Rheinmetall has decided to base its Australian defence operation in Adelaide as it expands from its German headquarters and creates global hubs.
Adelaide Now reports that Rheinmetall Simulation Australia chief Adrian Smith will also take on the role of national managing director of Rheinmetall Defence Australia.
“Rheinmetall Defence’s 2015 ambition to establish a hub in Australia to drive growth in the region will be integrated (into its hub strategy),” Mr Smith.
According to Mr Smith, Adelaide was chosen as the base because of its strong defence technology sector, skilled workforce and supply chain. In addition, the strength of Defence SA played a role in the decision.
Mr Smith said the company is bidding for the Australian Defence Forces (ADF) $10 billion Land 400 Land Combat Vehicle System program and is also looking at 27 other defence contracts in Australia and New Zealand.
However, he added that the fact that the Federal government has not yet finished its defence spending white paper was a challenge for his company.
Earlier this month, Rheinmetall MAN Military Vehicles GmbH reversed a subcontracting decision regarding the manufacture of army trucks for the ADF.
Initially, Australian company Varley Group missed out on the $40m subcontracting deal, even though the contract specified that that 35 per cent of the vehicles’ content must be locally made.
Later, a Federal government probe into Rheinmetall’s subcontracting process was set up. Its aim was to find out if the work was actually to be done by an Australian company.
Rheinmetall decided to reverse its original decision and award the work to Varley Group before the investigation concluded.