BAE bid for Army scout tank seen as £4bn lifeline
BAE Systems will this week submit its bid for the first stage of a £4billion contract to build armoured reconnaissance vehicles for the British Army.
The defence giant will be going head-to-head with US group General Dynamics for the order for 600 vehicles to be used by soldiers in Afghanistan. The new CV90s will replace the 30-year-old Scimitar scout car that is vulnerable to roadside bombs.
The first phase of the contract is worth £2billion, with the rest following in future phases.
Winning the contract will help BAE secure UK jobs, though the company has not yet decided where work would be carried out. The BAE combat CV90 vehicle’s chassis is made in Sweden by its subsidiary Hagglunds.
The contract will be announced in the first quarter of next year.
If it loses the deal, BAE might have to shut its armoured vehicle business in Britain. It has already cut 700 jobs from the division this year. Sources say the contract could provide a crucial lifeline for the business.
The bid battle will open as BAE is facing prosecution by the Serious Fraud Office over bribery allegations in Africa and Eastern Europe. The SFO is expected to make its submission to the Attorney General, Baroness Scotland, shortly. The company was also criticised last week in a report on the Nimrod plane crash that killed 14 servicemen.
General Dynamics is championing a vehicle called Ascod, which was first built as a joint venture between the governments of Austria and Spain.
