RHM Rheinmetall AG

   By Alice Uribe 
 

SYDNEY--A South Korean company has won a multi-billion-dollar defense contract to deliver infantry-fighting vehicles to the Australian armed forces to boost the country's army and provide high-level protection for soldiers.

Hanwha Corp. beat out Rheinmetall, a German company, in a tender process to clinch the deal to build 129 infantry-fighting vehicles. Australian authorities said the contract was worth as much as 7 billion Australian dollars (US$4.73 billion), making it one of the largest capability acquisition projects in the history of the country's army.

The government said it "is accelerating this acquisition so that the first vehicle will be delivered in early 2027, two years earlier than the former government had planned. The final vehicle will be delivered by late 2028."

A wide-ranging review of Australia's military in April found that the U.S. ally needs to quickly overhaul its armed forces amid concerns that rising tensions between the U.S. and China could increase the chance of a conflict in the region. Australian officials said at the time that they agreed with the review's conclusion that the military isn't fully fit for purpose in the current strategic environment.

The deal with Hanwha Defense Australia, known as the LAND 400 Phase 3 project, will replace M113 armored personnel carriers that were acquired in 1964. The new infantry-fighting vehicles, called Redbacks, will be delivered at around the same time as the new HIMARS missile systems and Army Landing Craft, the authorities said.

Geelong, a city in Victoria state, will be a beneficiary of the deal, as the vehicles are due to be built in that region. Minister for Defence Industry Pat Conroy said the government wanted to make more critical defense equipment in Australia, rather than relying on overseas suppliers.

"Our decision to build the Redback infantry-fighting vehicles in Australia will support up to 600 direct jobs and more than a thousand jobs in the Australian industry supply chain," he said.

Write to Alice Uribe at alice.uribe@wsj.com

(END) Dow Jones Newswires

July 26, 2023 22:26 ET (02:26 GMT)

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