The plan includes $860 million to upgrade a fleet of Light Armored Vehicles and has the overall goal of enabling Canadian forces "to respond effectively and success to a full spectrum of military operations," the Ministry of Defense said in a release.
The new vehicles program is part of the Canada First Defense Strategy introduced in May 2008.
Canadian Minister of Defense Peter MacKay and Minister of State Keith Ashfield joined Chief of Land Staff Lt. Gen. Andrew Leslie in making the announcement.
"The government is committed through its Canada First Defense Strategy to renewing the Canadian Forces' core equipment," MacKay said. "In addition to a renewed commitment to domestic security, this defense investment creates jobs, brings economic benefits to Canadian industry and creates and sustains long-term employment for Canadians."
The Defense Ministry said the vehicle program would "deliver significant economic benefits across Canada." It said Canadian firms would participate in the manufacture, engineering and support services over 25 years. Contract awards for all four sections of the plan are expected in 2011.
The Canadian military is to start using the new land combat vehicles by 2012, with a fully operational fleet intended for 2015.
The ministry release said the planned Tactical Armored Patrol Vehicle will replace the Armored Patrol Vehicle, the LAV 2 and will complement the Light Utility Vehicle Wheeled. That project foresees the procurement of 500 vehicles with options for up an additional 100. Canada will acquire up to 200 of the Recce variant and up to 300 of the general utility variant. Deliveries will begin in 2012 and initial operational capability is expected a year later.
The LAV III Upgrade project will upgrade 550 vehicles with an option for an additional 80. Initial operational capability is scheduled for 2012.
Also, the ministry expects to buy 108 Close Combat Vehicles with an option for up to 30 more, and 13 Armored Engineer Vehicles, with options for an additional five vehicles.
Leslie said: "These vehicles will provide the army with the modern and robust equipment needed to fulfill its role in today's increasingly dangerous operating environment. They will also ensure that we are ready to take on the challenges of the future."
The program is in the definition phase, which analyzes procurement strategies and specific requirements. The ministry said General Dynamics Land Systems-Canada will develop a solution for the upgrade of the LAV IIIs.
The Industrial and Regional Benefits Policy will be applied to all projects. Winning contractors will be required to undertake business activities in Canada at 100 percent of the contract values. This means that one dollar of economic activity will be generated in Canada for every contract dollar awarded.
"The government of Canada is determined to provide our forces with the best possible equipment while delivering the transparency and accountability Canadians expect," Canadian Minister of Public Works and Government Services Christian Paradis said. "The project announced today will help our forces fulfill their specific and unique tasks and provide significant economic benefits for Canadian businesses here at home."