Feds sign $2B contract with General Dynamics
A $2-billion dollar contract for new armoured vehicles was quietly signed with General Dynamics Land Systems earlier this month.
The Liberal government originally announced Aug. 18 that negotiations were underway for the sole source deal to purchase 360 combat support Light Armoured Vehicles from General Dynamics Land Systems-canada in London, Ont.
A notice on the federal government’s procurement website noted that Public Services and Procurement Canada, on behalf of National Defence, awarded the contract to General Dynamics valued at $2 billion on Sept. 5. That cost includes initial spare parts, technical manuals and training.
Public Services and Procurement Canada did not issue a news release about the major award. The department did not respond to a request for comment.
The overall project is estimated to cost $3 billion but that includes in-service support, construction of new facilities and other support to the program.
The combat support Light Armoured Vehicles was originally announced by the Liberal government with an estimated cost between $500 million and $1.5 billion. The plan was to award the contract in 2023 after a competition between defence firms.
But with the federal election looming the deal was fasttracked by the Liberals, joining a series of recent defence-related funding announcements. A competition was jettisoned, replaced with a sole-source deal with General Dynamics.
The deal includes a $650 million repayable loan to General Dynamics. Details have not been released.
General Dynamics will provide the new vehicles in eight variants. They will be used as ambulances and in other roles such as vehicle recovery, engineering, mobile repair, electronic warfare and as command posts. The current fleet of armoured support vehicles is comprised of the LAV II Bison and the M113 tracked vehicle.
The DND stated the contract was sole-sourced to General Dynamics as the firm builds most other armoured vehicles for the Canadian Forces and having a vehicle based on the same chassis allows for savings in maintenance and training.