GLOBAL DEFENSE MARKET

Foreign Truck Makers Face Tight Budgets

10/1/2015
By Yasmin Tadjdeh
 
International truck manufacturers are confronted by many of the same issues their U.S. counterparts encounter — tighter budgets and fewer contracts, said one expert.

“Your colleagues in acquisition and procurement, your colleagues in the armed forces and in the international market, they really have the same challenges that you do,” said David Hiley, an analyst at Renaissance Strategic Advisors, a global aerospace and defense consultancy group.

“Budgets are, of course, typically much tighter in international markets,” he said during a panel discussion at the National Defense Industrial Association’s tactical wheeled vehicle conference.

While there isn’t a homogenous international market, many countries want improved armor, lethality, protection, survivability, power efficiency and mobility. The weight of vehicles has become less important, as has air transportability, he said.

International customers — who are, like the United States, operating in times of constrained military budgets — will likely opt for smaller fleets of more expensive, sophisticated vehicles.

“There are going to be opportunities to compete … [but] programs are going to be smaller [and] competitions are going to be much harder,” Hiley said.

However, he predicted that there would be a robust service support and modular upgrade market.

Ghaith Hidayah, general manager of Jordan Light Vehicle Company Manufacturing LLC, a subsidiary of King Abdullah II Design and Development Bureau Investment Group, said its customers want greater firepower and more protection for personnel. Additionally, they want better situational awareness and ways to detect improvised explosive devices, he said.

There is a need for light tactical vehicles in the Middle East, but there have been fewer contracts, he said.

“The need of light vehicles and tactical vehicles is high in the region, but because of the security issues … the market has declined a lot,” he said, referencing ongoing tensions with groups such as the Islamic State. One of his competitors, he noted, had about 15,000 vehicles in their inventory worth millions of dollars that weren’t being sold.

Topics: Land Forces

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