Hanwha Defense Australia, a subsidiary of South Korean defense firm Hanwha Aerospace, has been selected as the preferred bidder for the Australian government’s LAND 400 Phase 3 Infantry Fighting Vehicle (IFV) program. The company’s Redback IFV was chosen over Germany’s Rheinmetall Lynx KF41 IFV for the $4.8 billion contract. This acquisition program, designed to replace the Australian Army’s fleet of M113 armored vehicles that were introduced in the 1960s, will involve the procurement of 129 new IFVs.

Upon contract finalization, the Redback is slated for production at the Hanwha Armored Vehicle Center of Excellence (H-ACE) in Geelong, Victoria, Australia. This deal would be South Korea’s second ground-based military equipment export to Australia, following the supply of K9 Thunder self-propelled howitzers in Dec. 2021. This move will likely bolster defense capabilities and regional arms industry cooperation between South Korea and Australia.

Why It Matters

The Australian government’s decision to replace its M113 armored vehicles with Hanwha Defense Australia’s Redback Infantry Fighting Vehicles (IFVs) signifies a shift in its defense strategy and procurement approach. Initially, the tender called for the supply of 450 next-generation IFVs. The Australian government reduced that number by more than two-thirds after publishing its Defense Strategic Review in April in a bid to channel funds toward other capabilities, including guided missiles and unmanned systems.

South Korea’s reputation in the global defense market will likely enhance further with this deal. The ROK swiftly delivered the first shipment of tanks and howitzers to Poland in December — mere months after their defense deal was finalized. This past success could have contributed to Australia’s confidence in selecting Hanwha as a partner, potentially impacting future collaborations and standing in the defense market.

However, there are risks associated with this project, primarily due to Australia’s expanding defense commitments. Some analysts question the relevance of IFVs in the Indo-Pacific security environment, suggesting that Australia’s defense spending might be better allocated elsewhere. Additionally, Australia has committed to a substantial naval acquisition program — nuclear-powered submarines. With an estimated total cost of $368 billion through the 2050s, AUKUS-related expenditures will dominate the Australian defense budget for the foreseeable future. This could divert resources and focus away from the Redback IFV project, potentially leading to project delays and cost overruns.