Shareholders in armoured vehicles group Alvis last week gave the go ahead to the company’s planned merger with GKN Defence.
But there is concern that the incoming German government which includes the Greens might cancel the multi-role armoured vehicle (MRAV) ‘battlefield taxi’ contract, worth £2bn.
German social-democrat politicians appear to have achieved a partial compromise in the Greens’ election manifesto. This is believed to have included some of the environmentalists’ most radical policies, including axing Germany’s nuclear power programme.
But UK defence industry sources believe large defence contracts already signed will go ahead.
One defence analyst said it was unlikely the Greens’ objections to major defence projects would win the day when thousands of German engineering jobs could be affected by the cancellation of the MRAV contract.
‘Legally the Germans are obliged to participate in Eurofighter. As far as the MRAV programme goes, it depends what’s been signed. At the end of the day I don’t think any politician is willingly going to sign away jobs,’ he said.
GKN and Alvis are both members of the Eurokonsortium group picked by the French, German and British governments as favoured suppliers for the contract.
Vickers, the losing bidder in the MRAV deal, is looking for government support to develop its own version of the battlefield taxi.