WASHINGTON -- British naval manufacturer Babcock International has announced a £140 million ($189.5 million) charge on its contract for the Royal Navy’s Type 31 frigate program, primarily due to significant redesigns and late-stage reworks. The company revealed that during the outfitting and commissioning phases, construction teams experienced higher-than-expected levels of rework necessitated by design changes and "out-of-sequence" build activities from earlier in the program. Because these modifications are being performed in the final stages of completion, they have become more complex and costly, particularly for the first two ships in the five-vessel class, HMS Venturer and HMS Active.
The additional costs are partly attributed to the decision to prepare the ships for future upgrades, such as the installation of the MK 41 Vertical Launch System (VLS), which requires structural adjustments to cabling and internal corridors after construction had already begun. Of the total charge, approximately £100 million will be recognized as a revenue reversal for the 2026 fiscal year, with the remainder added to contract loss provisions.
