Page 74 - Australian Defence Magazine Sep-Oct 2022

74 LAND WARFARE LAND 400
SEPTEMBER-OCTOBER 2022 | WWW.AUSTRALIANDEFENCE.COM.AU
LAND 400 IN THE SPOTLIGHT
Both multi-billion dollar phases of the most expensive acquisition project in the history of the Australian Army are facing uncertainties in implementation.
JULIAN KERR | SYDNEY
AT THE time of writing, it was uncertain whether a crucial announcement anticipated in September disclosing the company that will supply up to 450 infantry fighting vehi- cles (IFVs) to Army at a cost approaching $27 billion might be delayed until March and completion of the Labor gov- ernment’s defence strategic review.
Whenever the selection is announced, both industry and Army then face the prospect of the significant last-minute reductions in the scope of Project Land 400 Phase 3 that have been signalled by Defence as being under consideration.
BUDGET PRESSURE
The cost of the IFV program has been under pressure since the surprise allocation in the March defence budget of nearly $10 billion over the next decade to boost the cypher and in- telligence capabilities of the Australian Signals Directorate.
The rationale for acquiring a substantial number of large and expensive land vehicles at a time when the strategic fo-
cus is on long-range power projection and submarines has also come under attack – and been strongly defended as the core of Army’s close combat team.
According to informed sources, competing tenderers Rheinmetall Defence Australia and Hanwha Defense Aus- tralia were requested by Defence around mid-June to re- submit their bids scaled down to supply 300 IFVs instead of the 450 that had originally been mooted to replace Army’s expensively upgraded but now obsolete M113AS4 armoured personnel carriers.
This left the entire industry supply chain scrambling to revise quotes before the end of July to the pricing model in the final proposals submitted by both companies in late 2021 after two years of risk mitigation activities involving the Rheinmetall Lynx KF41 and Hanwha’s AS21 Redback.
The companies were also asked to submit bridging bud- gets enabling the Commonwealth to consider adding to a 300-vehicle contract in increments of 50 vehicles. No