Wednesday, 21 December 2011

Military vehicle industry on the up?

We try an keep a close eye on the inductries that we are active in, one of these being the military vehicle industry. There has been quite a lot of activity in this arena of late, with General Dynamics completing thier purchase of Force Protection, creating quite a giant in the industry, and Navistar announcing that they too might be entering the JLTV bidding on thier own as well as joining force with BAE Systems.

Joint Light Tactical Vehicle (JLTV) program was an attempt to replace the existing fleet of Humvees with a more survivable and capable family of tactical vehicles. Teams led by Lockheed Martin, General Dynamics/AM General and BAE Systems/Navistar were selected to compete in the program’s technology demonstration phase. When it came time to award contracts for the next or engineering and manufacturing development (EMD) phase, the two services changed the rules. The decision was taken to reduce significantly the requirements for the JLTV in order to bring down the price. DoD altered the potential value of an award by both reducing the number of vehicles it was planning to buy in the initial phase of production and proposing to significantly reduce the award period of future contracts. Given the reduced requirements, it seemed quite possible for new entrants who had not spent the time and money in the demonstration phase to now enter the JLTV competition with an extremely low bid. Finally, the draft request for proposal for the EMD phase proposed a very low dollar award to the winning teams. In addition, there is a Humvee recapitalisation programme, which appears to have been awarded to General Dynamics http://www.shephardmedia.com/news/landwarfareintl/general-dynamics-wins-vehicle-upgrade-contract/#.TtzZ78YVgzU.facebook
Add to that the announcement that the Australian government has announced an order for 1300 Hawkei Vehicles from Thales and it looks like everyone is going to be quite busy next year. It is just a shame that it takes armed conflict and IED's to boost economies.
Australian government commit to 1300 Armoured Hawkei vehicles from Thales. http://news.ninemsn.com.au/national/8388555/aussie-armoured-vehicle-gets-go-ahead
 

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