U.K. May Delay Major Vehicle Buy

An Armored Scout Specialist Vehicle, being built by General Dynamics UK for the British Army.(General Dynamics UK)

May. 26, 2012 By ANDREW CHUTER Defense News

LONDON — The fielding of the British Army’s new generation of medium-weight armored scout vehicles could be pushed back five years to 2020 amid budget cuts in the Ministry of Defence’s equipment plan.

The 500 million pound ($784 million) demonstration phase being undertaken by General Dynamics UK to provide a family of tracked Scout and other specialist vehicles could be extended and the fielding of the vehicle pushed back, one MoD source said.

A second source said the Army was “looking at its options and while the issue had not been finally settled, it was likely the vehicles would not enter service until 2020.”

International observers will likely track the possible delay since the Scout Specialist Vehicle (SV) was already generating interest in the export market. A recent Ernst & Young study estimated the potential export value of the program at more than 1.3 billion pounds over a 16-year period.

The MoD has never publicly acknowledged the expected in-service date for the Scout vehicle, although Army officers at last year’s DSEi exhibition in London said it was 2015.

The number of vehicles eventually purchased could also be cut. That’s a reflection of continuing budget pressures and the fact the Army is facing a heavy downsizing as part of a restructuring plan.

Details of the restructuring, known as Army 2020, and a tri-service reorganization and expansion of the reserves are expected to be rolled out before the government goes into summer recess in July.

A MoD spokeswoman said: “The Defence Secretary [Philip Hammond] made clear in his announcement earlier this month that the MoD will spend 5.5 billion [pounds] over the next 10 years on an armored vehicle program for the Army. That includes the Scout specialist vehicle, which is well into its demonstration phase.”

“The funding for the vehicle pipeline, which also includes the Warrior Capability Sustainment Program, a utility vehicle and improvements to Challenger 2, will be prioritized, according to the Army’s requirements. In the case of Scout, production numbers and delivery dates will be confirmed at Main Gate,” referring to the U.K.’s production decision.

A spokesman for General Dynamics said he was unable to comment on the issue.

General Dynamics secured the demonstration deal for the Scout SV program in 2010. A new Scout vehicle to replace the aging Combat Vehicle Reconnaissance (Tracked) platform is the priority, but the company is also building infantry carrier, recovery and repair demonstrators as well as a base platform version of the Austrian-Spanish Cooperation Development SV machine on which the family will be based.

The Scout vehicle was part of the 5.5 billion pound armored vehicle program given a green light to continue when Hammond announced the MoD had balanced its equipment program budget for the next decade after years of overspending.

The MoD named General Dynamics SV program and Lockheed Martin’s 1 billion pound upgrade of the Army’s Warrior infantry fighting vehicle among the big-ticket items across the armed services that had been funded in the 10-year equipment budget plan.

At the time, Hammond declined to specify what programs or capabilities had been dropped or delayed to achieve the final round of budget cuts proposed as part of the Planning Round 2012 process.

The victims of the latest round of cuts are starting to become apparent. Last week, it emerged that the MoD had axed the 500 million pound plan to equip Royal Navy Type 45 destroyers and Type 26 frigates with the Cooperative Engagement Capability used by the U.S.

The life-extension program for the Challenger 2 main battle tank is expected around 2018 and the new utility vehicle to replace the Bulldog armored personnel carrier by around 2022. A second phase of the specialist vehicles requirement may also be involved.

Last year, General Dynamics UK caused a furor when managing director Sandy Wilson told reporters the program could be delayed or axed.

At the time, the specialist vehicle program, like many others, was under scrutiny at the MoD as it grappled with balancing its books in the face of a 7.5 percent budget cut and a 38 billion pound black hole in unfunded commitments over the next 10 years left by the previous Labour administration.

All three services have suffered significant capability losses imposed since the strategic defense and security review of 2010 took out tanks, artillery, warships, fast jets and large numbers of military and civilian personnel to reduce spending.

A significant delay to the Scout and other variants involved in what is known as Recce Block 1 could result in the other specialist vehicle variants being considered for manufacture in Recce Block 2 — the ambulance, command-and-control and engineering-reconnaissance variants.

The SV program was originally part of the MoD’s Future Rapid Effects System project, which also encompassed an eight-wheel-drive utility vehicle, primarily as a troop carrier.

General Dynamics won that deal, too, with its Piranha V vehicle, before the MoD axed the program.

The MoD source said the current plans envision fielding a utility vehicle in the 2022 time frame.

Part of the requirement for a highly protected troop carrier was taken up by an urgent operational-requirement purchase of the Force Protection Mastiff MRAP and other vehicles for use in Iraq and Afghanistan.

The Army has been working for months on deciding which of the numerous fleet types purchased by the government as urgent operational requirements will be taken into the core vehicle program as the British withdraw combat troops by the end of 2014.

Defense ministers have already said Force Protection’s new Foxhound lightweight protected vehicle, which is now being delivered to Afghanistan, will be taken into the core program.

Analysts here believe the Mastiff, the British customized version of the Cougar, is also a likely candidate to become part of the core equipment program.