Three French companies are discussing a bid to replace the AMX 10RC and other French armored vehicles. (Wikipedia)
PARIS — Systems specialist Thales has entered talks with armored vehicle builders Nexter and Renault Trucks Defense (RTD) as the three French companies seek to make a joint offer to build a new multirole combat vehicle and light tank that could be worth about €4 billion (US $5.5 billion), industry executives said.
The talks come as the Direction Générale de l’Armement (DGA), the French government’s arms procurement office, has launched a tender restricted to the three companies for 2,080 units of the Véhicule Blindé Multirole and 248 of the light tank, Engin Blindé de Reconnaissance et Combat, business daily Les Echos reported.
“The DGA has launched the tender for manufacture of 2,300 armored vehicles to replace the VAB [Véhicule de l’Avant Blindé], Sagaie and AMX 10RC, which are folding under the weight of years,” the newspaper said. “The deal is worth more than €2 billion.”
An industry executive said a figure of about €4 billion is a realistic estimate.
Nexter and RTD had signed an agreement on bidding to build the multirole vehicle and are continuing talks after the pact ended in December, a second executive said.
Thales has joined the talks, the executive said.
The three also would work on the light tank to try to lock up the French market.
Thales specializes in command, control, communications and information networks, while Nexter and RTD build vehicles.
A target €1 million unit price for the multirole combat vehicle includes only the platform, omitting onboard electronics and systems. Once those are included, €1.5 million iss closer to the real figure, the executive said.
Based on that latter estimate, the combat vehicles would cost €3.12 billion, excluding a 20 percent sales tax.
A second executive said the unit price for the light tank is estimated at €4 million to €4.5 million, totaling up to €1.1 billion, excluding sales tax.
That price reflects a sophisticated electronic turret, a 40mm gun and missiles. The two programs would cost an estimated total of €4.2 billion.
An Army spokesman said of the planned 2,080 combat vehicles, 1,722 would be a light version and 358 heavy.
A limited competition for the armor programs is seen as valid under Article 346 of the European single market pact, which allows a domestic tender if essential security interests are concerned.
Spokesmen for the DGA, Nexter, RTD and Thales declined to comment.
A lack of British and German open international tenders for armored vehicles is seen as the background to the French, domestic-only approach.
“This is extremely sensitive,” the executive said. A strategic interest allows a waiver of the foreign tender required under the European single market, the executive said.
The French Army expects to receive the first 24 multirole vehicles in 2018 and the first four light tanks in 2020, Army chief Gen. Bertrand Ract-Madoux told the French parliament’s defense select committee Oct. 16.
The vehicles are part of the Scorpion land systems modernization program, which the Army expects to launch this year, Ract-Madoux said.
The program launch has been delayed by two years and the budget has been halved, he said.
Separately, the arms procurement office has awarded Thales a contract for a strategic study to define the overall system architecture for the armed forces’ network-centric operations in 2020-’25, the company said in a Jan. 29 statement. ■