Project Overlander, LAND 121 armoured vehicle contract awarded

Minister for Defence Stephen Smith and Minister for Defence Materiel Jason Clare today announced that the Government had taken the next step in the $7.5 billion Project Overlander that will provide the Australian Defence Force with around 7,500 new vehicles over the next decade.

Project Overlander will replace the current fleet of Land Rovers, Unimog, Mack and S-Liner trucks and their associated trailers and modules.

These new vehicles represent a significant increase in capability, replacing multiple vehicles fleets that have been in service since the early 1980s.

LAND 121 Phase 3B Protected and Unprotected Medium and Heavy Vehicles

Rheinmetall MAN Military Vehicles Australia has been down-selected as the preferred tenderer and will now enter into detailed negotiations to provide up to 2,700 protected and unprotected medium and heavy vehicles under LAND 121 Phase 3B.

Options will also be sought for approximately 1,000 more unprotected vehicles for training purposes under LAND 121 Phase 5B.

This decision has been made after lengthy tender evaluations that involved both desktop analysis and vehicle performance testing. Rheinmetall MAN was selected as it offered the best value for money and met Defence requirements for capability and cost.

These vehicles will replace the Australian Defence Force’s current fleet of Unimog, Mack and S-Liner trucks. They include:

• Medium and Heavy recovery vehicles;
• Medium and Heavy tractors (equipment transporters);
• Heavy integrated load handling vehicles (self-loading hook lift trucks); and
• Medium-weight tray variants (with cranes and tippers).

The new vehicles will improve performance and protection as well as provide commonality across the fleet which will improve Army’s training and logistic support requirements.

Subject to successful negotiations, it is anticipated that approximately 35 per cent of the value of the Phase 3B work will be undertaken in Australia by Rheinmetall MAN and its Australian subcontractors.

The work in Australia will provide significant opportunities for Australian industry, including the installation of locally supplied bodies and modules, and integration of vehicle parts and testing. This work is expected to be undertaken in Wacol, Brisbane. The through life support for the vehicles is also expected to be undertaken in Australia.

Defence will also enter into negotiations with Australian company Haulmark Trailers, as the preferred tenderer to supply up to 2,500 trailers for these medium and heavy vehicles. Subject to satisfactory negotiations, the trailers will be manufactured at Haulmark’s Brisbane facility and this work is expected to create up to 75 jobs and sustain approximately 150 jobs.

Commercial negotiations are expected to inform second pass approval by Government in 2013. Should a satisfactory commercial outcome not be achieved, Defence has reserved the right to engage other tenderers.

Subject to contract negotiation and the options exercised by Defence, the cost for Phases 3B and 5B is now expected to cost more than the original budget estimate from August 2007.

The additional funds will come from surplus funds previously committed to LAND 121 Phase 2A and 3A, LAND 17 Phase 1C Artillery Replacement and LAND 112 (Australian Light Armoured Vehicle Enhancement) and JOINT PROJECT 2048 Phase 3 (Amphibious watercraft).

The first stage of the upgrade to Australian Light Armoured Vehicles (ASLAVs) has been completed in Afghanistan. This included the fitting of US Marine Corps belly plates and blast protected driver seats.

The Government has decided not to proceed with the second stage of upgrades to ASLAVs on the advice of Defence. The second stage was developmental and considered too risky to proceed with.

LAND 121 Phase 4 Protected and Unprotected Light Vehicles

LAND 121 Phase 4 is a $1.5 billion project that seeks to provide up to 1300 protected and unprotected light vehicles.

Thales Australia’s Hawkei has been selected as the preferred vehicle for the development and testing under Stage 2 of the Manufactured and Supported in Australia (MSA) option under LAND 121 Phase 4.

Following exhaustive testing and assessment of the MSA participants, Defence recommended the Hawkei vehicle as it was most likely to meet the future capability and value for money requirements of the LAND 121 Ph4 MSA option.

The next stage of Phase 4 will include funding for further development and testing including the manufacture of prototype vehicles.

Subject to successful testing of the vehicles, final Government approval of the project is expected in 2015, and production work could potentially commence in Australia as early as 2016.

Thales Australia is currently manufacturing Bushmaster Protected Mobility Vehicles at its factory in Bendigo. This manufacturing capability, and the skills of the workforce, is an important national security capability.

On current plans, manufacture of Bushmasters at Bendigois expected to be completed before the end of 2013.

In order to retain critical skills in Bendigo while the design of the Hawkei is finalised and proven, the Government has agreed to explore the purchase of additional Bushmaster vehicles.

The approval to acquire additional Bushmaster vehicles will be dependant on Thales demonstrating an efficient, effective and innovative program to maintain core protected vehicle manufacturing skills atBendigo and in successfully meeting technical performance, cost and schedule commitments in the development of the Hawkei vehicle.

Progress towards a suitable production-ready Hawkei will be measured through a series of milestones. Thales will need to successfully demonstrate the maturing design of the vehicle.

Defence will continue to monitor progress of the US Joint Light Tactical Vehicle program, however, no additional funding commitments have been made at this stage.

LAND 121 Phases 3A and 5A Light and Lightweight Tactical Training Vehicles

The production of 1,187 Mercedes Benz G-Wagons was approved in 2007 to replace the Australian Defence Force’s current fleet of Land Rovers under LAND 121 Phase 3A.

In August this year, the Government announced that a further 959 G-Wagons would be purchased under LAND 121 Phase 5A to provide a fleet of tactical vehicles and an enhanced training capability to prepare for operations in protected vehicles.

Modules for these vehicles will be manufactured and integrated by G. H. Varley Pty Ltd in the Hunter Valley of NSW and the trailers will be sourced from Haulmark Trailers.

Vehicle deliveries commenced in March this year in accordance with the acquisition schedule. To date 307 production vehicles have been delivered to units including RAAF Base Amberley, Latchford Barracks and the Army School of Electrical and Mechanical Engineering in Albury.

The main roll-out of vehicles to Defence units is scheduled to occur between July 2012 and 2015.