Ottawa sidelines foreign firms in $4.9B army vehicle competition

Ottawa sidelines foreign firms in $4.9B army vehicle competition

Carney government moves to bolster domestic defence industry

The Carney government quietly cancelled the second phase of a long-standing competition to provide the army with light utility vehicles and intends to "invite a limited number of Canadian suppliers" to bid directly, CBC News has learned.

Public Services and Procurement Canada (PSPC) issued a notice late Friday that says the federal government intends to "transition to an updated procurement approach."

CBC News has obtained a copy of the notice which cancels an invitation to interested companies to qualify for bidding on the procurement Light Utility Vehicle (LUV) program, which the Department of National Defence website says could run up to $4.9 billion.

Six primary competitors had been identified.

Two of them are U.S. companies: AM General and Oshkosh Defence. The others are Canadian: Armatec Survivability Group, GM Defense Canada, Roshel and Terradyne Armoured Vehicles.

The move to focus the program on Canadian companies came on the eve of the NATO summit in Ankara, Turkey, and in the shadow of the multi-billion dollar announcement Monday to buy 12 submarines for the navy from German shipbuilder ThyssenKrupp Marine Systems (TKMS).

The PSPC notice said refocusing the LUV program "will also contribute to strengthening Canada's defence industrial base."

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Defence Minister David McGuinty declined to comment on the decision Tuesday on the margins of the NATO summit, saying he'd have to get back to reporters with an answer about the status of the program.

The program has been divided into two distinct phases, the first involves the replacement of the army's aging fleet of Mercedes G-Wagons and Chevrolet Silverados.

GM Defense Canada won the initial phase in July 2024 when it was awarded a $35.8 million contract to supply 90 vehicles for army personnel deployed in Latvia. Deliveries are now underway.

Senior reporter, defence and security

Murray Brewster is the senior defence writer for CBC News, based in Ottawa. He has covered the Canadian military and foreign policy from Parliament Hill for over a decade. Among other assignments, he spent a total of 15 months on the ground covering the Afghan war for The Canadian Press. Prior to that, he covered defence issues and politics for CP in Nova Scotia for 11 years and was bureau chief for Standard Broadcast News in Ottawa.