MORE FRES DEVELOPMENTS – THE SCRAMBLE BEGINS
By Julian Nettlefold, Editor, BATTLESPACE
04 Sep 07. As DSEI approaches the main FRES protagonists are dusting off their power point presentations to make the required splash during DSEI. On surprising fact was a quote from one U.S. major a ta recent press briefing that a Statement in Parliament had quoted FRES as being worth £100bn over 40 years, the most valuable defence contract in the world! Perhaps the rush can now be explained!
This Statement is in stark contrast to the guarded comments made by Lord Drayson at the recent Bovingdon demo where he would not quote a contract value or also reduced the numbers to 3000. BAE has long quoted a figure of £15bn as being set in stone but again this does not stand scrutiny. Have you picked up anything on MoD extending the FRES AP phase into a stage 2? Sources suggest that the process will be extended and that the IPT is aiming to issue contracts this month to Thales/Selex, GD and possibly one other and these may initially be study contracts that run through to next April.
On BATTLESPACE estimations the first and possibly only tranche of Utility Vehicles totalling 120 would be worth £800,000 each thus some £96m including equipment plus a 40 year Through Life three times that, say £288m; 120 Recce vehicles at say £1m a pop, £120m, plus a 40 year Through Life three times that, say £360m; various other variants such as mobile guns etc say 300 vehicles at £800,000 each thus £240m plus a 40 year Through Life three times that, say £720m gives a total contract value over a Through Life of £18.24bn. What the Government appears to have done is to include the legacy fleet including the 800 or so 430 vehicles which is debatable as to who would manage these. Under the DIS BAE was slated to manage the whole Armoured vehicle fleet but some say this wa sonly the legacy fleet excluding FRES vehicles. Whilst the FRES Teams understand that if they win FRES this will include the legacy fleet with the IPT only indicating that it will be the FRES. The Through Life Support of the legacy fleet plus FRES would be worth a lot of money over 40 years but £100bn is pushing it. Like the Leyland DAF 4 tonne win where Leyland DAF was promised 30000 like-for-like Leyland DAF 4 tonnes to replace all the Bedfords, the company eventually scarped just over 6000 with the MoD placing an order for 2000 Bedfords and refurbishing a large part of the fleet after the DAF order was signed, thus causing the eventual demise of the company and the requirement by the MoD to pay far more per vehicle.
Last week we heard that both Lockheed and Boeing were gearing up to establish, in Boeing’s case, a facility in the South with Lockheed announcing the expansion of its Insys facility. (See: BATTLESPACE UPDATE Vol.9 ISSUE 33, 17 Aug 2007, Lockheed Martin UK INSYS new high-tech manufacturing centre). Defense News reported this week that BAE Systems was going to spend £40m at its Newcastle Plant or close it if FRES is not won. This is a surprise move and at last gives back to the taxpayer some of the 3100m earned through UORs into the UK rather than pushing it over the Atlantic.
Andrew Chuter of Defense News reported that if BAE Systems is not awarded a leading role in FRES, company officials say, the firm might close its armored-vehicle factory in this northern England city — the country’s only such manufacturing plant. The warning was one of the opening shots of what is set to be a fierce contest to secure the key integrator role for some 2,000 utility vehicles being purchased as the first part of the FRES requirement. (It would take a whole page to give you links to BATTLESPACE reporting on this!)
It was delivered Aug. 30 by Andrew Davies, managing director of BAE Land
Systems, and other company executives, who were telling reporters about their plans to win the contract to build and support a program intended to be a cornerstone of Britain’s armored capabilities for a