BAE’s Next Generation Munitions Solution agreement provides much-needed reassurance to UK defense, says GlobalData

Following the news that BAE Systems has received a £2.4bn munitions contract, the Next Generation Munitions Solution (NGMS);

Harry Boneham, Associate Analyst at GlobalData, a leading data and analytics company, offers his view on the situation:

“News that BAE Systems has secured this award comes as little surprise, with the company being the prime contractor of the Munitions Acquisition Supply Solution (MASS), the previous iteration of the UK munitions supply agreement. However, the decision is a vital one to help reassure the UK domestic defence industry amid COVID-19. Investment in new manufacturing technology such as this, where BAE is planning to invest £70m on refurbishing and upgrading manufacturing lines, is vital for the UK defense industry to remain competitive globally.

“GlobalData values the total UK military ammunition market in 2023 at £375.8m, when NGMS is scheduled to begin. This will rise by 36% in the first five years, to £511m in 2028. These valuations notably account for rocket procurement, which was included under MASS but is not under NGMS. This indicates that there is room for further ammunition contracts.

“However, this accounts for a reduced proportion of the Ministry of Defence’s total General Munitions (GM) portfolio from its previous iteration, decreasing from 80% to 50%. This decrease grants the MoD manoeuvrability as technology advances, at a time when an emphasis has been placed on the modernization of UK Armed Forces.”

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