General Dynamics wins £6bn contract from MoD

General Dynamics has won the first contract granted under the Ministry of Defence's largest ever procurement programme. The deal to provide up to 3,000 armoured utility vehicles could be worth up to £6bn to the American arms group. It falls under the MoD's Future Rapid Effect System (FRES) programme, which seeks to outsource an array of military vehicles to private companies, which will build, outfit and maintain the vehicles over the life of their usage. The scheme was originally expected to be worth up to £16bn, though industry sources expect it to be cut by up to a third due to budget constraints.

BAE Systems, General Dynamics, and the team of Boeing and Thales are among the bidders for the integrator role, overseeing outfitting of the vehicles with technology and weapons as well as their ongoing maintenance. BAE and GD are also competing for the contract to provide between 300 and 600 reconnaissance vehicles. Other vehicle categories have yet to be put up for auction and industry sources fear they could be scrapped altogether.