The Ministry of Defence and Defence Secretary Wes Streeting have awarded a £708 million contract extension to accelerate advanced air combat technology for the UK Armed Forces, supporting work for more than 4,500 people across Britain.
The investment was announced on 22 July 2026 during the Farnborough International Airshow. It extends an existing programme led by BAE Systems and involving Leonardo UK, MBDA UK and Rolls-Royce.
Around 600 British-based companies and academic institutions form the programme’s nationwide supply chain. Approximately 90% of the associated jobs are located outside London and the south-east.
Government Awards £708 Million Contract Extension
The contract will continue the development of technologies required for the UK’s Future Combat Air System. The programme is intended to provide future capability for the Royal Air Force and the wider UK Armed Forces.
BAE Systems will lead the next phase alongside the other Team Tempest partners. The extension follows earlier government investment in engineering facilities, physical infrastructure and technology development.
- Contract value: The programme extension is worth £708 million.
- Workforce: More than 4,500 people will support development across the UK.
- Supply chain: Around 600 companies and academic institutions are involved.
Contract and Programme Scope
| Indicator | Programme Detail | Context |
|---|---|---|
| Contract | £708 million | Ministry of Defence extension |
| Lead company | BAE Systems | Works with Team Tempest partners |
| Announcement | 22 July 2026 | Farnborough International Airshow |
Advanced Technologies Support Future Air Capability
The programme will develop artificial intelligence, advanced software and digital engineering systems for future combat aircraft. It will also support manufacturing methods involving augmented reality, additive manufacturing and robotics.
The Ministry of Defence said some of the capabilities could have applications beyond military aviation. The work includes digital engineering methods designed to support the development and testing of complex systems.
- Digital engineering: Computer-based development will support the design and assessment of future systems.
- Advanced manufacturing: Additive manufacturing and robotics will be used during development.
- Artificial intelligence: AI and advanced software will form part of the technology programme.
Investment Supports Thousands of UK Jobs
More than 4,500 workers will contribute to the programme through the main contractors and wider supply chain. The work includes engineering, software, manufacturing and specialist technical roles.
The geographical distribution supports industrial activity across several UK regions, with the Ministry of Defence stating that around 90% of programme jobs are outside London and the south-east.
UK Employment and Supply Chain
| Indicator | Scale | Context |
|---|---|---|
| Workers | More than 4,500 | Employed across the programme |
| Organisations | Around 600 | Companies and academic institutions |
| Regional jobs | Approximately 90% | Outside London and the south-east |
Team Tempest Partners Lead Development Work
BAE Systems will oversee delivery with Leonardo UK, MBDA UK and Rolls-Royce. The companies form the industrial partnership responsible for developing the UK’s future combat air technologies.
The previous investment phase expanded digital engineering capacity and supported the construction of specialist infrastructure. It also advanced technologies expected to contribute to future aircraft, weapons, sensors, propulsion systems and supporting software.
The latest contract allows the partners to continue that development while maintaining specialist skills and industrial capacity. Academic institutions and smaller suppliers will also contribute through the wider programme network.
Wider Defence Investment Backs Programme
Part of the work will provide the UK’s contribution to the Global Combat Air Programme, an international project focused on next-generation combat aircraft. The technologies will also support the UK’s broader Future Combat Air System.
The government’s Defence Investment Plan confirmed that £8.6 billion would be allocated to the Global Combat Air Programme over the following four years. The Ministry of Defence said more than £5 billion had been invested across the UK Future Combat Air System programme since 2018.
The new contract forms part of that wider long-term investment programme. It covers the continuation of domestic research, engineering and manufacturing activity required for the UK’s participation in future combat air development.
Stakeholder Comments
Wes Streeting, Defence Secretary, said:
“This is a clear vote of confidence in British industry, and the thousands of highly skilled workers who are helping to keep our country safe.”
“This investment in advanced combat air technology for the UK Armed Forces will strengthen our defence and deterrence and shows our clear commitment to backing British workers with our defence investment, creating jobs and supporting communities across the UK.”
Simon Barnes, BAE Systems Group Managing Director, said:
“The Future Combat Air System programme represents the UK’s ambition to shape the future of combat air and secure a leading role in the technologies, skills and capabilities that will define air power for decades to come.”
“This additional investment will enable us, as Team Tempest partners, to continue pushing the boundaries of digital engineering, advanced systems and next-generation combat air technologies, helping sustain the UK’s position at the forefront of combat air innovation.”
The £708 million contract extends the UK’s future combat air development programme through BAE Systems and the Team Tempest partnership. It will support thousands of workers, hundreds of suppliers and continued work on artificial intelligence, software, engineering and manufacturing systems. The programme will contribute to future Royal Air Force capability while supporting the UK’s role in the Global Combat Air Programme.
Sources: Ministry of Defence.
Prepared by Ivan Alexander Golden, Founder of THX News, an independent news organisation delivering timely insights from global official sources. Combines AI-analysed research with human-edited accuracy and context.
