UK urged to pick Airbus over Lockheed for £2.4bn satellite 2026

The £2.4bn military satellite contract for the UK Ministry of Defence’s Skynet 6 system has become a major test of Andy Burnham’s pledge to use public procurement to back British industry. Labour’s largest union backer, Unite, is urging the government to award the deal to European manufacturer Airbus over US rival Lockheed Martin, warning that up to 600 jobs at Airbus facilities in Stevenage and Portsmouth could be at risk.

The bid battle between Airbus and Lockheed Martin

The Skynet 6 wideband satellite system (WSS) will involve two geostationary satellites carrying sensitive military data. Airbus, which designs and builds satellites in the UK, has a strong existing workforce, while Lockheed Martin has promised to create 500 direct jobs in north-east England and another 1,500 in the broader supply chain if it wins the contract. Critics, however, argue that Lockheed’s bid relies on American intellectual property rather than UK-developed technology.

Why Unite is backing Airbus

Sharon Graham, general secretary of the Unite union, described choosing a US company as a “massive mistake”. She emphasised that the contract is an early test of how Burnham’s “backing Britain” pledge will work in practice. The Labour MP for Stevenage, Kevin Bonavia, is also putting pressure on the government to secure existing jobs at Airbus.

Lockheed Martin’s counteroffer

The US company has pledged to keep any intellectual property it develops in the UK and has already invested in a research partnership with Northumbria University. Lockheed also highlights export potential from the UK to other countries, as well as integration with the US military. However, union leaders fear that British technology and sovereignty could be compromised.

Comparison of the two bids

Key takeaways

• Airbus safeguards existing skilled jobs in Stevenage and Portsmouth.
• Lockheed Martin offers a larger total job creation number but relies on US IP and supply chains.
• The decision will test Labour’s commitment to British industry under the new defence secretary, Wes Streeting.
• Relations with the Trump administration add a geopolitical dimension to the contract award.

FAQ

With the defence secretary now involved, the outcome of this contract will be closely watched as an indicator of the UK’s defence procurement direction under a Labour government and its relationship with the US. The decision is expected within the coming months.