Leonardo has warned the UK government that it may be forced to shut down its helicopter manufacturing operations in Britain if it fails to secure a flagship £1 billion Ministry of Defence contract, a move that would threaten the future of the country’s last remaining helicopter factory.
In a letter to Defence Secretary John Healey, Roberto Cingolani, chief executive of the Italian defence group, said the contract to replace the long-serving Puma helicopter was central to Leonardo’s long-term commitment to the UK. Without it, the company would need to reassess its entire British presence, including its historic manufacturing base in Yeovil, Somerset, which employs around 3,300 people.
Leonardo’s AW149 helicopter is currently the only contender left for the programme, following the withdrawal of Airbus and Lockheed Martin from the competition last year. The company submitted its final bid in April, with ministers now expected to decide the outcome.
Cingolani warned that any delay or cancellation would carry serious consequences. He said the absence of new UK defence contracts could force Leonardo to reconsider further investment in areas such as electronics and cybersecurity, alongside core helicopter manufacturing.
The Yeovil site, the successor to Westland Helicopters, has been producing military aircraft for decades. It currently builds and supports more than 100 helicopters for the British armed forces, including the Merlin and Wildcat fleets. The facility also handles export orders for customers in the Middle East and North Africa, but executives have said overseas work alone cannot sustain the factory indefinitely.
Speaking to investors last month, Cingolani said Leonardo could not “subsidise Yeovil forever,” noting that the company had gone more than a decade without securing a major new UK helicopter contract. “At some point we should consider why we keep a plant there for 15 years and don’t get anything,” he said.
The Ministry of Defence has sought to downplay concerns, stressing that no final procurement decision has been made. A spokesperson said officials were still assessing the business case for the new medium helicopter programme, and Leonardo’s tender remained under active evaluation. Defence Minister Luke Pollard reiterated in the House of Commons last week that while Leonardo’s bid had been assessed, details on aircraft numbers, delivery schedules, or contract value could not yet be disclosed due to commercial sensitivity.
The warning comes as Prime Minister Sir Keir Starmer has pledged to increase UK defence spending, committing to raise it to 3 per cent of GDP in the next parliament and to 3.5 per cent by 2035 under NATO obligations. For Leonardo, the Puma replacement contract is seen as a test of whether that commitment will translate into sustained investment in Britain’s defence manufacturing base.
Industry experts say the decision could determine the future of sovereign helicopter production in the UK, with the fate of Yeovil hanging on a single contract that could either secure decades of skilled work or mark the end of an era for British aerospace manufacturing.
