(Bloomberg) -- The UK, Japan and Italy formalized their planned venture to build a new generation fighter jet that the countries expect to deliver in a decade.
BAE Systems Plc, Leonardo SpA and Japan Aircraft Industrial Enhancement Co. will each own a 33.3% stake in the new company that will develop and manufacture jets under the Global Combat Air Program (GCAP), the companies said in a statement Friday. The company will be based in the UK and the first chief executive officer will be from Italy, according to the statement.
Britain and Italy first agreed to develop a so-called sixth-generation fighter jet, dubbed Tempest, in 2018 with Japan agreeing to merge its own jet program in 2022. Aircraft developed under the GCAP are scheduled to be in service in 2035 and will replace the Eurofighter Typhoon jets in the Royal Air Force’s fleet.
Manufacturing and final assembly of the aircraft will be subcontracted to BAE, Leonardo, Mitsubishi Heavy Industries and the wider supply chain, the companies said. The new combat aircraft will feature next-generation capabilities such as an interactive cockpit, an advanced weapons system, integrated sensors and a powerful radar, according to BAE’s website.
The GCAP will compete with Europe’s Future Combat Air System, a program that is led by Airbus SE, Dassault Aviation SA and Spain’s Indra Sistemas SA.
It’s too early to say how much GCAP is projected to cost as the companies are still analyzing the requirements needed, Herman Claesen, managing director of the Future Combat Air Systems business at BAE Systems, said on a call on Friday. Leonardo’s CEO Roberto Cingolani had in July said that the program is set to require about €40 billion ($41.9 billion) to get started, citing government estimates.
Separately, Saudi Arabia may join GCAP as a partner, with the UK, Italy and Japan closing in on an agreement to allow the country to be a part of the consortium, people familiar with the matter said. Momentum has built toward including the Saudis in recent months — with help funding the project being offered in exchange for procurement priority an option — though discussions are still ongoing, they said.
The overture was telegraphed last month by Italy’s Foreign Minister Antonio Tajani who said that GCAP would likely expand to Saudi Arabia. He declined to provide a timeline but said all parties “were working” toward the same objective.
“The door is open to other partners to join and that includes Saudi Arabia,” Claesen said. “There are a lot of nations across the globe who are increasingly interested.”
--With assistance from Alberto Nardelli, Ellen Milligan, Nicholas Takahashi and Donato Paolo Mancini.
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