Europe’s car makers turn to defence as Ford bids for 9,000 army vehicles

European car makers are turning to defence as civilian vehicle demand, electric-car sales and factory utilisation come under pressure. Ford, General Dynamics and Ricardo are bidding for a UK Ministry of Defence contract to supply 9,000 vehicles over five to seven years.

The Light Mobility Vehicle programme is intended to replace the British Army’s ageing Land Rover-based fleet. Ford’s Ranger-based vehicle can carry two tonnes and tow up to four; about 2,000 people still work at the company’s Dagenham engine plant.

Engine production at the site has fallen from 90,000 units a year to roughly 45,000 over the past decade. Ford UK chair Lisa Brankin described the defence bid as an opportunity to use the company’s ability to respond quickly to military requirements.

Carmakers expand into defence work

Ford is not alone in seeking military business. Renault has signed a strategic agreement with Thales to produce military drones, targeting up to 1,000 units a month.

Volkswagen has agreed to sell its under-used Osnabrück factory, which is due to become a military manufacturing hub in a joint venture with an Israeli-based defence investor. Jaguar Land Rover is also bidding for the British contract and has created a dedicated unit for international military business.

Falling output and exposed suppliers

European manufacturers are spending billions on the shift to electric vehicles while EV sales grow more slowly than expected and Chinese brands including BYD, Chery and Geely expand in Europe. The industry has also lost the steady Chinese profits that once accounted for as much as half of Volkswagen’s earnings.

Western European plants have an estimated 2.5 million vehicles of spare annual capacity. Volkswagen plans to cut 100,000 jobs, has closed its Dresden plant and is considering closing four more sites.

In Britain, JLR’s plan to cut 4,000 of its 30,000 UK jobs has raised concerns among suppliers. Executives representing companies with more than 8,600 direct employees have urged the government to help the sector move into aerospace and defence; the wider supply chain supports about 183,000 manufacturing jobs.

The shift has a historical precedent. From 1939 to 1945, Ford’s Dagenham plant built 360,000 vehicles for the Allied war effort, while Ford workers in Manchester produced 34,000 Merlin engines for fighter aircraft.