Niche is the name of the game for Finnish companies

12 February 2004

By Henry Wilson, a DSD staff reporter

When you are an European country with a mere five million souls, that is not a member of NATO and has spent much of the last century living in the ominous shadow of the Soviet Union you perhaps don't expect to be at the forefront of defence contracting. However, Finland and its companies are demonstrating that what is lacking in size can be made up for by an eye for a gap, sound technological know-how and sage strategic partnering.

The name in Finland that is synonymous with defence is Patria. The contractor is state-controlled but significantly European giant EADS holds a 27% stake. The company's turnover for 2002 was Euro 232 million, and while this may seem like a drop in the ocean when compared to the likes of EADS and the big US players it shows what can be achieved given realistic targets and sensible consolidation of core competencies.

Much of Patria's recent success has been based around Patria Vehicles, which only concerns itself with defence products and has almost quadrupled its turnover from around Euro 20 million in 1997 to net sales of approximately Euro 95 million last year of which 60% were exports.

The vehicles unit is looking to cash in on a breakthrough deal that will see Poland acquire 690 of its prize product, the Armoured Modular Vehicle (AMV) by 2013. The Polish Army, in the process of beefing up its capability to fulfil its NATO responsibilities, will receive 313 AMVs fitted with the OTO MELARA HITFIST 30 turret, with the remainder to be a mixture of command post, mortar carrier and general purpose variants. Patria is set to deliver the first two vehicles under the contract in June this year with seven more to follow before 2004 comes to an end.


While the Polish AMV contract is a mighty significant win for the Finnish firm, only 50 of the vehicles will actually be made at Patria's purpose-built manufacturing facility in Hameenlina, with the remainder being the responsibility of Polish prime contractor WZMS. As a result, Patria is firmly focused on a number of other armoured vehicle competitions in Europe with Portugal and the Czech Republic examining available armoured vehicle options, while Holland and Germany are still mulling over the future of the Boxer programme now that the UK has jumped ship.

The AMV is one of two projects that Patria has dubbed "global products", that is to say hardware set to take Patria beyond the exposure it has achieved via the EU and providing equipment for UN peacekeeping forces and into the glare of worldwide competition. The other product is the Advanced MOrtar System or AMOS, which has been developed by Patria Hagglunds - a joint venture between Patria and Swedish firm Alvis Hagglunds.

AMOS consists of a 4400 kg turret, produced by Hagglunds, fitted with twin 120mm smoothbore mortars with a automatic loading system and a maximum rate of fire of 26 rounds a minute. The turret can be integrated onto a number of platforms including the CV90, M113 stretched, Combat Boat 90 and, strangely enough, the AMV. As well as being able to unleash its first four rounds in just eight seconds, the AMOS has a Multiple rounds simultaneous impact (MRSI) capability, enabling the system to fire as many as 14 rounds at a given target using varied barrel elevations resulting in the rounds striking the target as if as one.

AMOS is set to be a true revolutionary weapon and has already attracted the attention of the US Army for its Future Combat System (FCS). Shrewdly, Patria Hagglunds sought out a US partner for the pursuit of an FCS contract, and the Scandinavian joint venture has given AAI Corporation the US design rights for the system. Currently AMOS is on the FCS shortlist.

However, the system has also taken to the water like, well a duck. In sea trials in November 2003, as part of the Swedish SSG 120 programme, the AMOS Navy system scored a direct hit on a moving target at a range of 5 km while its seaborne platform was travelling at 20 knots. This is the first time a mortar weapon has achieved a strike of this difficulty and accuracy.

What is impressive about the manner in which Patria is conducting its quest to raise its international profile is the level of awareness of what is and is not commercially viable, or put another way the company and its management is conscious of not over reaching itself. For example, when looking at the level of technology needed for the AMV, Patria looked into the possibilities presented by electric drives. As Heikki Hulkkonen, Executive Vice President of Patria Vehicles explained, "we looked at the future of electric drives but I don't think there are many markets that are ripe for that technology at the moment." This opinion is echoed by Ari Talvenheimo, Director of Engineering for the vehicles unit who said, "All electric vehicles are a future possibility but the components are not commercially available at this time."

Patria is not the only Finnish company with aspirations towards the defence industry. Oy Robonic Ltd is a Tampere-based firm looking to exploit the opportunities that exist within the scope of the current must have defence accessory, the unmanned aerial vehicle (UAV). Robonic, which designs and produces pneumatic launchers for UAVs and aerial targets, is currently part of teams vying for two UK UAV programmes and has signed a Memorandum of Understanding with EADS Dornier for a UK aerial target project.

Robonic is set to supply launchers for BAE SYSTEMS' bid for the UK's CATS programme, designed to provide a transportable aerial target capability for the British armed forces. If the team is successful, Robonic would produce three large, 55 metre long launchers that would be fitted on to supply vessels for maritime use, as well as approximately seven smaller vehicle mounted launchers for land-based applications. The company is also working with Thales on a bid for the UK's Watchkeeper programme.


Of course, pneumatic launchers are not the only method of launching UAVs but Robonic has some sound arguments to recommend its method. The launcher systems that the company have provided to the Finnish defence forces have proved remarkably reliable with only one failure in the first 3,000 launches, which was attributed to human error. "The message we have received from defence personnel is that the launcher is the least of their problems when they go about an operation," said Robonic Managing Director, Juha Moisio. Moisio further argued that this type of launch method is cheaper in the long run than, for example, launching by rocket. These launchers have the tactical advantage of having relatively low logistical requirements as well as being smokeless, and noiseless ensuring easy camouflage of launch locations.

Another company that has benefited from Finland's entry into the EU in 1995 has been truck manufacturer Sisu Auto. Sisu struck up a hugely successful commercial partnership with French firm Renault in 1997, which not only has seen Renault receive a massive boost in sales in Finland, but has led to Sisu landing a contract to supply the French Army with a fleet of 110 Sisu Tank Carriers. The heavy-duty three-axle Sisu 480 E-Tech 6x4 tractors are equipped with 12 litres 353 kW (480 hp) Mack engines and are designed for the transportation of 50 ton tanks.

While Finland does not have the resources to compete with larger nations across the board of defence products, the technological background of its industry, led by the country's considerable expertise in telecommunications, and the extreme nature of its climate mean that Finnish firms can punch above their weight in certain areas. They therefore represent a group that deserve the interest of larger firms looking for reliable partners.

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