LONDON (Reuters) - Britain's BAE Systems (LON:BAES) has won a further 130 million pound ($162 million) order from the government for munitions, as the Ukraine war continues to boost the UK defence industry.
Britain had already signed a 280 million pound munitions contract with BAE, Britain's biggest defence company, in July before it exercised an option to increase its supply by another 130 million pounds on Tuesday.
"The conflict in Ukraine has forced a global rethink around munition priorities," Steve Cardew, BAE's business development director, munitions, told media at the DSEI arms fair in London.
The chief executive of British military technology company Qinetiq, Steve Wadey, said the war in Ukraine had triggered its main customers of Britain, the United States and Australia to "strategically step back and look at the long-term threats in the world and consider their defence and security policies, budgets and solutions."
That means growing interest and support for technologies Qinetiq is working on such as laser-directed energy, which uses lasers to shoot threats out of the sky, and for BAE, it means adding new facilities.
BAE is building a new machining line and explosive filling facility to meet Britain's munitions needs for 155mm artillery shells, 30mm medium calibre rounds and 5.56mm ammunition.
Cardew said he expected orders from NATO allies to follow. "We are in active dialogue with a number of our NATO customers today," he said.
The urgency to replenish stockpiles depleted by the weapons Britain is sending to Ukraine is driving innovation in energetics and propellants, and a shift to using off-the shelf steel instead of bespoke steel to speed up production.
"If we rely on old technology to do that we're probably looking at five or six year programme ... we just don't have the time to do that," Cardew said.
($1 = 0.8014 pounds)