International Armoured Vehicles Market 2013 2023(1)

International Armoured Vehicle Market Report 2013 - 2023

Contents

03 About the research 05 A changing threat landscape in an uncertain future 09 Key investment areas 12 Exaggerated threats 13 Global growth markets pivot towards Asia, Middle East 19 Global armoured vehicle programme requirements 24 Cutbacks threaten key design developments 29 Goodbye MBT. Hello UGV? 31 International Armoured Vehicles 2013 32 About Defence IQ 33 Disclaimer

This report will explore how the future of the global armoured vehicle market is likely to evolve during the period 2013 - 2023. The report is based on a survey of 190 senior executives and professionals within the armoured vehicle domain, which includes commercial and military (currently serving and retired) respondents. The analysis of the survey data has been supplemented with proprietary interviews and desktop research. Topics examined include; the key emerging global markets, global procurement requirements, the key challenges facing armoured vehicle manufacturers over the next decade, armoured vehicle design requirements, and the enduring impact of the economic crisis.

The majority of survey respondents (51%) were drawn from the commercial sector, although a number of participants classified in the other section could also fall within this category. Looking at Figure 1, others formed a healthy part of the overall total accounting for 23% of respondents, with most in this group identifying themselves as consultants, educators, or government officials. Military respondents accounted for 22% of all respondents, with 12% of those currently serving and 10% retired. Individuals from the defence media accounted for the remaining 4% of respondents.

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About the research

International Armoured Vehicles FIVE, Farnborough, UK 5 8 February 2013

51%

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23%

Figure 1 Overview of respondent by industry role

Commercial (vendor) Military (currently serving) Military (retired) Media Other

Figure 2 demonstrates that this year saw wider global representation than the 2012 survey with respondents garnered from 38 countries across every continent. This year respondents based in the UK made up 19% of the total compared to last years 28%, indicating that the 2013 survey data is drawn from a more balanced and representative group. The response rate from India was robust (8%) while other nations such South Africa (4%), Turkey (3%), UAE (3%), Australia (3%) and Canada (3%) were also well represented.

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Figure 2 Overview of respondent by nationality

UK

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In Afghanistan, there were about 400 IED attacks a month in 2008. By 2010 this tripled to more than 1,300, according to the Pentagons Joint Improvised Explosive Device Defeat Organization (JIEDDO). During 2011, the total number reported was 16,554. Figure 3 highlights that 85% of survey respondents consider the Improvised Explosive Device (IED) to be the critical threat to protect against over the next decade. However, the data in Figure 4, which is taken from last years Armoured Vehicle report, indicates that this threat has marginally decreased over the last 12 months at the time 89% identified the IED as the key threat.

Is the IED really less of a threat now than it was a year ago? In one sense, yes. In October Lt. Gen. Adrian Bradshaw, deputy commander of the International Security Assistance Force (ISAF), said that the cost of the previously inexpensive explosive materials has spiralled over the last 12 months. An IED that last year cost insurgents $200 will now cost between $600 and $800 to build. This is indicative of a shortage of material, Bradshaw said.

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A changing threat landscape in an uncertain future


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CBRN (Chemical Biological Radiological Nuclear)

Small arms ballistic attack (up to and including 7.62mm)

HMG ballistic attack (above 7.62mm)

Blast / IEDs

Directed energy systems attack

RPG

Unfamiliar and difficult terrain / climate

Other

Figure 3 Analysis of key future threats

As the cost of IEDs has increased four fold, the number of attacks is reported to have fallen by a third. While the physical threat of IEDs continues to present a troubling problem for armoured vehicle manufacturers, the mere fact that there are fewer of them being planted now than 12 months ago means that the risk of encountering them has decreased, which accounts for the dip in Figure 3. Lt. Gen. Michael Barbero, director of JIEDDO has previously said that IEDs are easy to construct, lethal and accurate the cost differential [between making the devices and defeating them] is astounding, and we cannot sustain it. JIEDDO has always maintained that attacking and infiltrating the networks of the forces that procure, make and plant the IEDs is the most effective way of reducing their impact. Recent figures suggest that this assumption is built on solid foundations. As the planned withdrawal from Afghanistan in 2014 gets closer the questions and debate about future threats will inevitably start to become more intense. For some the fear of

focusing too heavily on IEDs is born out of the well-worn condition known as next-war-itus. In a recent poll Defence IQ readers were asked: Will the IED remain the number 1 battlefield threat over the next decade? In a result that surprised some, 64% said no. However, while the majority of those respondents surveyed indicated that the IED will not likely remain the top threat, this doesnt in any way mean that it wont remain a threat. The threat will endure, whether its the key threat or not Faced with the question about whether or not JIEDDO has a future beyond 2014, Lt. Gen. Barbero says: I always tell people thats the wrong question. The right question is is the IED, and the networks that employ them, here to stay? And they are. So if we have an enduring threat, do we require enduring capabilities? And that answer is obviously, yes.

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Blast / IEDs


RPG


Other

Figure 4 Analysis of key future threats

(data from 2012 survey for comparison purposes)

Clearly we do not know what the key threat will be in the future it will depend on the opposition tactics, the terrain, climate, resources, and to some extent the economy. Indeed the threat landscape in the 21st Century must be considered in isolation from that which came before it. According to defence analyst Louis DeAnda, military forces now face a Hybrid Threat which must be approached with a united front where networks of experts and authorities work together to pool information and share findings. The Hybrid Threat has created a unique challenge to the world and Western nations in particular, says DeAnda. Highly resistant to unilateral approaches, the Hybrid responds to any countermeasure by leveraging tactics, techniques, and procedures that defy traditional and conventional approaches that were useful in the last century. Highly persistent, each element of the Hybrid not merely serves to enhance the collective survivability, but acts as both a force multiplier and propagating force. No law enforcement approach will effectively counter it. No military approach will destroy it. Only a highly cohesive and focused approach will provide fast, tangible results. The Hybrid confronts us collectively across national borders and oceans, and it is beyond time for professionals in the military, intelligence, and law enforcement fields to meet with diplomats and statesmen to craft a new set of doctrine, strategy, and tactics to meet this rapidly developing transnational threat.


Everywhere in the future where there is fertiliser and the internet, we will always face IEDs Thats the main thing the IED is the threat that you have to handle; you have to be able to defeat the device and train your forces to go against the networks behind those IEDs. Major General Anders Brnnstrm, Chief of the Army Staff, Swedish Army

One of the more interesting disparities in the data from Figures 3 and 4 is the perception of CBRN (Chemical Biological Radiological Nuclear) attack as a more significant threat. In 2012, 15% of respondents indicated that CBRN should be considered a serious threat that armoured vehicles need to protect against post-Afghanistan. In 2013, the number of people indicating the same had doubled. Rather than indicating that the threat of CBRN has significantly increased over the last 12 months, the reality is more likely that the 30% figure is just a truer representation of its place in the contemporary battlefield. Syrias president Bashar al-Assad is known to have vast chemical weapon resources and recent newswires have reported that as the conflict in the region drags on he is more likely to use them against opposing forces. The threat from CBRN attacks should unquestionably remain at the forefront of industrys thinking in this field although counter-insurgency has been the principal form of conflict recently, it would be reckless to take the CBRN threat lightly. The threat of ballistic attack, from both small arms and heavy machine gun (HMG), has noticeably decreased from 2012. In each instance the number of respondents indicating it as a significant threat decreased 9% year-on-year. This could be as a result of a greater appreciation of the asymmetric threats that forces will likely face in the future IEDs, CBRN and RPGs. While ballistic protection will always be a mainstay for armoured vehicles, the capability to defeat more potent and unpredictable threats, such as IEDs, is seen to be a more pressing concern.


Consistent with the analysis of the data in Figure 3, the technologies that respondents believe will be granted the most significant levels of investment are counter-IED measures and blast protection systems. Almost 70% said that these systems will be favoured when Defence Ministries look to apportion budgets over the next few years (Figure 5).

The increasingly important on-board communication systems required to provide a networked capability came next with 40%. Perhaps in a sign of the times, maintenance, repair and overhaul (MRO) was the third highest investment area according to 39% of participants.

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Key investment areas


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Ballistic armoursystems

Blast armoursystems /

counter-IED

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Maintenance,repair and

overhaul (MRO)

Training andsimulation

pertaining toarmouredvehicles

Other

Figure 5 Overview of key investment areas

Not even a third of respondents believe that training and simulation technologies will receive robust government support over the next decade. This is surprising. Training aside, simulation certainly is becoming an increasingly important and reliable R&D process in the design of armour systems. A recent visit by Defence IQ to DuPont Protection Technologies in Geneva demonstrated just how far industry has come in developing software that is capable of accurately modelling and predicting the impact of ballistic projectiles on armour. The companys Finite Element Model (FEM) is starting to be used more and more on the vehicle manufacturing side, according to Carlos Sez Comet, development manager at DuPont. FEM takes much of the trial and error out of the early stages of armour development and as a result brings the cost down too. Using simulation technologies in this function will become increasingly common and necessary in the near future; it will inevitably attract greater investment. Furthermore, discussing blast modelling and simulation Jeff Mears, the manager of survivability engineering for Navistar Defense, says that simulation will be key and in the future will be the best approach used to protect vehicle occupants.

In line with likely investment priorities the key technology to improve the performance and survivability of armoured vehicles was active mine protection systems and other similar innovations to mitigate the effects of blast (Figure 6). A decade of operations in Afghanistan was the catalyst for rapid innovations in the protection of armoured vehicles from blast. The V-shaped hull, blast seats and sophisticated composite materials have all played a central role in up-armouring vehicles in the MRAP era. But now it is time for a new generation. Boutique blast firm ABBS is developing two active systems that work by essentially creating a downward force to counteract the mines upward force systems similar to this are what respondents believe will have the greatest impact on the industry over the next decade.

In fact, active protection in general was identified as the key trend for future armoured vehicle design, offering 360 protection from a variety of threats. Active protection systems (APS) such as Rafaels Trophy, which are designed to identify and intercept incoming projectiles, are seen to be critical AFV technologies according to 54% of respondents. There have been concerns that APS are not reliable enough and should never be used as the only means of protection in any combat zone, but that is not to say they arent a valuable addition to the armed forces arsenal. Used in conjunction with traditional armour, active protection systems can offer precious supplementary support and should not be ruled out as an important emerging technology. APS will not replace physical armour systems any time soon, but they would be a reassuring if not expensive addition to a vehicles overall system of protection.


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Figure 6 Analysis of technology expected to have the greatest impact,

2013 - 2023

Active Protection Systems (i.e. IronFist)

Interoperable communicationsystems

Modular ballistic armour systems

Active mine Protection Systems (orother innovations to mitigateblast)

Vehicle information integration

Other


Realistically, which threats do not need to be prioritised post-Afghanistan? Even though the CBRN threat was upgraded in Figure 3 from Figure 4, according to respondents it is still the most exaggerated battlefield threat (Figure 7). Thats not to say that the data in Figure 3 is misleading afterall there are five other threats considered to be more important but it does suggest that while CBRN needs to be a consideration, the threat should not be overstated. Perhaps events in Syria will be cause for a rethink on this issue the results from our 2014 industry survey on this same issue will certainly be telling. As expected, IEDs and RPGs are considered to be the least exaggerated threats.

Exaggerated threats

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Blast / IEDs


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Figure 7 Analysis of most exaggerated threats


Figure 8 gives an overview of the armoured vehicle hotspots over the next decade. India is again considered to be the most appealing global market according to 44% of respondents. However, Figure 9 shows that this has decreased significantly from the 57% that identified it as the key growth market last year. In 2012, India was an outright market leader but that gap has now closed. One potential reason for this could be the appointment of General Bikram Singh as the Indian Armys Chief of Staff in May. General Bikram has overturned key decisions made by his predecessor General VK Singh, which although seen by many to be a positive step towards increasing transparency and fairness in Indias notoriously bureaucratic procurement system in the long-term, it has led to uncertainty over a number of its current programmes. This includes the $10 billion Futuristic Infantry Combat Vehicle (FICV) contract, the Indian Armys largest active acquisition programme, which is aiming to procure 2,600 vehicles. General Bikram Singhs introduction has brought about vast change but it is yet to be seen what impact this will have on its armoured vehicle market.

Global growth markets pivot towards Asia, Middle East

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India

Saudi Arabia

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Figure 8 Overview of global markets with

greatest growth potential, 2013 - 2023


In his 2012 New Year message, Indian Prime Minister Dr. Manmohan Singh, said: Our Army, our Navy and our Air Force require modernisation and upgradation of personnel and systems. Ensuring this will remain my most important task as Prime Minister. Furthermore, in a recent address to delegates at an industry conference, Lt. Gen. (Rtd.) Dalip Bhardwaj, the former Director General of Mechanised Forces in the Indian Army, said: In India, the aerospace and defence market is growing at an unprecedented rate and is emerging as a key participant in the Asia-Pacific region. Its little wonder India is viewed as such a captive market: Earlier this year Stockholm International Peace Research Institute (SIPRI) announced that India was the world's largest arms importer, receiving 9% of the volume of international arms transfers during 20062010. At the time Siemon Wezeman of the SIPRI Arms Transfers Programme said: Indian imports of major conventional weapons are driven by a range of factors. The most often cited relate to rivalries with Pakistan and China as well as internal security challenges. As an importer, India is demanding offsets and transfers of technology to boost its own arms industry, and, in order to secure orders, major suppliers are agreeing to such demands. Lieutenant General J.P. Singh (Rtd.), former Deputy Chief of Staff for the Indian Army plainly told Defence IQ that the moment has arrived when India is on the threshold of economic and technological surge. Who would argue?

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India

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Other South Am

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Figure 9 Overview of global markets with

global growth potential (data from 2012 survey)

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As seen in Figure 8, Brazil saw a boost in support where 31% of respondents believe its market promises significant growth potential compared to 27% of respondents last year (Figure 9). Brazil is set to host the forthcoming 2014 World Cup and 2016 Olympics, which is likely to have impacted the perception of increased opportunities in the region. Earlier this year International Armoring Corporation (IAC), a U.S.-based manufacturer of commercial armoured vehicles, reported a 200% rise in demand from the UK due to increasing concerns about a terrorist attack during the 2012 Olympic Games. Following this trend, a more pronounced increase is probable in Brazil.

South Africa also saw a small jump with 17% indicating it as a key market. The African market is a difficult one clearly there is potential for growth but perhaps the 10 year focus of this report is too narrow to appreciate it. Speaking to Ivor Ichikowitz, the founder of South Africas Paramount Group, he believes the continent will eventually establish a self-sufficient and proud defence industrial base. My personal goal is to be able to grow a world-class, global defence and aerospace business out of Africa, Ichikowitz told Defence IQ. Im a great believer in the fact that no country or continent can emerge from a developing economy to a developed economy without a strong aerospace and defence industry. My goal is to prove that thats possible.

Protection can be offset by mobility. It is the mobility with which we can overcome the protection requirements we need to have light armoured vehicles with high power-to-weight ratios and high mobility, which is the only way I think we can achieve better protection. Brig. Gen. C.P. Mohanty, North Kivu Brigade Commander, MONUSCO Mission to the DRC, United Nations


Sweden and Norway languish towards the bottom of Figure 8, which is problematic considering the robust armoured vehicle market in the Nordic region. Norway is one of few (at least European) nations to be increasing its defence spend in 2013 following boosts to its petroleum profits. The surplus this created has allowed politicians to propose a 3% increase in military spending the 2013 defence expenditure is now forecast to be $7.3 billion. In addition, earlier this year the Norwegian government announced a 500 million deal to upgrade and manufacture 144 CV90 armoured combat vehicles from BAE Systems. This is one of the largest investments ever made in the Army, said Rear Admiral Morten Jacobsen of the Norwegian Defence Logistics Organisation (NDLO). Delivery will take place between 2015 and 2017, and forms an important part of our overall modernisation efforts and will provide the Armed Forces and the Army with the capabilities they need to carry out future operations both domestically and internationally. In parallel, Tommy Gustafsson-Rusk, the president of BAE Systems Land and Armaments division formerly known as Hgglunds, recently discussed the improving fortunes of the company saying that this year has seen a turnaround in the companys fortunes. The Swedish BvS10, Norwegian CV90 and U.K. Viking regeneration contracts will sustain us for several years. This year the company has signed off $916 million in major deals including those from Sweden, Norway and the UK.


The UKs growth potential marginally declined year-on-year with just 20% indicating that the British market represented good opportunities for the future. Even with recent programme announcements and the government setting aside 5.5 billion for armoured vehicle investment over the next decade, respondents are still not convinced. In November the UK MoD said it would buy another 51 Foxhound patrol vehicles at a cost of 46 million. This latest tranche of investment brings the total up to 340 million that the MoD has pumped into Foxhound since 2010. Aside from orders from the British Army, the government has high hopes for the patrol vehicles exportability and will be scouting for other potential buyers following its success in-theatre.

The UKs former Defence, Equipment and Support Minister Peter Luff said of the Foxhound: This is an amazingly agile piece of kit, with an engine which can be removed and replaced in just 30 minutes the soldiers I have spoken to are genuinely excited by it. The news came on the back of an update to the Warrior Capability and Sustainment Programme (WCSP) where Lt. Col. Howard Pritchard, senior requirements manager for the DE&S Combat Tracks Group, told Defence IQ that Warrior CSP is the Armys key priority. In October the Ministry of Defence announced that it was handing BAE Systems a 37 million contract to upgrade 99 Viking vehicles for use by the Royal Marines.


While only 22% indicated Turkey as an important growth region, Defence IQ believes the market is an exciting and dynamic one. Recently, Turkish Prime Minister Recep Tayyip Erdogan unveiled the countrys first indigenous armoured vehicle, the Altay Main Battle Tank (MBT). This was the first of four prototypes to be manufactured by Otokar in a $500 million joint venture deal with South Koreas Hyundai Rotem. The prototypes had originally been pencilled in for delivery in 2015 but Erdogan indicated that they would be delivered one or two years ahead of time. Furthermore, marking the first time a Turkish defence company had ever produced military vehicles abroad, Otokar announced in October that it was expanding its global manufacturing capability by establishing a base in Kazakhstan. The UAE market is also booming and this year saw the grand opening of the largest

armoured vehicle manufacturing space in the world. At a cost of $21.8 million, the Streit Groups 1.4 million sq ft facility is only half finished; by 2014 the company will complete a further two phases in the project with another $32.7 million investment. Streits chairman, Guerman Goutorov, told Defence IQ that his goal is to make the UAE a central hub for armoured vehicle manufacture. The UAE is a very well located country geographically you have access to Asia, Africa, Europe and the other Middle East countries youre connected to all the world, said Goutorov. His vision for the future is to create an armoured vehicle park at the Ras Al Khaimah facility by attracting suppliers to establish bases there. The facility in RAK will become a compound well save money on logistics and will work with other companies on a JV or partnership basis.

AFV design will change it already has changed as a result of our operations but the armoured battlefield I think is certainly here to stay. Lt. Col. Howard Pritchard, Senior Requirements Manager for the DE&S Combat Tracks Group, UK MoD

Global armoured vehicle programme requirements

This section of the report aims to give an overview of the latest global armoured vehicle programme requirements, procurement updates and potential business opportunities.

USA Upgrading 2300 MRAPs in Afghanistan with enhanced survivability retrofit kits. Plans to start building new Abrams tanks with ECP1 upgrades as of 2017. The Joint Light Tactical Vehicle (JLTV) programme is currently in contention between three manufacturers, with eventual plans to supply over 49,000 to the Army and 5,500 to the Marine Corps. Major focus remains on the long-gestating Ground Combat Vehicle (GCV) programme, following technology development contracts for BAE Systems Land & Armaments and General Dynamics Land Systems. Prototype trials scheduled for 2015. The US is also keen to reduce fuel consumption across the fleet, looking at options from green fuel cells to auxiliary power units, offering both a cost and operational advantage.

Brazil Following the demand for 2,044 VBTP-MR Guarani 6x6 APCs, the Brazilian Army has signed a $118.6 million deal with Iveco for the initial build and delivery of the first 86 units as large scale production is due for 2013. They will be equipped with Elbit unmanned turrets.

Colombia Currently on a drive to strengthen its armed forces, Colombia is investing in new IFVs in the hopes of finishing off weakened domestic terror/crime groups. Has a requirement for a new APC, and is understood to be in talks with IVECO for the 8x8 IFV VBM Freccia, shadowing Brazils recent procurement plan, as well as the US Stryker. Also has an additional requirement for new MBTs possibly looking towards the Leopard 1 A5 and new APCs, which may fall to the M113.

Canada The government awarded its CAD$600m Tactical Armoured Patrol Vehicles (TAPVs) contract to Textron, plus a $100m deal for through life support, which will see delivery of a minimum 500-strong fleet by 2016. Close Combat Vehicle (CCV) bids are now being submitted following Canadas recent Request for Proposals to enter into service at least 108 units. One requirement on the CCV includes the highest level of IED protection.

Source: Richard de Silva, Defence IQ

THE AMERICAS



Norway The Norwegian Army sealed its $1bn vehicles contract with BAE Systems. The Army currently has 103 CV-90 Infantry Fighting Vehicles, which are to be outfitted with upgraded capabilities thanks to the deal. Aside to new hulls, turrets and maintenance support, the agreement will see 146 remanufactured or new CV-90s, additional UGVs and UAVs, ground sensors and communications systems, as well as 74 Infantry Fighting Vehicles, 15 Command Vehicles, 16 Combat Engineering Vehicles, 16 Multi-Role Vehicles, 21 Reconnaissance vehicles and 4 vehicles for training purposes.

Finland The Finnish MoD has signed a $1.7m contract with W&E Platt to equip its RG-32M mine hardened armour patrol fleet with MR550 Bi-Metal Ring Mounts. Meanwhile, indigenous firm Patria has scrapped a 219m contract to provide 135 vehicles to Slovenia.

Denmark The Danish MoD has pitted 8 companies against each other for a contract demanding between 206 to 450 new APC vehicles as the M113 fleet comes to the end of its service life. It is undecided as to whether this vehicle should be wheeled or tracked, so bidders have been enlisted for both solutions at this stage.

Netherlands Currently selling off its entire MBT fleet and has now retired the last of its YPR765 IFVs, replacing the latter with 184 Swedish CV90s, 400 4x4 Fennek recon vehicles, and 200 Boxer wheeled armoured vehicles.

UK Having recently begun use of the Foxhound in Afghanistan, the UK MoD has ordered a further 51 Foxhound personnel carriers to be deployed to Afghanistan in a 46m deal with General Dynamics Land Systems. The UK is expecting a shortfall of vehicles up to 2025, given multiple delayed and cancelled projects. Will likely be looking at long-term solutions to offset a fleet built largely on UORs, such as Mastiff and Jackal, focusing instead on highly adaptable platforms, while also bringing some of the UOR vehicles into core through industry fleet management and upgrades. Looking to outfit Warrior with a new turret with anti-armour/airburst munitions. Also looking to increase use of COTS solutions.

Czech Republic Czech Defence Ministry plans to buy 30 MRAPs in command and liaison variants to be acquired between 2014-2017.

EUROPE



South Africa After the procurement of Patrias APCs through Project Hoefyster, defence industry watchers are wondering whether projects Sepula (IFVs), Vistula (Protected Trucks) and Aorta (MBTs) will come to a funded fruition in the near future. Whilst Hoefyster was won, it has been contested on two notable occasions, and regardless of the repeated commitment to move forward with the other projects it is uncertain whether any will be funded and when this could happen.

Nigeria Nigeria has, for a long time, been looking to buy a series of ultra mobile APCs and IFVs but from a variety of suppliers. Currently the Nigerian Army are waiting for deliveries of an adapted Oshkosh Sandcat TPV and M-LPV as well as Drakensburgs Springbuck. Has a requirement for an MRAP fleet to continue efforts to defeat IED terrorism within its borders and in neighbouring African states. Is believed to be leaning towards an indigenous manufacture of a Springbuck VI fleet, developed by Mekahog an agent of South African company Drakensberg Truck Manufacturers.

Iran Has recently unveiled the production of two new indigenous armoured vehicles: the Hoveyzeh ultralight armored vehicle and the Talaeiyeh APC. Hoveyzeh is designed to be easily transportable and will be prominent in future border protection.

UAE Issued a request in early 2012 for 600 new 8x8 APCs, with about 400 to be fitted with the BMP-3 turret, and with some production to be undertaken by local industry. Is also looking to ensure the Presidential Guard has a new 4x4 fleet, and has ordered 750 M-ATVs from Oshkosh for the Army this year.

Angola Currently looking to upgrade internal communications and air conditioning systems for T-72, BRDM-2 and BMP-2 fleets. There is speculation that Angola is looking for 4X4 or 6X6 replacements for their BRDM-2 capabilities.

AFRICA & MIDDLE EAST



Singapore ST Kinetics is working with the Singaporean Ministry of Defence to develop the Bionix AFV in response to the requirement to replace Singapores M113s

Taiwan Focusing its immediate efforts and budget on introducing its CM32 8x8 APC, so modernisation of the M48 and M41 tank fleet remains a long-term requirement. Chinese sanctions mean US companies have the best chance of supplying these upgrades.

Russia Looking to replace the majority of its tracked fleet with wheeled vehicles, due to perceived service life benefits. Receiving 57 Italian Lynx (LMVs) from Iveco by the end of 2012, the first of several new batches. Russia is also partnering with French industry to develop a brand new IFV, due to be complete by the end of 2013.

India $10bn Futuristic Infantry Combat Vehicle (FICV) project continues, with down select expected soon. Despite indigenous manufacturing requirements, international firms are involved in the bidding, including BAE and Rheinmetall, and further opportunities should emerge with the decision on the two final contenders. Has also been developing the Arjun Mk.II, but ordered Russian T-90Ms (built in India) to fill the delay. Needs to retrofit T-72s through Project Rhino, including new sensors, but as the T-72s are likely to end service life in 2020, a brand new replacement MBT fleet will be required. Unofficially, India is looking at the prospect of a light tank preferably transportable by helicopter to see to its more mountainous regions, as well as prospects for a High Mobility Vehicle and MRAP.

Japan Is looking to introduce its long-developed home grown Type 10 MBT. Has a requirement for new amphibious landing vehicles, to be purchased in 2013.

Indonesia Indonesia is readying to receive at least 37 BMP-3F IFVs in a signed $114m contract, adding to the 17 that Russia has already supplied. Requires a modern tank fleet, but probably one that is nimble enough to traverse its narrow and underdeveloped road networks, and is looking to Germany and the Netherlands as potential suppliers.

ASIA PACIFIC



Through-life support for armoured vehicles is becoming an increasingly vital factor during the tender process. During the economic downturn governments have realised that making cost efficiency savings wherever possible has never been more important. Looking at Figures 10 and 11, the largest increase in the critical category year-on-year is for reducing repair and maintenance costs; 26% of respondents saw this as a critical requirement in 2012 compared with 40% in 2013. Mirroring this increase is a 7% year-on-year rise for the need to reduce the unit cost of armoured vehicles. Figure 10 highlights that 40% of respondents think this is critical in 2013. The top level analysis of Figures 10 and 11 must be that cost is becoming more and more of an issue. Budgets are tightening, and industry is starting to feel the squeeze. Adaptability also saw a small bump with 34% indicating it as a critical requirement. There is an understanding in industry that the threat landscape is changing rapid and unpredictably. Government is demanding more and more flexibility with the platforms it acquires and so manufacturers increasingly have to develop more modular systems together with interoperable equipment in order to future-proof these assets.

According to Lt. Col. Pritchard all armoured vehicles need to be future-proofed going forward and as such they need to be thought of as like clothes hangers they must be designed from the outset to be interchangeable and modular. Load carrying capacity and mission range were generally considered to be the least important armoured vehicle requirements.

Cutbacks threaten key design developments

The IED and the networks that use these asymmetric weapons will remain a threat to our forces and here at home for decades the IED is the artillery of the 21st Century. Lt. Gen. Michael D. Barbero, Director, JIEDDO


0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Ballistic protection

Blast protection / counter-IED

Load carrying capacity

Mission range

Modular / interchangeable mission role (adaptability)

Power/weight ratio

Reducing repair/maintenance costs

Speed/ maneuverability

Easily transportable

Reduced unit cost out of factory

Reliability

Figure 10 Analysis of key armoured vehicle requirements, 2013 - 2023

Unimportant Moderately important Very important Critical

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Ballistic protection

Blast protection / counter-IED

Load carrying capacity

Mission range

Modular / interchangeable mission role (adaptability)

Power / weight ratio

Reduce repair / maintenance costs

Speed / maneuverability

Easily transportable

Reduced unit cost out of factory

Reliability

Figure 11 Analysis of key vehicle requirements

(data from 2012 survey for comparison purposes)

Unimportant Moderately important Very important Critical

The need to manufacture reliable vehicles was emphasised as a critical requirement, second only to IED requirements, which have been discussed at length in this report. Speaking to Lockheed Martin recently, ensuring reliability for the UK MoDs Warrior Capability Sustainment Programme (WCSP) is the critical factor. The governments requirements for reliability represent a step-change in anything thats gone before. Its something that is at the forefront of the WCSP teams mind at Lockheed, especially that of programme manager Colin Gilding who said that reliability is a big part of this programme it permeates every decision we make.

Peter Pietralski, Lockheed Martins business area chief engineer vehicles, agreed saying that the key challenge for WCSP is to provide a reliable platform [to] ensure its capable, not only for tomorrow but well into 2040. He explained that Lockheed is implementing rigorous testing procedures at every stage and is looking all the way down to the sub-system level to achieve the reliability required.


While the case for greater mobility grows louder as the demand for light armoured vehicles continues to rise, Swedens Chief of the Army Staff, Major General Anders Brnnstrm, warned that concentrating on either factor too much is counter-productive. The trick is to maintain a combination of different vehicles and capabilities. You have to have different types of vehicles. You have to have Main Battle Tanks you need to have them because the enemy needs to know that youll always have them, Major General Brnnstrm told Defence IQ. You have to have wheeled vehicles and you have to have tracked vehicles. Its not about choosing either protection or mobility you shouldnt separate them too much you need to have a balance. In this respect Im glad that the Swedish Armed Forces has different types of vehicles. The debate about protection vs. mobility must of course be considered in the context of the likely battlespace. Fanie Pretorius, CEO at EWI2 (Pty) Ltd., said that armoured vehicles should be acquired for purpose. Discussing the MRAP, Pretorius claimed that these vehicles lack the off road mobility to be effectively applied in asymmetrical warfare. While MRAP vehicles have has excellent protection for certain warzones, that extra weight would soon become a burden irregular environments.


According to Buddy Carman, Director of government business development for C2/SA at ViaSat Inc., the debate goes further than protection or mobility alone. Networked capabilities and integrated electronic architectures will form the foundation for all armoured vehicle platforms going forward. In addition to balancing protection vs. mobility, simplifying logistical support, and reducing costs, a critical aspect of survivability and performance for armoured vehicles is integration into the network, says Carman. Situational understanding gained through networked vehicles can enhance mobility and protection. The modern AFV uses an array of often complex electronic subsystems to carry out its mission, says a recent whitepaper by Ultra Electronics. No longer just a large gun or battlefield taxi, the AFV is considered an important asset in todays digital battlespace; providing front line information to the strategy planners as well as a hub for the troops on the ground.


The Armoured Personnel Carrier (APC) is the armoured vehicle variant that respondents believe will be in most demand over the next ten years (Figure 12). However, it was a clustered dataset where 33% of respondents chose the APC, 25% the MRAP and 24% the Unmanned Ground Vehicle (UGV). The revelation that a quarter of respondents plumped for the unmanned variant is staggering. A recent Visiongain report

determined that the value of the global Unmanned Aerial Vehicle (UAV) market in 2012 will reach $7.26 billion. If the UGV market followed a similar growth trajectory then clearly demand could soar for these unmanned platforms over the next decade.

Goodbye MBT. Hello UGV?

3%

12%

25%

32%

24%

4%

Figure 12 Overview of demand for armoured vehicle type

Main battle tanks Lightweight scout vehiclesMRAP Armoured personnel carrierUnmanned ground vehicles(UGV) Other


In an interview with Globes last year, Elbit Systems president and CEO Joseph Ackerman said: Unmanned land vehicles is a very difficult field. The world hasnt yet grasped their potential We havent yet been able to persuade potential foreign customers that these vehicles are worthwhile financially, and it should be remembered that land forces are much more conservative than airmen. All they talk about is procuring hundreds of manned armoured vehicles and it hard for them to change their combat doctrine. According to the data in Figure 12, the move towards using more unmanned platforms on land looks to have begun to pivot.

At the other extreme, the era of the Main Battle Tank (MBT) looks to be over; just 3% of respondents backed the variant. The MBT, and probably Infantry Fighting Vehicle (IFV), is now a liability and has become a target in itself; without aerial superiority or supremacy the MBT is a sitting duck, said one official from the UK MoD. Lighter, faster, more flexible armoured vehicles will be required to provide support to dismounted or mounted infantry. Wars are too expensive for prolonged engagement; fast-deployment; efficient and effective strike with flexibility and speed of re-deployment will be required.

Soldiers entering the military today are digital natives they have grown up with computing devices that are networked together. Our culture has trained them to be proficient in accessing and exploiting digital technology. Our view of armored vehicle improvement needs to leverage this capability to add additional survivability and mission effectiveness. Buddy Carman Director, Government Business Development for C2/SA, ViaSat, Inc.

International Armoured Vehicles 2013


As the worlds largest meeting dedicated to the armoured vehicles community, International Armoured Vehicles offers attendees a unique combination of high-level conference alongside a focused exhibition, which delivers comprehensive value for senior military, vehicle manufacturers and integrators, components suppliers and service providers and end users of vehicles alike, offering the only truly 360 perspective on the armoured vehicles industry. See the latest agenda. This year, Defence IQ is pleased to present the brand-new Dynamic Vehicle Experience at the Long Valley Test Track, as well as its vibrant vehicle display of 15 vehicles, the live simulation experience and the Innovation Stage. Further, the 2013 show introduces the Industry Focus Day, which will provide a platform for technical experts from Tier 1 companies to present their current projects, challenges and future capability requirements to members of the military and Tier 2 and 3 groups. Programmes to be discussed include the Boxer MRAV, BVP2 IFV, CV9040 IFV, M113 APC, Scout SV, and the Warthog TPMV. View the full programme here or apply for a free pass to the exhibition here.

This report was coordinated with the International Armoured Vehicles conference & exhibition, and the Armoured Vehicles conference series.

Conference Dates: 5-8 February 2013 Exhibition Dates: 6-7 February 2012 FIVE, Farnborough, UK www.internationalarmouredvehicles.com

THE ARMOURED VEHICLES CONFERENCE SERIES

Get your free pass to the exhibition here.

Defence IQ is an authoritative news source for high quality and exclusive commentary and analysis on global defence and military-related topics. Sourcing interviews and insights directly from senior military and industry professionals on air defence, cyber warfare, armoured vehicles, naval defence, land defence and many more topics, Defence IQ is a unique multimedia platform to discuss and learn about the latest developments within the defence sector. So join over 65,000 defence professionals to access all the exclusive video interviews, podcasts, articles and whitepapers that are available and updated on a daily basis. Join today for free by signing up on our website: www.DefenceIQ.com/join.cfm Connect with us through social media too, just follow the links below:

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About Defence IQ


Andrew Elwell is the Editor-in-Chief of Defence IQ. He has previously worked as a survivability specialist for a provider of ballistic and blast armour systems. Andrew holds a BA in History and American Studies from the University of Nottingham. He can be reached on [email protected]. Connect on LinkedIn Follow on Twitter: DefenceIQ

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