A further order for warships is expected to be placed in Scotland with Babcock in line to build four Type 31 frigates worth £1 billion at its Rosyth yard for the Danish navy.
The defence company is also competing with a French shipyard for seven of the same vessels for Sweden’s navy. Final decisions are due early in the new year.
The Rosyth workforce of 2,500 could rise to 4,000 if it wins both bids, adding to its other work in maintaining the Royal Navy’s aircraft carriers.
The latest potential orders come just a week after BAE Systems secured a contract to build larger Type 26 ships at Govan and Scotstoun on the Clyde for the Royal Norwegian Navy.
The Type 31 is a “general purpose” fighting ship – also known to the Babcock team selling the design around the world as Arrowhead 1400.
The first of five Type 31s for Britain’s naval fleet – due to be named HMS Venturer – is being fitted out in dry dock.
Babcock has sold its design to the governments of Indonesia and Poland for construction in their yards and a team from Rosyth is working in Poland.
The company plans to build another covered hall at Rosyth to enable more vessels to be built simultaneously and without weather interruptions.
David Lockwood, chief executive of the Babcock group, said the boost in defence spending by Nato countries including the UK is welcome for the industry.
“It helps underpin the UK as an exporter of warships to allied nations, which we haven’t done for a long time,” he said.
“The UK is in a position it hasn’t been in for many decades as a shipbuilder.”
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