The Andrews Labor government signed a heads of agreement with BAE Systems to build state-of-the-art vehicles at the former Holden site at Fishermans Bend, should it win the contract for the LAND 400 Phase Two project.
Premier Daniel Andrews and Minister for Industry and Employment Wade Noonan visited the General Motors Holden site at Fishermans Bend to announce that Victoria had been selected as the preferred state by BAE Systems Australia to build 225 new Combat Reconnaissance Vehicles.
BAE Systems has said it will combine its Victorian maritime, aerospace and land businesses into a single defence hub at Fishermans Bend, which would become the biggest of its type in Australia, if it is selected as the preferred tenderer.
BAE Systems is competing with Rheinmetall Defence Australia for the contract. BAE Systems has put forward its Patria AMV35 while Rheimetall has offered the Boxer CRV.
Rheinmetall has named Queensland as its preferred manufacturing site for the 224 vehicles.
A final decision on which state is awarded the contract rests with the Turnbull government.
Victoria is hoping its history in the manufacture of military vehicles, for both Australia and other countries, will see it over the line. Currently, the world-class Bushmaster and Hawkei vehicles are manufactured at Thales in Bendigo.
"Victoria is the traditional home of vehicle manufacturing, and this project would create thousands of jobs at a time when our automotive sector is in transition," said Premier Andrews.
“Our message to Malcolm Turnbull is simple – bring this work to Victoria. We have the workforce, the track record and the supply chain to get it done.”
Minister Noonan said securing the contract would help revitalise Victoria's suffering automotive industry.
The state's research and development expertise, highly-skilled workforce and supply chain makes Victoria the natural home of vehicle manufacturing, according to the state government.
“Victoria’s automotive workers deserve certainty at a time when local car manufacturing is coming to an end," Minister Noonan said.
“This project is the perfect opportunity to harness our highly-skilled manufacturing workforce and build the next-generation of combat vehicles that will help keep our troops safe.”
The LAND 400 Phase 2 project is worth around $5 billion and would create more than 2,000 manufacturing and supply chain jobs in Victoria.
Victorian defence companies would get a large share of the work, with BAE Systems agreeing to partner with Marand, MOOG Australia, Motec, AME Systems, RUAG Australia, DVR Engineering and APV to build vehicle components.
The new fleet of vehicles will replace the current Australian Light Armoured Vehicle (ASLAV) fleet.
Victoria’s defence sector is worth $8 billion to the local economy every year, and is made up of about 20,000 people and 400 businesses.