ADI Limited today signed two major Department of Defence contracts totalling more than A$1 billion.
The contract to upgrade the Royal Australian Navy's six guided missile frigates (FFGs), worth $900m, was followed by the $180m contract to supply 370 infantry combat support vehicles to the Australian Army. Both signings took place in Canberra. The two contracts were won after highly competitive processes involving Australian and overseas companies. The Australian Army only awarded its project to ADI after an exhaustive 12 month evaluation of the two short-listed vehicles. ADI managing director, Mr Ken Harris, said the contract successes reflected the exciting, leading edge technology Australian industry now offered. "Australia is now producing the highly advanced products which until recently it would have had to import," he said. "The gun and missile control system designed for the FFG upgrade will be manufactured in Australia, the first time such an advanced firing system has been made locally. "The upgrade is primarily a very complex systems integration task and Australia has also demonstrated its ability to successfully manage such tasks by the on schedule progress of the Huon Class minehunter programme." Centred on improving the FFG combat capability, the upgrade is the biggest modernisation project undertaken by the Navy and its biggest project since awarding ADI the $1 billion Huon Class minehunter contract in 1994. ADI, as prime contractor, and US companies Lockheed Martin and Gibbs & Cox as its teaming partners, will undertake a major enhancement of the frigates' combat system. Lockheed Martin is a leading systems management organisation, prominent in the design, development, manufacture and integration of naval combat systems, while Gibbs & Cox is the US Navy's surface combatant ship designer and the designer of the FFG-7 class worldwide. ADI's enhancement proposal, which includes a substantially upgraded fire control system, will offer export opportunities because earlier versions of the system are being used by 63 ships from seven countries including the US. Similar opportunities apply to the new command and control system planned by ADI because the 63 ships use the same system genealogy. Mr Harris said the upgrade, to be carried out at ADI's Garden Island facility in Sydney, would generate more than 500 new jobs. He said the design and acquisition phases of the FFG project would commence this week, but peak activity would not be reached until 2002 when work on board the first frigate commenced. The 500 jobs would include new positions created at sub contractors to the project. Work on the final frigate is scheduled to be completed at the end of 2005. Mr Harris said that the vehicle contract was similarly a high technology response to the Australian Army's armoured vehicle needs. ADI's Bushmaster would be the first Australian designed and developed armoured vehicle introduced into service by the Army since World War II. "ADI is now one of a handful of companies in the world internationally recognised for its landmine protected wheeled vehicles," he said. "Importantly, Bushmaster has proved it can handle any conditions, having been tested in the snow and ice of Australia's alpine region and the heat and sand of the outback. "Bushmaster's success against international competition has given credibility to both its capabilities and ADI's ability to design, develop, test and manufacture vehicles requiring superior landmine and ballistic protection." ADI will deliver the first Bushmaster prototype to the Army at the end of this year, with another five prototypes to follow in 2000. The first production vehicles will be delivered in December 2000. ADI has begun recruiting the additional 40 employees it requires at its Bendigo facility for the vehicles contract. All the new positions are expected to be filled by June/July 2000. Mr Harris said 138 Australian suppliers would benefit from the project, 68 from regional Victoria. Virtually all the vehicle components other than the drive line would be supplied from Australia. From 2001, two Bushmasters will be produced each week at Bendigo. ADI estimates the flow-on effect will result in Victoria benefitting by about $180 million from the project. Regional Victoria will receive more than $45 million of that amount. Bushmaster will provide the Army with armoured mobility to transport fully equipped troops from their home bases to areas of operation quickly, safely and battle ready. Designed from the ground up in Australia, the vehicle provides protection from landmines, 81mm mortar, NATO 5.56mm and 7.62mm ball ammunition and Claymore antipersonnel mines. Mr Harris said ADI was confident international customers would find the Bushmaster highly compatible with their operational doctrines. "This is not just another armoured vehicle," he said. "Technology is driving military tactics around the world and Bushmaster has been designed and developed to support those tactics." The Bushmaster success follows ADI winning another significant Australian Army contract - the supply of 27 high speed engineering vehicles (HSEV). The HSEV was designed, developed and tested by ADI to meet an Australian Army requirement and is now being manufactured at ADI's Bendigo facility. ADI is now in the final stages of being sold. Mr Harris said that ADI had developed a strong business base for the future. This included: - The $1.2 billion contract to supply munitions to the Australian Defence Force. - The $1 billion contract to produce six minehunter ships for the Royal Australian Navy. - The $900m contract to upgrade the RAN's guided missile frigates - The $180m contract to build armoured vehicles for the Australian Defence Force
Mr Harris said these contracts and the company's substantial position in the military information technology business and in the ship repair, engineering and systems engineering businesses made it one of Australia's most successful defence contractors. "The Australian defence market is very competitive. We are very pleased to be able to present to the bidders for ADI the outcome of our competitive success, as well as a company that is imbued with a strong competitive spirit." ;
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ADI Limited today signed two major Department of Defence contracts totalling more than A$1 billion.
