LONDON, March 25 (UPI) -- Britain this week awarded a major tank contract to the United States' General Dynamics and not Britain's BAE Systems.
The BBC said the contract to build a light reconnaissance tank for the British armed forces is worth $3 billion. The so-called Scout tank is intended to replace the Scimitar vehicle currently deployed in Afghanistan.
While the Scimitar was developed in the 1960s, Britain said the new model would be more reliable, provide greater firepower and protection as well as longer-range sensors and sighting systems. The deal comes after troops there criticized their equipment, especially related to armored vehicles.
General Dynamics is build 600 lightweight tanks, with the possibility of additional purchases in the future.
Media reports mentioned a close race between the Americans and the British, with BAE Systems lobbying Prime Minister Gordon Brown to win the deal.
Despite the intense competition, Britain's Arms Procurement Minister Quentin Davies said the outcome of the bidding race was clear early on.
"We looked at performance, the prospects to enhance that performance, the cost and the through-life cost and it was a clear win by General Dynamics on all counts," Davies, told the Financial Times newspaper.
BAE Systems had hoped that it could save 500 jobs by winning the contract but those jobs will now be lost, the company said. A tank production facility in Newcastle will likely be closed.
London's decision is nevertheless good news for the job market.
General Dynamics said it will produce most of the vehicles in Britain, claiming this will secure or create 10,600 jobs.
The British opposition nevertheless condemned the deal. Liam Fox, the Tories' shadow defense secretary, said London was wrong to sign such a major contract weeks before a general election.
"Whatever the merits of the program, it does not make sense to commit to it so close to a strategic defense and security review, which will look at every aspect of Britain's defense and national security," Fox was quoted as saying by the Financial Times. "Labor is now like a bankrupt shopaholic on one last spending binge before jail, spending taxpayers' money which they hope not to be responsible for."
Davies rejected the criticism.
"We need to get this capability to the armed forces as quickly as possible," he told the Financial Times.