LONDON -(Dow Jones)- BAE Systems PLC (BA.LN) will Thursday submit a bid for the British army's GBP2 billion armoured vehicle program, the company said in a statement Sunday.
The bid is for the first phase of the army's specialist vehicles program which will replace the aging Scimitar fleet which British troops use for reconnaissance missions across hostile terrain. The new vehicles will improve protection, firepower and reconnaissance abilities.
The U.K. Ministry of Defence has said it will select a winner in the first quarter of 2010, BAE said.
The variants of the new vehicles will be built using BAE Systems CV90 Chassis, which is already sold to six countries, and although the chassis itself is manufactured in Sweden, the variants would be fitted in the U.K., thereby preserving jobs.
Evolution Securities analyst Nick Cunningham said there is still the issue of what form the contract will take in terms of scale and timing, considering the government budget constraints.
"The program will happen eventually but how big it will be and when is a major issue," he said.
Although the contract is relatively small in relation to BAE's own large size, losing the contract would likely mean U.K. job losses, Cunningham added.
-By Kathy Sandler, Dow Jones Newswires; 44-207-842-9293; kathy.sandler@dowjones.com