Vickers could offer for export some of the tanks which will be put into storage following the strategic defence review. This would eliminate the production lead-time for new tanks and help boost exports.
Some of the army’s 386 Challenger II main battle tanks on order will go into storage when they are completed. A Vickers source said offering them for sale was ‘an option’.
Any such deal ‘would depend on the state of readiness and different specifications that other armies might require, for instance in communications equipment’.
Challenger II has already been exported to Oman. The main sales targets are Greece and South Africa. Qatar may buy up to 40.
It is not clear if tanks sold from storage would be replaced to maintain the army’s inventory. Vickers sees the maintenance and storage of tanks as a business opportunity in itself.
Talk of the closure of one of Vickers’ tank factories in Leeds or Newcastle was dismissed, because ‘a string of potential overseas orders’ could prolong Challenger II’s production run, the sources said.
Vickers this week confirmed that it would expand its marine propulsion division, using some of the £200m earned from the sale of Rolls-Royce Motor Cars to Volkswagen. It said it could also soon sell propulsion business Brown Brothers. Vosper Thornycroft is a possible buyer.
Defence review, page 20