BAE Systems will invest £100m into its Glasgow shipyards to improve and expand manufacturing facilities.
The investment, following a review of future options, will be the largest BAE Systems has made into the Govan and Scotstoun shipyards in decades. The firm had also considered keeping only one of the shipyards and rebuilding it into a state-of-the-art manufacturing facility with a £200m investment.
"Following an assessment of potential facilities options, we have decided to retain and invest in both of our sites in Glasgow,” BAE Systems’ spokesman said.
"We will work closely with our trade unions as we prepare the detailed designs to improve and expand our manufacturing facilities, which will mark the most significant investment in the Glasgow shipyards in decades."
Planning applications for both proposals were lodged last year, neither of which was expected to lead to job losses, despite the one-site strategy posing obvious questions over the future of the Govan shipyard.
"Together with investments in new technologies, cutting-edge processes and new ways of working, improved infrastructure will play a key role in transforming the way we design and build complex warships,” BAE Systems said.
"This will enable us to create a modern, safe and inspiring workplace for our employees whilst ensuring we deliver equipment to the highest quality at the lowest possible cost so we can compete effectively for future UK and international orders."
Regional politicians welcomed the decision, saying it would lead to job security and confidence in the region.
"We met with BAE today and are delighted by their decision to keep both the Govan and Scotstoun yards open,” said Chris Stephens, MP for Glasgow South West, and Carol Monaghan.
“The yards will continue to work together to build the next generation of Royal Navy warships. The building of the Type 26 Frigates offers long term job security and will be welcomed by workers on both sites.”
Scottish Conservative West of Scotland MSP Annabel Goldie said: "This is a tremendous statement of confidence in the United Kingdom's defence capacity. It is also a very welcome statement of confidence by BAE in the skills of shipyard workers in Scotland."