The British Ministry of Defense has given BAE Systems (OTCMKTS:BAESY) a £201 million contract to start work on the design of its Successor-class submarines, as well as to start developing the manufacturing processes required to build the submarine. Design work includes the arrangement of systems and machinery within the vessel as well as early prototypes. This will conclude the assessment phase of the project with the next phase scheduled to begin later this year.
Tony Johns, Managing Director of BAE Systems Submarines, said, "We are incredibly proud of the role we play in designing and building our nation’s submarines. The Successor programme is one of the most challenging engineering projects in the world today and this additional funding will enable us to further mature the design." This will be the fourth contract given to the firm with the first two awarded in 2012.
Currently, BAE is spending around £300 million to develop new production facilities and revamp old ones. It is also spending an additional £300 million in order to improve its supply chain for the project, with an increase in investments expected as the program matures. Construction on the boats was supposed to begin this year, but so far no contract has been signed yet.
The Successor-class is a ballistic-missile submarine, designed to carry Britain’s nuclear deterrent of Trident missiles. Four submarines will be built and expected to enter service sometime in the 2030s, with Rolls-Royce responsible for the submarines nuclear power plant. Total project costs have so far been estimated at £31 billion, a rise from previous forecasts of £25 million. Besides working on the Successor-class, BAE is also working on the Astute-class attack submarines, which are also nuclear-powered.