‘The Middle East is a Very Important Region for BAE Systems’

The Middle East is a very important region for BAE Systems and the company continues to pursue a number of export opportunities for Typhoon in the region as well as in Europe to support continuity of combat aircraft production through to Tempest, says Gabby Costigan, Group Managing Director - Business Development at BAE Systems.

In an interview, Costigan speaks on a range of issues, including the company’s growing footprint in Doha and the Middle East, the company’s capabilities in the maritime domain, the impact of the war on Ukraine in the defence sector, and technology transfer.

Could you talk a bit about the company's footprint in Qatar and the local partnerships that you have? Do you hire a lot of local talent?

Qatar is an exciting place to be and we're absolutely focused on supporting Qatar and its people in its ambitions for a prosperous and sustainable future, as outlined in its National Vision 2030. Partnership and collaboration are at the core of what we do in Qatar and we work with local companies to deliver sophisticated defence solutions across a number of domains for the Qatar Armed Forces. Most prominent in this is delivering on our commitments to our customer through our Typhoon and Hawk contracts, which also includes training solutions for the Qatari Emiri Air Force (QEAF). We have around 50 people based in Qatar supporting this and our activities across other domains.

We're a true believer of strength through partnership and this is demonstrated through BSL, a joint venture company between ourselves and Qatari partner Strategic Aerospace Services, which is 51% Qatari-owned. It now employs around 400 people in Qatar delivering a wide range of services, including support of the QEAF Typhoon fleet and the Qatar Technical Institute, which delivers vital skills to Qatar's military personnel of the future.

Is the company pursuing new opportunities for sales of the Eurofighter Typhoon as well as the Hawk in the region?

Typhoon is truly at the heart of combat air defence across the Gulf with Qatar, the Kingdom of Saudi Arabia and Kuwait operating it at the centre of the fast jet fleets. It will continue to operate with these nations and others across the globe in to the 2060s and beyond. With regards to Typhoon future sales, we continue to pursue a number of export opportunities for Typhoon in Europe and the Middle East to support continuity of combat aircraft production through to Tempest.

We are also proud of our achievements on Hawk, with it being our longest serving product with 650 aircraft in operating at the heart of the training pipeline including across the Middle East, including the QEAF. Through its Hawk and Typhoon squadrons, Qatar enjoys a strong partnership with the UK's Royal Air Force with joint squadrons operating both aircraft, underlining the deep relationship between the two nations. Hawk has prepared more than 25,000 pilots with the skills they need for life in a fast jet cockpit, and we continue to work alongside our global operator base to evolve its capabilities ensuring it has the capability to continue to train thousands more pilots for many years to come.

What are some of the capabilities in the maritime domain that you are promoting at the Show?

Across our global enterprise, we have extensive capabilities in design, manufacture, support and upgrade of complex surface ships, submarines and combat systems. With DIMDEX being such a significant exhibition for those interested in maritime and defence technologies, we're looking forward to showcasing some of our capabilities during the event. This includes our integrated warship and naval base support services, where we can highlight our proven capabilities in naval base management, asset management and ship maintenance to maximise warship availability. We're also pleased to feature Nautomate, which is a high specification fully autonomous military control system that can be retrofitted to existing surface and sub-surface maritime platforms or designed in for new platforms.

What is your view on technology transfer? Do you see it as an essential element in all major defence partnerships?

When developing local partnerships, our main aim is to support economic development and this can absolutely be achieved through the transfer of knowledge, skills and technology. We have strong experience supporting the industrial ambitions of many countries around the world, particularly in the Middle East through the establishment of joint ventures, local partner companies and programmes. In Qatar specifically, there has been significant investments in the development of its own indigenous research and development capabilities and we're also interested in learning from Qatar and identifying mutually beneficial areas of research and development that will benefit both Qatar, the UK and BAE Systems. The collaboration between government, industry and academia is vital in achieving this and we see this as a valuable way to deepen our relationship with Qatar.

How important is the Middle East for BAE Systems? How much has your presence in the region grown over the last decade?

We've had a presence in the Middle East for more than 50 years and consider it a very important region for our company. We now have around 7,000 people across the region in a number of roles supporting customers in leading air, cyber, maritime and electronic systems capabilities. Our presence in Qatar and role on Hawk and Typhoon has been a significant contribution to our growth in the past decade, with more than around 50 now based in country which we are growing through our BSL joint venture.

Do you think that the company's presence across all domains gives it an edge over its competitors in the region as well as globally?

One of our differentiators is our breadth and depth of capability across our global ecosystem. We operate in many markets where we design, develop, deliver and integrate world-leading products and services, from deep sea to deep space. We have access to the region and around the world. That's a powerful differentiator as we can help identify what's available and how we can work with local partners to offer a value for money solution that can also develop sustainable capabilities in-country.

How much of an impact has the ongoing conflict in Ukraine had on the global defence industry? Do you see any trend that will impact production and future sales?

Recent global events have demonstrated the need for strong defence and security with governments around the world continuing to prioritise defence spending. We've seen the acceleration of some orders, for CV90s for example, a renewed interest in capabilities like M777 howitzers and we are also starting to see orders for re-stocking of ammunition starting to come through. The war in Ukraine has also highlighted the importance of a number of key technologies, including in autonomy, space, synthetic training and digital, and these are areas that we're continuing to invest in through our self-funded R&D. We're proud to work with our government customers to provide training, support and repairs for the wide range of equipment in use in Ukraine that was originally built by us. We look forward to further strengthening our relationship with the Ukrainian government and local industry to understand future requirements that will help ensure Ukraine can eventually rely on a vibrant defence manufacturing capability of its own.

Do you see an improvement in supply chain issues that the industry has faced in recent years? What is BAE Systems doing to tackle the situation?

As a global organisation, we believe in strong and resilient supplier relationships. We spend more than £10bn with c20,000 directly contracted suppliers around the world each year and they play a critical role in helping us to deliver equipment and services to our customers. We're working with partners and suppliers on Group-wide supplier agreements to smooth price fluctuations and conduct regular reviews and enhanced risk assessments, so we have good visibility of any potential issues.