'Minimise White House blowback': Burnham under pressure as Airbus satellite contract decision looms
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The News and Portsmouth City Council have written an open letter to the Prime Minister - calling on him to award Skynet 6 to Airbus
Pressure is mounting on the prime minster to support Portsmouth by accepting a multi-billion pound satellite contract bid - despite him facing pushback from the US.
The Financial Times reports that the government will get criticised regardless of who is awarded the SkyNet 6 WSS space satellite contract. Any Burnham has two bids to consider; one from one of the largest employers in the city, Airbus, and another from the US-based defence giant Lockheed Martin.
Both firms are aiming to build the next generation of satellites for the armed forces as part of a deal worth £2.4bn. Upgrades will be made throughout the defence network, with two geostationary satellites that will provide secure communications into the 2040s and beyond.
Sources told The Financial Times that final offers submitted in 2025 are set to expire in mid-November, with a decision due in the next few weeks. Douglas Barrie, senior fellow at the International Institute for Strategic Studies think-tank, said the government will feel the ramifications regardless of which bid is preferred.
He said: “Go with the US and your defence industrial policy looks like it’s getting off on the wrong foot. Go with the incumbent Airbus, and you need to minimise any blowback from the White House.”
Details on both bids
The decision to award the contract has been delayed for several months. Funds totalling £50m has been set aside to extend the lifespan of the Skynet 5 military communication satellites.
Skyet 6A is the replacement, and is due to launch in 2027. It will be used to carry the Ministry of Defence’s most sensitive data.
Airbus currently produces satellites in Portsmouth and Stevenage, with a large amount of investment being ploughed into the company’s facility in Anchorage Park. With the Lockheed Martin bid, parts will be produced and manufactured in the US.
Promises have been made to create roughly 500 direct jobs in the north-east of England - via an assembly facility in Durham - alongside another 1,500 jobs in the supply chain, though this could take years to facilitate. Airbus currently supports around 3,000 jobs in Portsmouth, and Stevenage in Hertfordshire, with 650 employees working on Skynet.
Reaction
Chancellor John Healey, a former defence secretary, has made assurances that the government will be buying from British companies wherever possible. He reiterated this priority during the recent Labour Party conference.
Mr Burnham previously made calls to “reindustrialise” Portsmouth’s defence sector during a visit to the city’s naval base. He added that he wants to put power into communities and businesses on the south coast of England.
Portsmouth North MP Amanda Martin, and Stevenage MP Kevin Bonavia, have written to the prime minister backing the Airbus proposal. The News and Portsmouth City Council have also sent a joint letter to the prime minister urging him to not let 70 years of UK design authority and sovereign satellite capability to walk out of the city.
Ms Martin said: “This contract decision is incredibly important for Portsmouth and the future of sovereign space capability in the UK. Across Portsmouth and Stevenage, Airbus already have the skills, expertise and capacity to deliver the Skynet programme. It would take years to replicate these jobs elsewhere in the country.
“The new Chancellor, John Healey, has rightly put buying British at the heart of his economic strategy. The Skynet programme provides a perfect opportunity to put this into practice.
“I have been urging the Government to award Airbus this contract both in writing and behind the scenes. This is about securing British jobs and strengthening our national industrial base. I eagerly await the decision."
Unite union general secretary Sharon Graham previously warned that hundreds of jobs are at risk if Airbus loses the contract. “Andy Burnham has said he is backing Britain and British jobs. The Skynet WSS contract could be the first test of this,” she added.
“These satellites have been designed and built in Britain for the last 20 years ensuring hundreds of skilled jobs in Stevenage and Portsmouth, as well as thousands more in the supply chain. Handing the British Space industry over to the Americans in the first days of the new government would be a massive mistake, industrially and politically.”