BAE awarded $575M for Armored Multi-Purpose Vehicle production

Feb. 19 (UPI) -- The U.S. Army has awarded BAE Systems two contracts worth $575 million for low-rate production of the Armored Multi-Purpose Vehicle.

In January, the company was awarded $128 million to start building the vehicles, and this month $447 million has been awarded for low-rate initial production.

The company said the vehicles, which are expected to replace Vietnam War-era M113s, meet the Army's requirement for force protection and all-terrain mobility requirements.

The AMPV is designed to operate alongside the M1 Abrams tank and the M2 Bradley as part of the rest of the Armored Brigade Combat Team.

The Army has awarded a total of $873 million has been allocated for the low-rate production phase, the company said in a news release Tuesday.

The contract was initially awarded in 2014, with the target date for delivery of the first equipped unit is the fourth quarter of fiscal year 2021.

The company produced and delivered 29 prototype vehicles to the Army for test and evaluation purposes last year. The first vehicles were primarily manufactured at the company's plant in York, Pa., as part of the engineering, manufacturing and development phase.

In the low-rate production phase, the Army wants 460 additional vehicles, which will add up to a total value of up to $1.2 billion. The five variants of the AMPV are command and control, general purpose, medical evacuation, medical treatment and mortar carrier. The general purpose variant accommodates two crew and six passengers.

Besides York, construction will take place in Aiken, S.C., Minneapolis, San Jose, Calif., and Sterling Heights, Mich.

"Moving into this phase of the AMPV program is exciting because it brings soldiers one step closer to deploying this critical capability for completing their missions and coming home safely," Bill Sheehy, AMPV program director for BAE Systems' combat vehicles business, said in a statement. "We have been preparing for this moment and are ready to take this program to the next stage."

In all the Army plans to acquire 2,897 vehicles, Breaking Defense reported late last year.

The global armored vehicle market size is projected to reach $36.4 billion by 2025, according to a report released last week by Grand View Research.