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RTD Focuses on Middle East for Vehicle Export Deals

February 10, 2016 (Photo Credit: Eric Piermont/AFP via Getty Images)

PARIS — Renault Trucks Defense saw a buoyant year of exports in 2015 and expects deals with Kuwait and Egypt to further boost sales of light-armored vehicles and troop carriers in 2016, chairman Emmanuel Levarcher said. 

RTD, which includes the Panhard builder of light vehicles, is a unit of the Swedish Volvo commercial truck company.

The French company is marking this year the centenary of design of the Renault FT-17 tank, used by the French Army to break the German offensive in July 1918 in World War I.

Kuwait last year ordered 120 Sherpa Scouts. RTD is in detailed negotiations for further sales of the light vehicle and the véhicule avant blindé Mark 3 troop carrier, Levarcher told the defense committee of the National Assembly on Jan. 27.

“I cannot give you all the details of current export orders,” he said. “(In 2015) we signed a contract for 120 Sherpa Scouts with the Kuwait national guard, and we are negotiating other contracts … for significant numbers of Sherpa but also the VAB Mark 3.”

There are agreements in principle and the talks are on the right track, he said.

“I hope to give you the results in a few weeks. We are confident,” Levarcher said.

RTD is in negotiations with Egypt to supply trucks, as well as light- and medium-armored vehicles, he said. The company has already delivered more than 1,500 trucks to the Egyptian forces.

The company has just signed a contract with ODAS to deliver some 100 VAB Mark2 to Lebanon, he said. ODAS is the state-backed organization for French arms sales to Saudi Arabia. The Lebanese services are acquiring French arms in a program financially backed by Saudi Arabia.

“2015 was a buoyant year, and the year to come looks to be very promising in terms of contracts,” Levarcher said. RTD over the last five years boosted exports to half of sales from a fifth, and the company plans to further increase foreign sales.

RTD last year won through its U.S. Mack Defense unit a Canadian tender worth more than €500 million (US $570 million), he said. The deal is to supply more than 1,500 trucks to the Canadian Army, with delivery due between mid-2017 and the end of 2018. Canada holds an option for a further 600 units.

An order from US Africa Command for Bastion troop carriers for African nations will maintain jobs at the ACMAT unit at Saint-Nazaire, northern France, he said.

The RAID and GIGN, respectively a French elite police unit and a gendarme paramilitary force, have ordered “a few” armored vehicles, which are to be delivered in March or April ahead of the Euro 2016 soccer competition, he said.

RTD is building the first 25 units of a heavy vehicle for French special forces, and these are due be delivered by the end of the year, he said. That vehicle is part of a December order for 440 vehicles for the special forces, comprising 241 light and 202 heavy vehicles.

RTD also sees prospective sales in central Europe, he said. The company works with a Czech partner, Tatra, when the need arose.

Asked whether Volvo had access to confidential data, Levarcher said RTD had its dedicated servers to ensure sensitive information did not leave France.

Asked whether Volvo constrained foreign sales, Levarcher said: “Since I have been the head of RTD, there has not been a single decision from the group which would have blocked or slowed our export activities.

“Our results show that. We have signed contracts with countries like Kuwait, Lebanon and several African countries.”

There was no imposition of Swedish regulatory constraints and the group’s main concern was “to ensure that no decision should be taken which would bring excessive risk in terms of image.

“This is a concern shared by the French government, as I have noticed in the handling of certain files,” he said. “The Volvo group has never prevented us from exporting material."

As the Ukraine crisis unfolded in 2014, RTD froze talks with a prospective partner, Russian company UralVagonZavod, to develop a 30-ton infantry fighting vehicle named Atom, as the company waited for instructions from Sweden and France.

The new Volvo chairman, Martin Lundstedt, speaks French and lived in France when he was head of the Scania truck company, in Angers, western France, Levarcher said. Lundstedt had sold Scania trucks to the Direction Générale de l’Armement procurement office and understood the French military market.  

He said there were no communication problems.

"We understand each other perfectly, and we can advance our business in full transparency,” Levarcher said.

Levarcher added that there was no reason to worry about differences between Sweden and France. RTD ruled out growth by acquisition, plans to grow on organic sales and will cooperate with partners according to need, he said. The company expects to double annual sales by 2018 or 2019, based on its orderbook.

The company will stay with its three regional bases, working through Mack Defense for the north American market, Sweden for northern Europe and Mack in Australia, he said. Poland is investing in the services, along with the Baltic nations, Finland, Norway, Sweden and central Europe.

On the KANT joint venture between Krauss-Maffei Wegmann and Nexter, he said: “It will be a long process and doubtlessly difficult as there is not a restructuring program. We do not have a project to join this alliance.”

Levarcher took up the chairman’s post in June. The company had 2015 sales of €500 million and employs more than 1,200 staff, mostly in France, he said. RTD is part of the Volvo group government sales unit.

 

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