The deal which Britain, Germany and France have agreed for a new ‘battlefield taxi’ will see the UK’s GKN win initial work worth hundreds of millions of pounds.
But there is some confusion over its precise value. GKN says the Multi-Role Armoured Vehicle (MRAV) project will be worth some £800m to the company, if it runs to its full projected 5,000 vehicles for the three armies. However, this number is significantly higher than that given by Ministry of Defence sources, who say the requirement is for only 3,000 vehicles. The initial contract for 600 vehicles for the British, French and German armies (200 each) would be worth £500m.
This first production run will provide continuity of employment for GKN’s Telford, Shropshire-based workforce of 450-500. The MoD said it could provide up to 500 jobs among GKN’s UK component suppliers.
The Eurokonsortium team selected as the preferred bidder for the MRAV is led by Germany’s Krauss-Maffei and includes Wegmann of Germany (with which Krauss-Maffei plans a merger) and MaK.
State-owned Giat is the French partner and GKN, the British. French government objections over workshare stopped the British and German defence ministries from announcing a few weeks ago that Eurokonsortium had won the MRAV contest, when a press conference was cancelled at the last minute.
France had been a sleeping partner in MRAV, but objected to an Anglo-German plan to announce a major defence programme without French industrial participation, even though there are doubts over the size of the French Army’s ultimate MRAV requirement.
GKN, at least, was under the impression that MRAV was effectively an Anglo-German project until France made its objections.
Defence industry sources said last week that Britain was also unhappy about the prospect of a deal which did not include France, and was not sure about the numbers of MRAVs needed because of its current Strategic Defence Review (SDR).
But no final decisions on further production batches for Britain are needed until well after 2000.
France may yet wish to audit the workshare promised to it and this might not be complete until June.
So far, the three countries ultimately plan to build around 3,000 vehicles in total: 1,400 MRAVs for Britain, 1,100 for Germany and 600 for France.
The Netherlands says it also wants to become a full MRAV partner, while Sweden, Spain and Poland have indicated they may wish to join, though maybe not as full partners.
GKN predicts that ultimately 7,500 MRAVs could be built for the three original MRAV partners and the other countries.
A firm contract for the initial production batch will probably be signed around the end of the year. GKN will build all three countries’ armoured hulls for MRAV and share responsibility for electrical and weapon systems, and will assemble all the British Army’s vehicles.
Eurokonsortium’s bid beat that of the rival Team International led by Germany’s Henschel, which included Britain’s Vickers Defence Systems and Alvis and France’s Panhard.
Team International was bitter about the early preference shown for the Eurokonsortium eight-wheeled MRAV, as Team International initially focussed on a six-wheeler.
Vickers plans to protest about the decision to the UK and German parliaments.
Senior MoD sources in London said last week that the six-wheeler was rejected on its power-to-weight ratio and its allegedly less impressive capacity for upgrades. They said Eurokonsortium’s vehicle offered the best capability and value for money. They also said Team International’s belated 2 March offer of an eight-wheeler had not changed their mind.
MoD insiders said the critical feature of the three countries’ choice was the Eurokonsortium MRAV’s greater ability to accept extra add-on armour.
Vickers claims its eight-wheeler would have cost less than Eurokonsortium’s MRAV, a point on which the MoD sources did not comment.
The first production MRAVs are supposed to enter service in 2007-08, five years later than originally desired by the British Army. As far as the British were concerned, there was no time to be lost. This apparently added to its scepticism about the late Team International offer.
The Vickers team has not given up all hope. The initial contract will be followed sometime after the turn of the century by orders for the second and subsequent production batches.
These orders, Vickers says, will once again be open to competition, though MoD insiders would only say this was just an option which could help ensure Eurokonsortium is kept on its commercial toes. The nations involved in MRAV will apparently retain the design rights.
Whether Vickers and GKN now resurrect their stalled merger talks is unclear, although further rationalisation in the European armoured vehicle industry seems likely.
Eurokonsortium has so far only presented a wooden mock-up of its winning vehicle. But the MRAV’s function will be to provide the basis for a family of vehicles to serve as armoured personnel carriers hence the term ‘battlefield taxi’ and also as command, mortar-carrying and other support vehicles, with variants for the three armies now in the project.
While MRAV will be able to resist small arms fire, shell splinters and some mines, it will not be a true infantry fighting vehicle (IFV) in the modern sense of the term.
Britain’s present GKN-built Warrior IFVs will need replacing from around 2012.
That replacement project was originally described as the second element of the MRAV programme, which would have provided a well-armed tracked vehicle. But a few months ago this MRAV variant was abandoned to be replaced by the redefined ‘Future IPV’ project.
The wheeled MRAV project could be worth £1.5bn to the UK now and the Future IFV could be worth another £1.5bn, the MoD said. But it is still very early days and the SDR could yet upset both the MRAV and Future IFV apple-carts.