Tony Blair and recently elected French President Nicolas Sarkozy at next week's G8 summit in the -Baltic town of Heiligendamm, -Germany.
The problem has arisen because, in spite of industry being aware that the French were building a carrier, it was thought that they were doing so alone, other than buying the UK's design blueprint for £100m and limited joint purchasing of parts.
But 10 days ago Lord Drayson told The Daily Telegraph that work-sharing on construction "made sense" if it reduced the £3.9bn cost of the UK's two carriers. "This is the intelligent way to do this."
He said no final decisions had been made, but that it was possible that UK and French shipyards could, for example, build large sections used for the hulls of both countries' vessels.
The news came as a bombshell for industry, which had expected to sign off on the carrier contract before Easter. News of Lord Drayson's French talks would explain why the deal has been delayed.
One critic of co-operation said: "There are issues around the capacity of shipyards to co-operate, and about putting more companies into the mix to complicate decision-making. I just cannot understand it."
The MoD said last week that Lord Drayson would only sanction any joint production with the French if it made sense for UK shipbuilding and did not delay delivery of the Navy's carriers, due in 2012 and 2015.
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