British Aerospace Company Aeralis Enters Administration

A British aerospace company developing a proposed replacement for the Hawk jets flown by the RAF's Red Arrows has gone into administration, resulting in the loss of about 30 jobs. Aeralis had positioned itself as the only British firm able to supply a new advanced jet trainer designed and built in the UK.

The firm was seeking a contract to replace the Hawk jets before their planned retirement in 2030. Administrators said the company had faced a sustained period of pressure on its cashflow after continued delays to the UK Defence Investment Plan combined with geopolitical factors affecting sources of funding.

The company's main investor, Barzan Holdings, withdrew its funding amid the US-Israeli war with Iran. A potential agreement to make jets for the French government also failed to materialise. The company filed for administration on Friday.

Defence spokesperson said the fast jet trainer programme is ongoing and no final procurement decisions have been made. The spokesperson added that since July 2024 the government has signed 1,200 major contracts with 93 percent of the spend going to UK-based companies.

Last year the UK government's Strategic Defence Review recommended the Hawks should be replaced by a cost-effective advanced trainer jet. The review suggested that procurement should prioritise British businesses to benefit the UK economy.

Aircraft offered by BAE Systems, Leonardo and several other companies are also considered to be contenders. BAE Systems is working with Boeing and Saab to develop the T-7 jet into a replacement for the Hawk and has committed to assembling the aircraft in the UK.

A BAE Systems spokesperson said their joint approach brings together three leading global defence primes at the heart of UK combat air capability, offering the UK a next-generation, cost-effective, capable and reliable solution. Leonardo told the BBC its M-346 jet was being assessed as an option for a number of emerging requirements and that it would work with UK industrial partners to provide a UK low risk solution.

Aeralis chairman Robin Southwell said the decision to go into administration had been taken after careful consideration of the company's position and the funding challenges it has faced over recent months. In an interview prior to administration, Southwell told the BBC the delay in the investment plan was making life very difficult for companies such as ours and others.

The company estimates that its programme could have created 4,000 new jobs in the UK and generate £600m in annual exports. The aircraft has only been designed digitally at this stage and required government backing to start production. The company filed for administration on Friday.