$1.14 Billion Orders Sustain MRAP Production Through 2008

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The Pentagon released last week (March 14, 2008) five new contracts for the dlivery of 2,243 Mine Resistant Ambush Protected (MRAP) vehicles at a total value of these contracts is over $1.14 billion. These new orders will to be completed by November 2008. Sharing these new orders are BAE Systems, International Military and Government LLC (IMG), and, to a lesser volume – Force Protection International.

BAE System’s subsidiary Stewart & Stevenson Tactical Vehicles, was awarded a fourth order worth $482 million for the production of 1,024 Caiman vehicles. These CAT II vehicles will be configured with CAT I seating. BAE Systems will also deliver 393 CAT II RG33 vehicles, 51 heavily armored ambulances and three Special Forces Command Vehicles based on the MRAP design, under a separate $234 million order. With the two new contracts, the company now has firm orders worth $2.95 billion to deliver 3,150 Category I vehicles and 1,927 Category II vehicles for the U.S. Army, the U.S. Marine Corps and Special Forces. More than 2,000 BAE Systems employees in the United States and 400 in South Africa are producing these vehicles. In addition, about 500 personnel are supporting them in theater, as part of a fielding organization established by the company.


International Military and Government LLC (IMG), received a seventh order worth $410 million for 743 Category I vehicles (Maxxpro), The company is producing the MaxxPro at a pace of 500 vehicles per month, and has already delivered 2,000 vehicles to the military (of which some 1,500 are already operational). IMG’s overall MRAP vehicle orders total more than $3 billion since the first contract was awarded in May 2007.

While this mammoth production effort demonstrated the company’s resilience, it also challenged its supply base to the limit. Plasan, International’s armor producer partner announced last week that by the end of February 08 it delivered about 2,000 MaxxPro armor kits. The company is currently working on new orders for 2,500 kits. To sustain this production surge Plasan expanded its US production facility in Vermont, increasing employment nearly fourfold to more than 200 jobs while adding new, larger capacity equipment. Plasan licensed its technology to IMG, which is then shares Plasan’s design, technology and assembly with other suppliers to expand production capacity. Plasan also maintains a globally balanced supply chain enabling the company to rapidly respond to urgent customer requirements.

Force Protection Industries received a smaller order worth about $10 million funding acquisition of 18 vehicles – a dozen CAT I (Cougar) and six CAT II. These vehicles are used primarily by the U.S. Marine Corps. The company will also deliver 11 MRAP CAT III (Buffalo) route clearing vehicles under a separate $8 million order.