PETER LA FRANCHI / WELLINGTON
The head of New Zealand's military acquisition programme is warning that the nation's small defence industry faces reduced work opportunities once current projects are complete.
New Zealand's domestic defence suppliers will need to seek new strategic alliances with international firms for offshore work if they are to survive, says Kevin McMahon, assistant secretary for defence acquisition in the New Zealand Ministry of Defence.
Speaking at the New Zealand defence acquisition seminar in Wellington in November, McMahon said that a "slight drought" is looming in domestic military expenditure plans.
He said that the current wave of capital projects now being completed will not be replicated in value and potential workshare until after 2010, unless the government reviews its defence long-term development plan.
New Zealand is evaluating bids for upgrading the air force's Lockheed Martin P-3K and C-130s and purchasing new patrol and maritime support ships.
Planning is also at an advanced stage for a competition to replace air force Bell UH-1 Iroquois and Sioux helicopters. The cabinet is expected to consider proposals from the MoD for the launch of a competitive tender process for that requirement in the next two weeks.
McMahon says there will be "a bit of a hole between the completion or the award of contracts for these [four] projects and the post-2010 projects, which are likely to provide you with some very real opportunities".
New Zealand defence companies will need to put "more effortÉinto accessing other defence markets" to survive. "I believe that the domestic industry needs to make a concerted and co-ordinated approach to these markets," McMahon says. The creation of strategic alliances with international partners is probably the most effective way forward, he adds.
Source: Flight International
