Sweden’s SEP (Spitterskyddad Enhets Platform, a.k.a. THOR/ Alligator) is a truly innovative land vehicle design. Wheeled or rubber band-track versions offer strong commonality benefits, provide short term tactical options via mix-and-match, and add long term procurement options for a force that buys SEP and later decides they need to complement a wheeled fleet with tracks (vid. Canada and Britain in Afghanistan) or add wheeled vehicles to a tracked fleet (vid. UAE recently). The vehicle consists of three units: (1) a basic platform, either tracked or wheeled; (2) a forward-mounted crew module; and (3) a rear role-specific module which can be exchanged depending on the mission. These removable, interchangeable mission modules allow the SEP to be configured for 24 different roles. An electric transmission system replaces mechanical drive shafts with cables, offering tactical quietness, more internal space, fuel efficiency, reduced life cycle costs, and the ability to place the engines in different places within the vehicle – or even install a second engine. Less weight gives it C-130 transportability, which is unusual for vehicles of its class.
The Swedish FMV gave BAE Hagglunds a development contract in November 2001. In 2003, they took delivery of a wheeled prototype demonstrator, and placed a risk reduction contract to develop a 2nd tracked test vehicle. That vehicle was rolled out in November 2005, and January 2006 saw BAE Hagglunds receive a Chassis Concept (CC) Technology Demonstration Programme contract from Britain’s huge FRES program. July 2006 saw a contract for final development from Sweden, which included delivery of 2 vehicles of each type.
But SEP had a problem. Several problems, actually. A Feb 6/06 report from Sweden indicates that SEP is not dead within BAE itself – but it is on thin ice as a competitive platform.
SEP’s Business Issues
The first problem was timing. The July 2006 contract prompted BAE Systems Hagglunds’ President Sven Kagevall to say:
“This is a significant order for BAE Systems Hagglunds… Since the first delivery of CV90 [armored vehicles] to Sweden [in] 1994, BAE Systems Hagglunds has sold 20 billion Swedish Kronor worth of CV90 on the export market. I am convinced that when we look back at the export figures for SEP, these figures will far exceed those of CV90. SEP will be a very good export business.”
Given that CV90 orders total more than 1,000 vehicles so far, that’s a tall order. SEP’s features could certainly make it attractive enough to win orders, in theory. In reality, however, the market for wheeled armored vehicles was shrinking fast as countries like Belgium, Bulgaria, the Czech Republic, Croatia, Poland, Portugal, Slovenia et. al. placed orders for existing offerings, and removed themselves from the market before SEP could be fielded. Other key players were already committed to programs: France’s VBCI, the Dutch/German Boxer MRAV, Italy’s projects, et. al. Natural markets Finland, Austria, and Switzerland, meanwhile, were the 3 countries producing SEP’s biggest wheeled competitors. In the tracked space, the CV90’s very success had pre-empted a good deal of the SEP’s immediate market.
That didn’t make Kagevall’s goals for the SEP impossible – but it did mean that sales would be a long-term proposition, requiring corresponding order stability and an active production line to see them through. Whereupon SEP ran into problem number 2.
In March 2007, BAE Hagglunds announced that its new SEP 8×8 modular vehicle system was delivered and ready for the UK Ministry of Defence’s upcoming FRES-Utility vehicle trials. In June 2007, however, the MoD announced the 3 finalists: France’s VBCI, GD Mowag’s Piranha V, and the Dutch-German Boxer MRAV, which Britain had originally abandoned to pursue FRES. SEP, which is several tons lighter than these competitors, hadn’t made the final cut.
With the USA’s Future Combat Systems MGV tracked vehicle development contracts already awarded, and BAE’s FRES no longer an option, the required long term production base was in dire peril. Barring clever moves like a full development & production partnership with Brazil and/or India, or an unplanned buy from a country looking to modernize its M113 or BMP-1 force, SEP’s immediate opportunities for exports and partners actually looks rather dim as one goes through the options country by country.
Which led to problem number 3.
Sweden’s defense industry has an extraordinary record of successfully developing world-class products, especially for a country of its size and population. Unfortunately, the country is also part of the European defense budget trend, and finds it difficult to even operate its present armed forces with the monies allotted. There has been serious discussion of mothballing and/or selling about half the country’s fighter fleet, for instance, and things reached the point where Minister for Defence Mikael Odenberg resigned in September 2007. He chose this path rather than continue to manage under a further 10% cut to the defense budget, which he believed to be untenable:
“[The Swedish’s military’s] finances have been disconnected from its purpose… You can’t just take away lots of defence procurement spending without it having operative effects… I want to be able to face myself in the mirror and look our military personnel in the eye.”
Pushing the SEP through to production, and correcting the inevitable glitches in its initial production design, is a more expensive proposition when done alone, by a small country. A defense budget with any headroom might allow continued production, as a national engineering priority that would be showcased in operations with the EU’s Nordic battlegroup as of 2012, and offered long-term export prospects. An Italian solution where a Ministry for Industry steps in and finances defense production with loans, as part of a national “industrial plan”, might also give a project like SEP a lease on life.
Absent these things, however, the SEP was unlikely to be viable in Sweden. Indeed, a decision had been taken that a new international partner would have to be found before 2008 to avoid cancellation. Which makes DID reader Per Bjorklund’s summary translation of “Materielprojekt stalls in” no surprise:
“The Defence Force has decided to cancel the SEP project. The reasons for this decision are that there are no international partner for the project and that the Defence Force lacks the economic wherewithal to continue the project on its own.”
It also states that the Sweden would change its armored vehicle requirements to fit the profiles of other vehicles on the market. A promise that came to fruition, when Patria Oyj’s AMV was picked over SEP in Sweden’s subsequent competition for a wheeled APC. Legal cghallenges forced a second competition, and BAE competed a simplified, conventional-drive “Alligator” variant.
They lost, again. Leaving BAE wondering what to do with their platform.
BAE’s Next Moves
(click for video)
As of February 2008, total SEP development costs have been SEK 1.35 billion (currently about $210 million): SEK 950 million from the Swedish FMV procurement agency, and SEK 400 million from BAE Hagglunds. BAE can now add some funds and look for traction, or step away from SEP/THOR, abandoning the wheeled APC market to concentrate on existing, successful land products like RG-33 mine-resistant vehicles, Bv-206S/BvS-10 Viking all-terrain tracked APCs, and CV90 tracked IFVs/light tanks.
DID subscriber Per Bjorklund offers a translation of “Hagglunds later Sep rulla vidare,” which appeared in the Swedish technical weekly “My Technik” on Feb 6/08. In summary, BAE Hagglunds’ public relations manager Marinette Radebo said that BAE continues to see a world market for SEP, and will continue to promote it – hopefully, with the Swedish Defence Force’s support in any sales process outside Sweden.
Radebo adds that the FM’s own inquiry on the matter supposedly confirmed [SEP] to be the cheaper alternative in contrast to a pure “off the shelf” procurement, but the Forsvarsmakten’s decision appears to be set in stone at this point.
If that no longer matters, the question becomes where BAE Land Systems sees the production partner it needs to revive the SEP as a platform, and give them the required steady production time, without Swedish government participation.
This Hagglunds PDF release may offer a clue – SEP/THOR was initially seen as a candidate for the US Marine Corps’ Marine Personnel Carrier (MPC) contract to replace the current General Dynamics Canada fleet of LAV family wheeled, amphibious APCs.
The “THOR” system logged over 1,000 miles in the Nevada desert over 2 weeks, as a preliminary exercise and promo. Ultimately, the SEP/Alligator was not submitted. Adding the required amphibious capability was not seen as a good option, and BAE partnered with Iveco to offer the SUPERAV instead.
With the MPC opportunity out of reach, and a simplified “Alligator” variant of the SEP defeated in a Swedish re-compete, the only live opportunity for BAE Hagglunds’ Alligator as of 2011 is Canada’s 500-vehicle Tactical Armored Patrol Vehicle competition.
Updates & Developments
Aug 16/11: BAE Systems and Iveco Defence Vehicles announce their official teaming relationship to pursue the U.S. Marine Corps Personnel Carrier (MPC) program with a modified Iveco SUPERAV 8×8 vehicle, after signing both a Teaming Agreement and Technology Cross Licensing Agreement (TCLA).
Sept 3/10: A report in Sweden’s NyTeknik suggests, but does not state, that BAE is abandoning the SEP/Alligator platform, in the wake of the Swedish FMV’s Aug 13/10 re-award of its APC contract to Patria. Subsequent developments in Canada would indicate that the platform is not abandoned just yet. NyTeknik [in Swedish] | SNAFU!
Aug 13/10: BAE Hagglunds’ simplified, less-expensive Alligator variant loses the re-done Swedish competition to Patria’s AMV. See full DID coverage.
June 15/10: BAE Systems and Iveco Defence Vehicles announce a licensing agreement to use Iveco’s amphibious SUPERAV 8×8 wheeled APC as the basis of a U.S. Marine Corps Personnel Carrier (MPC) program bid. While BAE Systems has enough divisions to also offer the SEP as a separate bid, the teaming agreement doesn’t augur well for BAE’s internal platform, which doesn’t have the required amphibious capability built in. BAE Systems.
March 10/10: BAE Hagglunds is changing its SEP, removing some of the advanced features like the hybrid diesel-electric drive, and offering the lighter, cheaper result as the Alligator. Allehanda [in Swedish] | Google translate.
Oct 29/09: The Stockholm County Administrative Court decides that the FMV’s decision to award the AWV 2014 contract to Patria’s AMV instead of the SEP must be canceled. Due to problems with the procurement process, the competition must start over.
This is a legal victory for BAE Hagglunds, who took the case to court. Patria’s response:
“Patria regrets the decision of the Administrative Court’s decision. However, Patria is confident to succeed even in the new tender process as Patria AMV is considered to be a high quality vehicle proven in the international crisis management operations.”
That confidence turns out to be justified. In the end, their AMV wins the re-compete as well, beating a simplified, conventional drive variant of the SEP called the Alligator. See full DID coverage.
Sept 9/09: BAE unveils its FRES-SV Scout demonstrator at DESi 2009. It’s based on a lowered CV90 chassis, with upgraded electronics and the requisite stabilised CTAS 40mm turret. The UK Ministry of Defence has mandated CTAS for the FRES Scout and the Warrior Capability Sustainment Programme (WCSP). Defence Management.
July 9/09: The UK Ministry of Defence has announced that it will extend FRES-SV’s draft Invitation to Tender to BAE Systems Global Combat Systems, and to General Dynamics UK. Their competing models are intended to provide reconnaissance and reconnaissance support vehicles to replace the British Army’s existing CVR (T) Scimitar and Spartan vehicles. The final Invitation to Tender is expected to be issued later in July 2009, following this initial assessment phase.
BAE has at least 2 main choices for FRES-SV. Reports to date indicate that it is likely to offer its tracked SEP/Thor modular vehicle, a new design whose wheeled model could easily become the back-door choice for FRES-U/MA – if the tracked variant wins FRES-SV, and if subsequent negotiations go well. The other option is its popular CV90 series, which is already combat proven in service with several countries. It offers a more proven solution, a wide array of developed variants, and allied interoperability benefits, at the price of having less cross-over potential.
General Dynamics is offering an upgraded ASCOD 2 IFV. This joint project of General Dynamics’ subsidiaries Santa Barbara Sistemas and Steyr-Daimler-Puch has been fielded by Spain (as the Pizarro IFV) and Austria (as the Ulan IFV); several specialty variants are already in service.
See “The UK’s FRES Transformational Armored Vehicles” for more.
June 25/09: Sweden selects Patria’s AMV as its future wheeled APC, with a EUR 240 million order for 113 vehicles in 5 variants. The decision must still be approved by Parliament, and the contract includes a future option for another 113 vehicles. BAE Hagglunds has filed a legal challenge, amid plans to lay off over 30% of its work force.
Feb 23/09: BAE Systems announces a teaming arrangement with Kongsberg Devotek A/S of Norway to develop a new system of gears and transmissions for the 8×8 SEP. Ironically, the firm won a long selection process thanks to its “ability to deliver pre-series hardware within the extremely short project time.”
The partnership requires delivery of a complete SEP system including development, delivery of prototype equipment, and support. There is speculation that the delivery time frame involves trials for Sweden’s APC competition.
April 25/08: The global consultancy firm Frost & Sullivan honors BAE Systems Hagglunds with an Excellence in Technology Award for the design and development of the SEP (Splitterskyddad EnhetsPlattform/ Modular Armoured Tactical System). BAE Release | Swedish FMV release.
April 17/08: At a live firing demonstration in Karlsborg, Sweden, a SEP 8×8 survives 2 hits from RPG-7 rocket propelled grenades, without serious damage.
The test showed off SEP’s Active Armor Concept (AAC) system, using the AMAP-ADS system from ADS GmbH of Lohmar, Germany. The system is similar to concepts like RAFAEL’s Trophy, detecting incoming rockets and destroying them with fired projectiles. Among other things, the tests verified that the system can discriminate small arms non-threats from real threats to the vehicle, a critical issue for any active protection system. BAE release | ADS GmbH release | SEP AAC Demo Presentation [PDF]
March 10/08: BAE Systems Hägglunds in Ornskoldsvik, Sweden notifies its local employment board that it intends to lay off up to 200 employees as part of a restructuring. Some management posts may be reduced in numbers, and yet the company will also be searching for employees to fill new positions in other areas. BAE’s release says that:
“Where possible, every effort will be made to mitigate any job losses through redeployment of employees within BAE Systems. To help employees seek suitable alternative employment, an outplacement support service will be established.”
Additional Readings
* Marine Corps Systems Command, PEO Land Systems – MPC. Notes that the project has been delayed by 2 years, with the RFP now due in 2010. That date has passed without an RFP.
* David Pugliese’s Defence Watch (Sept 7/10) – Answers On The Alligator And The Tactical Armoured Patrol Vehicle (TAPV) Project. Canada’s TAPV is, at this point, the platform’s only live opportunity.
tag: sepapc