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Australian Defence projects growing Australian Defence industry

This photo is of the Chief of Army, Lieutenant General Rick Burr AO DSC MVO, who is standing on the left is meeting with industry partners at Rheinmetall’s MAN Military Vehicle centre in Wacol, Queensland.
The Chief of Army, Lieutenant General Rick Burr AO DSC MVO, (left) meets with industry partners at Rheinmetall’s MAN Military Vehicle centre in Wacol, Queensland.

Army’s Combat Reconnaissance Vehicles (CRVs), Navy’s offshore patrol vessels (OPVs) and Air Force’s Joint Strike Fighter projects continue to deliver the benefits of Defence’s engagement with Australian industry—keeping Australian workers employed and growing capability for the future.

In the Boxer CRV project, Rheinmetall Defence Australia is delivering and supporting 211 vehicles, through contracts1 valued at approximately $3.3 billion (acquisition) and $192 million over seven years (support), which will generate approximately $1.3 billion2 and $156.3 million in Australian industry participation respectively. Independent modelling over the capability’s life indicates total economic benefit of $10.2 billion.

The project to deliver the Arafura class OPV will generate a peak of 400 direct and 600 indirect jobs for Australian workers. Planned Australian industry participation currently exceeds 60 per cent, or approximately $1.2 billion. The prime contractor, Luerssen Australia, is committed to maximising Australian industry opportunities in its program of work. An example of this commitment is the award of a major subcontract to Marine Technicians Australia in place of a proven international supplier Luerssen already had in place, achieving significant growth of Australian industry early in the program.

The Joint Strike Fighter program uses worldleading thermal processing by Heat Treatment
Australia (HTA). This has played a large part in HTA’s skills and technical growth and in the
expansion of its operations from one person and one building to more than 65 people across Australia and the United States. HTA’s development of new-to-Australia thermal processes is also enabling its customers to reach into new industries. Its Joint Strike Fighter success has opened up additional domestic and international revenue streams for the company, from aerospace and defence to Formula One motor racing vehicles.

Notes:
1. This represents the value of the contracts when signed in 2018.
2. The AIC commitment of $1.3 billion referred to in the Defence Strategic Update excludes Australian taxes, custom duties, insurances, bank fees, infrastructure, corporate overheads, goods and services. When these values are included, the total AIC value increases to $1.685 billion.