Geelong armour decision on hold

A REVIEW into the Australian Defence Force will prolong a wait for a decision about whether a multi-billion-dollar military manufacturing deal will be delivered at Geelong.

Defence Industry Minister Pat Conroy said the federal government would not award a contract for the Land 400 Phase 3 Infantry Fighting Vehicle project – worth between $18 billion and $27 billion – until it considered the findings of a Defence Strategic Review initiated earlier this year.

Hanwha Defense Australia, a subsidiary of South Korean company Hanwha Corporation, is one of the two candidates vying for the tender alongside German-linked Rheinmetall Defence Australia.

The two candidates were announced as the lead contenders in September 2019.

Hanwha has indicated it would base its building site at its Armoured Vehicle Centre of Excellence now under construction at Avalon Airport.

The contract is to build up to 450 military vehicles to replace the existing armoured personnel carriers that have been in service since the 1960s.

Hanwha secured a $1 billion Land 8116 Phase 1 contract in December last year to build self-propelled howitzers and support vehicles.

Mr Conroy said delaying the decision would allow the government to make an informed decision on the contract.

“I would like to thank Hanwha Defense Australia, Rheinmetall Defence Australia and the many other companies involved in this tender process for their understanding and professionalism.

“The government remains focused on Australia’s future defence capability. We don’t want to pre-empt the findings of the Review, which is especially critical given the rapidly changing strategic circumstances facing our nation.”

Former defence minister Professor Stephen Smith and former chief of the defence force Sir Angus Houston are in charge of the Defence Strategic Review. Submissions closed on November 30, and the independent leads are due to present their findings to the federal government early next year.

The review is aimed at delivering “a holistic consideration of Australia’s Defence force structure and posture” including the ADF’s preparedness, strategy and investment programs.