Thales wins $1b-plus ADF contract

THE Australian Defence Force (ADF) has signed a $1.3 billion contract with Thales Australia for the supply of 1100 Hawkei protected light mobility vehicles.

The contract secures the future of the Thales vehicle plant in Bendigo, which currently produces around 60 Bushmaster 10-seat armoured vehicles a year.

The deal also includes the supply of 1000 trailers, which will be made by another Australian supplier.

The awarding of the contract was announced by prime minister Malcolm Turnbull and federal defence minister Marise Payne at the ADF’s proving ground at Monegeetta, north of Melbourne.

The Hawkei will replace around one third of the ADF’s fleet of Land Rovers, which do not carry the sort of armour now considered necessary.

The contract is a significant win for the French Thales group, which was initially ruled out of the running.

The Hawkei had to overcome competition from a new vehicle being designed in the US, known as the Joint Light Tactical Vehicle (JLTV). The ADF actually funded the development of nine of the first 30 JLTV prototypes before deciding to consider an Australian-built option.

After opening up the contract to local suppliers, the ADF conducted rigorous testing on six Hawkei prototypes, starting in December 2012.

The US JLTV was intended as a replacement for the Humvee. The $US6.7 billion ($A9.47 billion) JLTV contract was awarded to Oshkosh Corporation in August.

Mr Turnbull said the Hawkei was a 21st century vehicle fitted with all the latest technology and would help Australia become a military leader.

“Like the native death adder from which it takes its name, this vehicle is at home in the most difficult terrain,” Mr Turnbull said.

Ms Payne said the Hawkei would be ahead of its international competition and that there was “enormous potential” for it to be sold to international buyers.

“The fact that it is a lighter vehicle than the traditional Bushmaster, the fact that it has a degree of mobility in very high-risk areas, and has a significant degree of blast and ballistic protection for our serving members means that it should be very attractive on the international market,” she said.

A key part of the specification under the Land 121 Phase 4 project was that the vehicle not be heavier than 7000kg, which is the payload capacity for the Chinook helicopters that will most often deploy the vehicle.

“We will work closely with Australian defence industries to make the most of those opportunities wherever and whenever we can,” Ms Payne said.

“As well as Victoria, there’s obviously support and sustainment activities that occur elsewhere in Australia as well, so it does have a positive and very beneficial effect for Australian industry elsewhere.”

Thales Australia chief executive Chris Jenkins said the Hawkei had a strong future ahead of it and that the local am would be assisted by the global Thales group in securing export sales.

“This is a great day for the ADF and for Australian industry,” he said.

“Hawkei is a highly capable vehicle that will serve this country well for many years to come, and we are delighted that the department of defence has recognised the importance of this vehicle by reaching this milestone.” He said there were already several variants of the Hawkei – including command, liaison, special operations, border protection and utility – and that Thales would ready to adapt it to any other requirements. It can seat up to six personnel, including the driver.

“We also thank our many suppliers on the program – companies in Australia and overseas that have been with us on this long journey, and who have played a significant role in shaping the Hawkei and contributing to its success,” Mr Jenkins said.

“It’s a great story about what Australian industry and international partnerships can achieve.

 “As we move into the manufacturing phase, we will now be able to consolidate the work already begun across the Thales group worldwide to ensure the export success of this impressive vehicle.”

Speaking before the contract announcement, federal opposition leader Bill Shorten applauded the award of the contract to an Australian supplier. He said big defence contracts should stay in Australia.

“Ideally they should be built and the money should be spent in Australia,” he said.

“We want make sure that we have the best quality equipment for our service people, but we want to make sure that — all things being equal — the money gets spent in Australia.”

The contract is part of a massive overhaul of the ADF vehicle fleet under Project Land 121, which will see the ADF acquire 7500 light, lightweight, medium and heavy-duty vehicles, both protected and unprotected.

The Hawkei contract is Phase 4 of the Land 121 procurement plan, which has already seen contracts awarded to Mercedes-Benz for 2146 unprotected G-Wagons and to Rheinmetall MAN for 2700 medium and heavy-duty vehicles.

Like the Hawkei contract, both these contracts also include quantities of Haulmark trailers made in Australia.

The three-and-a-half-year Hawkei production run will start in 2017 and help maintain employment in the Bendigo plant at around the 170 mark, plus 60 jobs in supplier companies.

The €14.4 billion ($A22.9 billion) Thales group operates in a wide range of disciplines in both the civil and military spheres. It works in diverse areas from delivering payloads into space through rail and aviation transport to IT security and defence electronics.

The Bendigo plant is the group’s only vehicle manufacturing site and does all its own design and procurement and development of production systems.

The only vehicle the Bendigo plant makes at the moment is the Bushmaster, a four-wheel armoured vehicle that can seat up to 10 personnel. It has a V-shaped hull for blast protection and comes in seven different variants.

It is used by the Australian and Netherlands armies and has seen action in East Timor, Afghanistan and Iraq.

A total of 1040 Bushmasters have been made since it went into production in 1998. In July the Dutch defence forces ordered a further 12 Bushmasters for its Light Brigade, bringing to 98 the total acquired since 2006.