The first 25 LAND 400 Phase 2 vehicles will be built in Europe under both BAE Systems' and Rheinmetall's bids for the project to support the tech transfer.
Speaking to Defence Connect, Rheinmetall Australia managing director Gary Stewart said Rheinmetall's decision to build the first 25 Boxer CRVs in Europe was based around not having an established factory in Australia and to enhance its technology transfer program.
"We're doing that A, because we don't have a factory here yet, we have to build it, but secondly it's an instrumental part of our technology transfer program," Stewart said.
"So, one of the key capability benefits to Army and one of the key industrial benefits to the Australian economy is that we set up an enduring industrial capability in Australia that can not only manufacture this equipment, but also design and improve it over life."
Under Rheinmetall's proposal for the project, Australians would be placed into teams in Germany to learn the necessary skills and then bring this back to Australia for the remaining 200 vehicles.
"So, what we do is we'll do the first two variants, finish their designs in Germany, but we'll actually have Australian engineers, logisticians, manufacturing staff and procurement staff embedded in the German teams. So, they learn the product, they learn the technology, they learn how to build it, how to buy it, how to test it and then they come back."
The German company's proposed Military Vehicle Centre of Excellence (MILVEHCOE) will be built in Brisbane while the first vehicles are being manufactured overseas. The MILVEHCOE was announced by Rheinmetall last July and will act as a sovereign industrial capability for the continuous design, manufacture, export and support for military vehicles, turrets and tactical systems.
"Whilst that's happening, we're building and commissioning the Military Vehicle Centre of Excellence, we're bringing on and qualifying the Australian industrial network that will supply the material into that manufacturing and we'll transfer the tools and systems," said Stewart.
"So, at the end of the first couple of years, you'll see all of the vehicles then being manufactured and tested and delivered from the Military Vehicle Centre of Excellence in Brisbane."
As a centre of excellence, the MILVEHCOE would be the focal point for the LAND 400 combat vehicles, LAND 121 logistics vehicles and other complex defence projects. Under the LAND 121 Phase 3B program, Rheinmetall is delivering more than 2,500 logistics trucks to the Australian Army.
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Rheinmetall has already partnered with several Australian SMEs for the project, including Melbourne's Heuch, Cablex and Tectonica Australia, Burnie-based Direct Edge, Brisbane-based G&O Kert, Melbourne/Brisbane-based Hilton Manufacturing, Perth-based Hoffman Engineering, Melbourne-based Nezkot Precision Tooling and Engineering, Adelaide-based Plasteel and Adelaide-based Redarc.
BAE Systems' Brian Gathright also told Defence Connect, should they be successful in securing the project, the first 25 vehicles would be built overseas as part of its plans for technology transfer.
"A total of 200 vehicles produced in Australia. The first of types to make sure we get the manufacturing baseline, and this is critical to that tech transfer piece, will be done in Europe to make sure we have a strong manufacturing base that we can transfer into Australia," Gathright said.
"We will manufacture 200 vehicles here in Australia to a tune of over $1.25 billion. We'll employ somewhere on the order of 50-100 SMEs depended upon the final content breakdown. That content breakdown will occur across the nation. There will obviously be a focal point within Victoria and South Australia, where there's a strong automotive and defence background around armored vehicles. But equally we have companies from New South Wales, Queensland, Tasmania participating in our LAND 400 solution."
Rheinmetall's Boxer CRV is up against BAE Systems' Patria AMV-35, which would be built in Victoria. A decision on the project is expected in the coming weeks.