U.S. Army deal for Gen. Dynamics Canada

LONDON, Ontario, Nov. 25 (UPI) -- A $2.2 billion U.S. military contract for manufacturing light armored vehicles has been awarded to General Dynamics Canada in London, Ontario.

The contract is for 724 LAVs, scheduled to start rolling off the production line in April 2011, the London Free Press reported Wednesday.

The company will produce 10 versions of the LAV II, an eight-wheeled, 300-horsepower vehicle that can reach 60 mph in difficult terrain.

Ironically, the announcement came a day after General Dynamics Land Systems-Canada laid off about 40 workers.

Company spokesman Ken Yamashita said the new contract offered the workers some hope.

"We'd still be going ahead with our layoff notices, but when we start hitting the production line, we'll reverse the process and we'll be calling everyone back, so these are temporary layoffs," he said.

The biggest U.S. defense contract in Southwestern Ontario was a $6 billion deal in 2001 for Stryker armored vehicles from General Motors Defense, which was later bought out by General Dynamics Canada, the newspaper said.