By the time these words appear in print the tender for Land 400 Phase 3, Army’s $15 billion Infantry Fighting Vehicle (IFV) acquisition program, will have closed.
Companies wishing to participate in Australia’s largest ever investment in capability in the Land domain had to have their bids in the box on March 1. The Commonwealth is expected to release the names of companies shortlisted for further evaluation in the third quarter of this year.
Land 400 Phase 3 is seeking to acquire up to 450 tracked IFVs to replace the obsolescent M113AS4 Armoured Personnel Carriers (APCs) which, although upgraded in recent years, have nevertheless been in the inventory since the Vietnam War in the mid-1960s. In Army-speak the new vehicles will, “Allow Army to successfully sustain mounted close combat operations against emerging and future threats, as part of a Joint force.” This has otherwise been referred to by some observers (with tongue in cheek) as, “The last 500 metres of government diplomacy”.
Given the timing of bid closure, bidders themselves and the Commonwealth are understandably reluctant to discuss the project in any great detail with ADM at the present time, but here is what is known so far.
Overview and timeline
Land 400 Phase 3 (Mounted Close Combat Capability) is a natural follow on to the earlier Phase 2, valued at $5.2 billion, which is delivering a fleet of Rheinmetall Boxer 8x8 Combat Reconnaissance Vehicles to replace Army’s Australian Light Armoured Vehicle (ASLAV).
The Phase 3 project seeks to acquire a family of tracked IFVs and a Manoeuvre Support Vehicle capability for combat operations in high threat environments, therefore it must be able to provide mounted soldiers with a high level of protection and provide support to them when they are dismounted.
Under the terms of the RFT, Defence will acquire up to 450 IFVs capable of fulfilling a number of roles, together with 17 Manoeuvre Support Vehicles.
A Request for Tender (RFT) was released to industry on August 24 last year and this was followed by an industry briefing at the 2018 Land Forces conference in Adelaide the following month.
“The project is currently focussed on preparation for evaluation of the tenders. While Defence is not in a position to provide comment on potential contenders in accordance with the Commonwealth Procurement Rules, there has been a positive response from industry, including through engagement at Land Forces 2018,” a Defence spokesperson told ADM in early February.
The Phase 3 process has incorporated lessons learned from the earlier Phase 2 journey, including listening to feedback from industry, but it is nevertheless following a similar pathway.
“This includes significant market research undertaken into capabilities sought under this RFT, with industry helping to shape requirements through a Request for Information (RFI) released in 2015, unsolicited proposals from industry received by Defence in 2017 and feedback from the draft RFT package prior to its release,” Defence said.
Defence says that it has listened and responded to industry feedback, which has resulted in the extension of the proposed vehicle mobilisation period for the Risk Mitigation Activity (RMA) from six months to 12 months. This it says, will provide the tenderers with a more reasonable timeline in which to manufacture and prepare test vehicles to the configuration required.
“The project has reduced the burden on tenderers during Stage 1 – Detailed Evaluation requirements for the Australian Industry Capability (AIC) plan,” the spokesperson said. “The tender seeks a ‘plan for a plan’, which articulates the proposed approach to deliver the final AIC plan over the course of the Stage 2 RMA.”
This approach will leverage the development work done through engagement with industry during the RMA and is intended to reduce both the cost and the impact on resources for industry and the Commonwealth. Defence says this will allow the shortlisted tenderers and the Project Office to optimise Australian industry content and participation throughout the life of the project.
Defence also states very clearly that incumbency (referring to the successful Phase 2 bidder in Rheinmetall) will neither be an
advantage of disadvantage regarding the Phase 3 RFT process.
“Defence deliberately de-linked phases 2 and 3 of the program in 2014 to ensure that ‘best of breed’ solutions be fully examined for each of the program’s key platforms, the CRV in Phase 2 and the IFV and MSV in Phase 3,” the Defence spokesperson explained.
Each submission against the Phase 3 RFT will be considered for the best capability outcome within value for money considerations, but the document only lists three essential requirements. These are the ability of the IFV to carry six dismounts, the capability of it to be strategically deployed by the Navy’s two Canberra-class Landing Helicopter Dock (LHD) ships and the ability of it to be carried aboard RAAF C-17A strategic airlifters.
The RFT is seeking options from industry to reduce costs over the lifecycle of the vehicles by leveraging common sub-systems, consumables and training with the Phase 2 vehicles.
“To achieve this, the project has requested that tenderers provide a baseline tender response which incorporate the Electro Optic System’s Remote Weapons System and Rafael Spike LR2 Anti-Tank Guided Missile (ATGM) common with Land 400 Phase 2,” Defence explained. “Tenderers are able to propose alternative sub-systems, consumables and training separate to their baseline proposal where they believe the alternative represents a better value for money for the Commonwealth.”
But as program director Brigadier Gus McGlone has pointed out to ADM previously ‘commonality does not mean identicality’.
Defence also has a preference for a manned turret for the IFV variant, due to what it perceives to be the technical immaturity of unmanned solutions to meet Army’s overall requirements and timing, thereby reducing risk.
“This decision was informed by the extensive industry solicitation undertaken since 2015,” the spokesperson said. “The project will work with shortlisted tenderers during the RMA to explore the growth path to a potential future unmanned or optionally manned turret solution for the vehicles.”
Australian Industry Capability
Australian Industry Capability (AIC) is an important consideration for the Phase 3 program and a number of Sovereign Industrial Capability Priorities (SICPs) have been identified, including the Land Combat Vehicle and Technology Upgrade. Defence notes that the earlier Land 400 Phase 2 project has achieved an AIC of over 60 per cent.
“Throughout the tender process, Defence will work with shortlisted tenderers to optimise Australian industry participation. These activities will include refinement of tenderers’ overall proposal, including the final version of their AIC plan and participation in the mandatory Australian Industry Roadshow,” Defence said. “The roadshow will allow companies across
Australia to showcase potential opportunities to increase the work undertaken by SMEs.”
The AIC requirements described in the Phase 3 RFT include the SICPs that are relevant to this phase of the program and Defence says the evaluation process will include an assessment of each bid to achieve the overall AIC requirements as laid out in the document.
“Tenderers will be evaluated on the proposed value of work to be performed in Australia, the economic benefit to the economy and the manner in which this will be achieved,” the Defence spokesperson explained.
The list of potential bidders for the Phase 3 program at the time of the Land Forces exhibition last September (see ‘Land 400 Phase 3 contenders on show’ on P16 of the October issue of ADM) included BAE Systems, GDLS-A, Hanwha, Rheinmetall and PSM – a joint venture between Kraus-Maffei Wegmann (KMW) and Rheinmetall Defence.
However, since that time at least one company has decided against bidding and a second had yet to publicly announce its decision as ADM closed for press. Others acknowledge their intent to bid, but are reluctant to share much in the way of detail.
This article was written before bids went in the box in March.
BAE Systems was one of the two finalists for the Phase 2 competition with its AMV-35, ultimately losing out to Rheinmetall. The company says is considering a response based upon the BAE Systems Hägglunds CV90 for Phase 3, but as of early February had yet to announce publicly whether it would submit a bid.
“We are currently assessing our position, based on the Commonwealth’s RFT and this assessment is subject to our routine processes and approvals. If we do bid Land 400 Phase 3, our offer will be the BAE Systems Hägglunds CV90, well recognised as the world’s exemplar IFV,” a company spokesperson said.
“As always, we look to support the Commonwealth to protect our military forces where we can offer value for money, high performance system solutions that meet their needs. We are assessing the RFT and will make a decision in due course.”
ADM understands from sources close to the company that the BAE Systems will bid the program despite being cagey about the issue. Given the profile of the Australian program in the global context of IFV programs, a decision not to bid would be a tacit admission that the vehicle had reached its life of type, something the company is keen to avoid ADM suspects.
General Dynamics Land Systems – Australia
GDLS-A is offering a solution based upon the Ajax IFV developed by GDLS-UK for the British Army (formerly known as Scout). The Ajax is a development of the ASCOD armoured fighting vehicle used by the Spanish and Austrian armed forces. The company, which had an engineering varant on show at Land Forces, confirmed in early February that it had responded to the RFT.
“We have submitted a compelling Ajax-based offer for Land 400 Phase 3, which not only meets the customers’ key capability requirements but also offers a persuasive offer on the work that will be completed in Australia,” a GDLS-A spokesperson told ADM in a written statement. “We will reveal more details on our solution over the coming months.”
Hanwha Defense Australia Pty Ltd has also indicated that it will submit a response to the RFT, with a bid based upon the Redback Infantry Fighting Vehicle (IFV). At a glance, the Redback is able to carry three crew and eight dismounts and will include the EOS 30mm turret and Remote Weapon Station, Elbit BMS with Spike missile and Iron Fist Light Decoupled active protection system – a configuration that Hanwha says presents no issues in terms of systems integration for them. Hanwha acknowledges that integration challenges, particularly in C4I systems, is a known concern for Army. Their approach was to derisk this through a close collaboration with Elbit which would focus heavily on the integration of these systems.
“At the present stage Hanwha intends to submit a response to the Land 400 Phase 3 RFT (and) our proposed solution will be the Redback,” Richard Cho, Managing Director of Hanwha Defense Australia, said to ADM.
The Redback aims to bring together the best of the technologies behind the K9 self-propelled howitzer (Hanwha bought Samsung Techwin, the K9 OEM, in December 2014) and K21 vehicles, the backbone of the Republic of South Korean Army. Hanwha’s full Land Combat capability portfolio has manufactured, integrated and sold thousands AFVs currently in service between South Korea, Norway, Estonia, India, Turkey, Poland, Finland and other countries.
The industry and capability story of the K9 in Europe has parallels with what Hanwha is hoping to achieve in Australia should it be successful on Land 400 Phase 3.
“Norway required a 100 per cent offset for their K9 program, to be delivered over the decade in a staged way,” Cho said. “We expect around 40 per cent offsets can be achieved in the first few years, well ahead of schedule. The combined training, production, warehousing and sustainment between these close neighbours of Norway, Finland and Estonia saw a coherent, successful technology transfer program between South Korea and Europe.”
Cho points out that most of crucial components in the Redback have been in service with these customers for the better part of two decades, with South Korea able to provide a comprehensive suite of ILS performance datasets.
Hanwha is looking forward to being able to show off the capability of the Redback should it be successful in being selected for RMA. Vehicle highlights are:
- STANAG 6 for Kinetic protection
- STANAG 4A/4B for Mineblast protection with the same mine resistant seating system as on the Hawkei PMV
- Integrated Iron Fist Active Protection System
- Proven running gear and engine system from the 48 tonne K9 SPH to maximise growth potential and allow commonality of support with Abrams Main Battle Tank
- 30mm ATK main armament capable of firing the full suite of US munitions fitted to an EOS turret incorporating the same user interface common to the Hawkei and Bushmaster RWS interface.
- UAS and counter-UAS capable
- Integrated with Elbit BMS and Iron Vision ‘See through armour’ technology allowing full 360 degree uninterrupted field of vision around the vehicle with Heads Up Display. This allows BMS overlay and slewing of the armament to the users head movements; similar to what is commonly seen in attack aviation and fighter aircraft.
- Seating for eight dismounts in mine resistant seating.
- Approximately 42 tonnes at combat weight.
“We’ve been talking extensively to Australian industry about how our bid would involve true technology transfer,” Cho confirmed, highlighting Penske Power Systems for the MTU engine and Alison transmission support.
The company aims to set up its industrial base in Geelong, leveraging off the regional focus on defence vehicles already in place in Defence. Hanwha would transfer the ability for testing of the engine and transmission of the Redback to Australia, technology that could also be used to support the Abrams fleet, which shares similar technologies.
The potential move sees the company diversify its own industrial base and supply chain, a key element of the geo strategic hedging strategy for South Korea as a whole. Sending materiel between South Korea and US (45 days at sea) or Europe (60 days at sea) vs the 20 day at sea for Australian deliveries is a driver of behaviours for South Korea as well. Given the geopolitical tensions in the region, South Korea is looking to make the most of the regional connection to Australia based on geography as well.
The next generation of IFVs for South Korea is also under consideration at this time to analyse future potential requirements for approximately 1,000 IFVs. There is a good chance that the Land 400 specs will be similar to those, with Hanwha looking to exploit the commonality and economies of scale between the two nations and offer up the Redback solution comprising Australianised Industry support to the Korean Army.
On the other side of the ledger PSM, which had originally proposed the Puma IFV, decided not to pursue the Phase 3 RFT last November, due to what it said was Army’s “explicit” preference for a manned turret. The Puma vehicle has an unmanned turret, which PSM says saves weight and allows protection levels to potentially be increased as a result.
“PSM has decided, along with the parent companies (KMW and Rheinmetall), not to participate in the tender,” Mathias Kraus, the company’s head of sales and marketing, said. “The main reason was the explicitly expressed preference for a manned turret. The Australian Army has stated that vehicles featuring unmanned turrets will most likely be unsuccessful.
“PSM is not prepared to forego the advantages of an unmanned turret and the highest possible protection level for the entire crew by integrating a manned turret to meet a key requirement of the Australian Army.”
Rheinmetall intends to respond to the RFT with a solution based on the Lynx KF41 IFV, the design, development and manufacture of which the company says will be undertaken in Australia. It says this will leverage the Military Vehicle Centre of Excellence it has established near Ipswich to produce the Boxer CRV, together with an industrial network of SMEs across Australia.
“Rheinmetall has developed this (Lynx) vehicle so it is positioned at an ideal level of maturity when Australia needs it to enter service in 2026 and will have the growth path to extend these capabilities throughout its 40-year life,” a Rheinmetall spokesperson said in a prepared response to ADM.
“Rheinmetall’s partnership with Army and the Commonwealth to deliver the Boxer for Phase 2 represents the opportunity to develop and deliver a complete armoured fighting vehicle force for the ADF.
“We have taken all the significant benefits of Boxer and ensured they are part of the Lynx KF41 package. Design, development and manufacture of the LYNX in Australia for the Australian Defence Force will also build on the advanced manufacturing jobs at our new military vehicle centre of excellence being built at Ipswich in Queensland, as well as a strong industrial network of SMEs across Australia.”
Following the closure of the RFT, Defence is undertaking a three-stage evaluation of the contenders, the first of which will be a detailed evaluation between now and the third quarter of 2019 to select a shortlist of tenderers to proceed to the next stage.
The second stage is the Risk Mitigation Activity with a 12-month vehicle mobilisation period prior to the commencement of the test and evaluation period, as described earlier.
“Concurrent activities and workshops will also be undertaken in order to clarify and refine the offers to mitigate risk to the Commonwealth (and) Stage 2 is anticipated to conclude around the end of 2021,” Defence says. “The project will then undertake the Stage 3 final evaluation and down-selection of a preferred tenderer.”
The current timeline will see the Land 400 Phase 3 project return to Government for consideration in 2022.
This article first appeared in the March 2019 edition of ADM.