The Canadian government has decided to cancel the second phase of a competition aimed at providing the army with light utility vehicles. Instead, they plan to invite a limited number of Canadian suppliers to bid directly, according to information obtained by CBC News.

Public Services and Procurement Canada (PSPC) released a notice late Friday indicating that the government will shift to a revised procurement approach. The notice obtained by CBC News reveals the cancellation of the invitation for companies to qualify for bidding on the Light Utility Vehicle (LUV) program, which has an estimated value of up to $4.9 billion as stated on the Department of National Defence website.

Six primary competitors were initially identified for the program, including two U.S. companies – AM General and Oshkosh Defence, and four Canadian companies – Armatec Survivability Group, GM Defense Canada, Roshel, and Terradyne Armoured Vehicles. The government now plans to further narrow down the field.

The Prime Minister’s Office highlighted the shift towards favoring Canadian suppliers in a statement released at the conclusion of the NATO summit. The statement mentioned the intention to limit the tender to two Canadian defense industry suppliers for the delivery of 1,600 to 2,100 vehicles and 400 to 500 light utility trailers for the militarized segment of the Canadian Armed Forces’ fleet.

The specific Canadian companies that will be selected for the project remain undisclosed. The decision to exclude foreign bidders was made just before the NATO summit in Ankara and following the announcement to purchase 12 submarines for the navy from German shipbuilder ThyssenKrupp Marine Systems (TKMS).

The refocusing of the LUV program is aimed at strengthening Canada’s defense industrial base, as highlighted in the PSPC notice. Additionally, the government announced a separate $800 million contract with Norwegian company Kongsberg Defence and Aerospace for the acquisition of joint strike missiles (JSM), designed for advanced anti-ship and land-attack capabilities.

Furthermore, an agreement was reached regarding the Defence Department’s Enhanced Satellite Communications Project – Polar (ESCP-P) to utilize the Telesat Lightspeed system for providing continuous military satellite communications in the Arctic. The ESCP-P program is estimated to have a value of up to $5 billion, according to official sources.