BAE Systems Renegotiating U.K. Aircraft Carrier Contract Terms

BAE Systems Plc said it is renegotiating contract terms with the U.K. over a 5.3 billion pound ($8.4 billion) effort to building two aircraft carriers, whose costs have already risen more than 50 percent since 2005.

The defense company, Europe’s biggest, is considering contract changes to reflect “increased maturity” of the program, London-based BAE Systems said in a statement today. The first of two carriers is nearing completion.

The company said it’s also in talks with the U.K. government over how to bring shipbuilding capacity in line with demand. The U.K. is not buying enough vessels to sustain three surface shipyards once work on the carriers winds down.

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