Bloomberg News

U.K., France Said to Delay Drone Contract on Spending Review

July 10, 2012

BAE Systems Plc (BA/) and Dassault Aviation SA (AM) are taking longer than they had aimed to secure a contract for an armed, unmanned drone for the U.K. and France as the new French government assesses spending priorities, two people familiar with the negotiations said.

The two countries had aimed to approve the development contract, valued at about 1 billion euros ($1.23 billion) at this week’s Farnborough air show, and those plans have now been canceled, said the people, who asked not to be identified because the negotiations are private.

The Telemos unmanned aircraft program is one of the industrial cornerstones of a 2010 agreement between France and the U.K. on defense cooperation. The medium-altitude, long- endurance drone would replace the U.K.’s Reaper unmanned aircraft fleet around 2020 and France’s Harphang unmanned aircraft, based on the Israel Aerospace Industries Heron.

A BAE spokeswoman said an announcement would occur in the “near term,” while a Dassault spokesman said his company had no comment.

The French government is considering whether to acquire an interim unmanned aircraft to replace the Harphang before Telemos is fielded or whether to try to extend the service life of the current system that has been used in Afghanistan.

New French Defense Minister Jean-Yves Le Drian has said he would take decisions on the country’s unmanned air vehicle plans by July 14, a date the people said may not be met.

To contact the reporter on this story: Robert Wall in London at rwall6@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net


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