Queensland is inching slowly closer to winning a $5 billion Australian Army contract to build up to 10,000 new-generation army vehicles.
It has been earmarked as one of two preferred sites for a military vehicle "centre of excellence" by a company with a major army contract that is now looking to win a second.
One of two companies bidding to build new army vehicles, Rheinmetall has shortlisted Queensland and Victoria as a potential centre for excellence to build new military vehicles.
Rheinmettal is the largest supplier of military vehicles to the Australian Defence Force and progressively building 2500 logistics trucks for the Australian Army as part of an existing contract.
It is now bidding to build the new-generation armoured combat reconnaissance vehicle as part of the Department of Defence's $5 billion LAND 400 Phase 2 contract.
State Development Minister Anthony Lynham travelled to Canberra to press Queensland's case for the contracts earlier this month.
This contract will choose a new Combat Reconnaissance Vehicle (CRV), a new Infantry Fighting Vehicle (IFV), a new Manoeuvre Support Vehicle and an Integrated Training System.
The other company bidding for the $5 billion contact is BAE Systems, which has its main headquarters in South Australia.
The company has on Friday decided that Queensland and Victoria are its two preferred sites to build a brand new manufacturing "centre of excellence" for this contract, the company's Australian managing director Andrew Fletcher said.
"Both states have a powerful argument before Rheinmetall as a primary location for the military vehicle centre of excellence (MILVEHCOE) and we look forward to continued discussions with each state government," Mr Fletcher said.
"It should be emphasised that the 'centre of excellence' will be a centre of competence that draws on skills, services, products and capability from every state and territory in Australia," he said.
It will provide 250 new jobs in the state that wins the contract.
Queensland has been angling for the extra Australian Army contracts because it has the largest concentration of Army servicemen and women, bases, equipment and heavy-vehicle manufacturing.
Dr Lynham welcomed the short-listing of Queensland by Rheinmetall as potential centre for excellence for military vehicles.
"Queensland is home to the largest concentration of Australian Army personnel and assets, and offers unmatched heavy-vehicle manufacturing capability," he said.
"It offers up to 250 long-term jobs and real opportunity into the future beyond the initial major contract, should Rheinmetall be selected by the Commonwealth."
A 12-month trial of equipment and vehicles from both companies bidding for the contact began in January 2017 and a decision will be made in early 2018.
