BAE focused on continuing profitability in combat vehicle portfolio

BAE Systems President and CEO Tom Arseneault says after a positive first half of 2023 in the combat vehicles area, the company expects part of the business to remain profitable.

Order intake in BAE’s platforms & services sector, which includes combat vehicles, weapons and munitions, was $5.1 billion in the first half of 2023, compared with $2 billion in the first half of 2022, according to a company earnings statement. Sales in the sector were $2.3 billion in the first half of 2023, compared to $2.1 billion in the first half of 2022.

According to the company, much of the order intake has been driven by the awards of the Armored Multi-Purpose Vehicle to the U.S. Army, as well as awards of the CV90 fighting vehicle in Europe and the BvS10 to multiple European nations and the United States.

Arseneault said Wednesday during a company earnings call that the company was disappointed in the Army’s decision not to move forward with BAE in the down select of the XM30 Mechanized Infantry Combat Vehicle -- the eventual successor to the Bradley Fighting Vehicle. Instead, the company plans to focus on “what’s been a buildup and backlog for the combat vehicles business,” he said.

“That business has been on a good margin expansion journey. We expect that to continue,” he said.

Arseneault also touted the Army’s recent decision to move the AMPV program to full-rate production, and said BAE expects a contract in the second half of the year.