Anger as MoD hands £1bn Army truck contract to German supplier

The Ministry of Defence awarded a £1bn truck order to a German company yesterday in preference to a rival consortium involving the Birmingham-based commercial vehicle maker LDV.

The Ministry of Defence awarded a £1bn truck order to a German company yesterday in preference to a rival consortium involving the Birmingham-based commercial vehicle maker LDV.

MAN ERF has been selected to supply the Army with 5,000 support vehicles ahead of the LDV consortium and a third bidder, the US truck manufacturer Oshkosh, which had pledged to carry out 90 per cent of the work in the UK, creating 600 jobs at its Llantrisant site in South Wales.

The vehicles will be built in Austria and sent to the UK for final assembly at Marshall Special Vehicles in Cambridge as part of what is the biggest UK military truck order in the past 25 years. A follow-on order for a further 2,000 trucks is expected.

The LDV consortium had been given strong backing from the trade unions on the grounds that it would create more jobs and give the UK a strategic military truck manufacturingcapability once again. Although the LDV consortium would have been led by the US military truck maker Stewart Stevenson, the vehicles would have been built in Birmingham and the programme would have provided work for 140 other UK suppliers, including the two other UK partners in the consortium, Lex Defence and Multidrive, which is based in Thirsk.

A spokesman for MAN ERF maintained that the contract would create "hundreds"of jobs directly at its Middlewich plant in Cheshire and among its 15 UK-based subcontractors. But he conceded that only 50 per cent of the order would be carried out in this country and the rest in Austria.

The contract has been the subject of a fierce tussle between the three bidders, and at one stage it looked as if Oshkosh was likely to win the contest. The Oshkosh chairman, Robert Bohn, said the loss of the programme was "disappointing", claiming that it had submitted a bid which was superior in terms of vehicle performance, value for money and through-life fleet support.

Tony Woodley, the general secretary of the Transport and General Workers Union, said he was disappointed that the LDV bid had failed. LDV also said it regretted that the MoD had missed a "major opportunity" to recreate a strategic truck-making capacity in the UK, missing since the late 1980s when Leyland disappeared.

However, the Defence Procurement Minister, Lord Bach of Lutterworth, maintained that the choice of MAN ERF was consistent with the Government's defence industrial policy, adding that the contract would provide value for money for the taxpayer.

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