It's a battlefield

In all wars there are winners and losers.

Unfortunately, for Leicestershire the losers of the battle to win a multi-million pound contract to make light tanks for the British Army are 260 highly-skilled workers in Braunstone Frith.

BAE Systems today announced the closure of its Scudamore Road factory, while at the same time the Ministry of Defence (MoD) said US rival General Dynamics (GD) had won the £500 million deal to build the armoured vehicle.

The MoD named GD as its preferred supplier for the programme in March. It's likely BAE had been working hard behind the scenes to try and persuade the new coalition Government its plans were better than GD's. The firm, after all, spent five years and £50 million developing the Future Rapid Effect System (FRES) vehicle.

This programme had originally been worth £4 billion, but has now been broken up and may be reduced in size again as part of the defence spending review.

But the new regime was not prepared to change a decision made by the Labour Government. This, together with new Government's decision to the delay the upgrade of 450 Warrior armoured troop carriers until the spending review has been completed, resulted in today's announcement.

Meanwhile, defence minister Peter Luff announced the £500 million contract signed with GD had safeguard hundreds of jobs in south Wales and would create 200 new posts over the next few years.

It is likely some of these jobs will be filled by workers from the BAE site in Leicester.

All this comes in the same week as Hinckley sock maker HJ Hall lost out on a MoD contract to supply British armed forces to a firm in Northern Ireland which makes its socks in China.

A miserable few days on the business battlefield for Leicestershire firms.