BAE Systems has been nominated prime contractor in the construction of the Royal Navy's two new aircraft carriers.

Although the Ministry of Defence conceded that BAE's rival, the French company Thales, had produced the better design, ministers opted to safeguard thousands of jobs by backing BAE.

Forum Response: BAE Systems

Chris Geoghegan, chief operating officer of BAE Systems, said: "We are delighted that BAE Systems has been chosen to be prime contractor for Britain's biggest ever warship contract, the next generation carrier. We will be taking responsibility for the design and integration of the highly complex systems, as well as for the construction and support of a vital British naval system expected to be in service for the next 50 years.

"Our task now is to work with the MoD to bring together the best industrial capability Britain can offer. We look forward to working with key suppliers, including Thales, to deliver to the Royal Navy a world class sea system, vital for the protection of our national interest."

Forum Response: GMB

Keith Hazlewood, national secretary of the GMB, said: "It is important that this order for the Royal Navy is built and delivered both on time and in budget so that this can be the beginning of the revitalisation of UK shipbuilding.

"The unions and industry welcomes the government's decision to support the UK shipyards by securing work for the next decade and beyond through the Labour government's procurement strategy led by Geoff Hoon the secretary of state. We hope that this is the first step to a brighter future in our shipyards."