The British government has awarded a £165 million contract extension to Italian defense firm Leonardo for maintaining the Royal Navy’s fleet of 54 Merlin helicopters. This move reflects the UK’s commitment to increasing defense spending.

Under Keir Starmer’s administration, the UK plans to raise military spending to 2.5% of GDP by 2027. The deal with Leonardo is seen as a step towards enhancing national security. “This investment demonstrates our unwavering commitment to maintaining cutting-edge defense capabilities that keep us safe, while utilizing defense as an engine for economic growth,” stated Maria Eagle, the minister for defense procurement and industry.

Leonardo announced that the contract extension will support 1,000 jobs, including 200 at its Yeovil factory in Somerset and 800 across the broader UK supply chain. It will also sustain jobs at the Royal Navy’s airbase in Culdrose, Cornwall.

The Ministry of Defence describes the Merlin helicopters as “submarine hunters” capable of intercepting pirates and drug runners, saving mariners in distress, and delivering supplies and personnel. Nigel Colman, managing director at Leonardo Helicopters UK, remarked, “Working closely with the Ministry of Defence and Royal Navy, we’re keeping the Merlin fleet supported and available, so it’s ready to fly whenever and wherever it’s called upon.”

The Merlin helicopter, known for its appearance in the James Bond film “Skyfall,” is manufactured at the Yeovil plant, the UK’s last remaining helicopter factory, which also handles some maintenance tasks.

Leonardo serves as the prime contractor for the Merlin helicopter maintenance, with Lockheed Martin and Serco as subcontractors. The UK government has announced plans to increase defense spending by approximately £13.4 billion annually from 2027, with a goal to reach 3% of GDP in the next parliament.

This contract extension coincides with the retirement of the Royal Air Force’s Puma helicopters after over 50 years of service. The Ministry of Defence has yet to announce a replacement for the Puma.

Leonardo has emerged as the sole bidder for a £1 billion contract to build new medium-sized helicopters, proposing the AW149, which would be constructed in Yeovil. The government is expected to award the contract for a new medium helicopter later this year.