THE economy has received a major boost after the Ministry of Defence awarded a £6bn contract for a new generation of rapid response military vehicles to a Welsh-based company.
US-owned General Dynamics which employs 1,000 in South Wales, mainly at Oakdale and Newbridge, was last night named as the preferred bidder for the its called Piranha V vehicle, which will replaced the Army’s Saxon and FV430 rapid response battlefield transportation fighting vehicles.
Piranha V is the first to be selected for the MoD’s future rapid effect system (FRES) utility vehicles.
General Dynamics said it could not at this stage give any clear indication of new jobs being creating in South Wales, but it is likely to be significant.
Two more FRES contracts, both worth around £6bn have yet to be awarded, which General Dynamics are also in the running for. If secured they would be another major boost to the Welsh defence sector and go some way to address the over servicing of the South East of England for MoD outsourced contracts.
Yesterday’s announcement follows last year’s decision by the UK Government to award a multi-billion pound armed services training facility contract at St Athan in the Vale of Glamorgan to the Metrix consortium.
General Dynamics has been operational in South Wales since 2001, when it won a contract to supply the MoD with a new state of the art battlefield communication system known as Bowman.
Making the announcement yesterday Baroness Ann Taylor, Minister for Defence Equipment and Support, said: “The FRES vehicle programme will be a major investment in the future of our Armed Forces. I am pleased to announce the provisional selection of Piranah 5 as the preferred design and I look forward to working with General Dynamics UK during the next stage of the programme.
"FRES is a long term programme to be delivered in stages to meet the Army's needs over the next 30 years. This announcement marks an important milestone."
General Sir Richard Dannatt, Chief of the General Staff, said: "The provisional selection of PiranhaV as the FRES utility vehicle design heralds the start of a new era for the Army in terms of capability. It maintains the progress of the FRES programme which is at the heart of the British Army's equipment programme and is my highest priority after support to operations. This will form the backbone of the Army's future armoured vehicle requirements.
The selection of General Dynamics was last night weelcomed by First Minister Rhodri Morgan.
He said: “I am delighted that General Dynamics, one of the top six defence companies in the world, with a significant centre of excellence at Oakdale and Newbridge, has been selected by the MoD as the preferred bidder.
“The company currently employs around 67,000 people worldwide, and this announcement will not only help safeguard the future of the highly skilled employees at the company's state-of-the-art facilities in Wales, but sends a clear message that Wales has the skills and the infrastructure to produce high quality and internationally competitive products.
“I would like to pay tribute to the local management and employees at the company's headquarters in Wales on being selected as preferred bidder for this prestigious contract.
“Once again it demonstrates that Wales is setting the pace in terms of competing for, and winning business against the best in the world. "
Dr Sandy Wilson, president and managing director of General Dynamics said: “We are delighted that Piranha V is the British Army's choice for the FRES utility vehicle.
“ With over 9,000 Piranha’s already in service, the family's pedigree speaks for itself. We have continued development work at our own initiative, and we will work closely with the MoD to de-risk the programme.”