TANK maker Alvis Vickers has safeguarded its immediate future by winning a £200m contract to build armoured vehicles for the British Army.

The Newcastle firm fought off competition to supply the Future Command and Liaison Vehicle.

Alvis Vickers will build nearly 500 of the all-terrain troop carriers, which are capable of withstanding small-arms fire and are light enough to be carried by aircraft.

The company, which employs 450, will install weapon stations, armour packs and communication systems inside the vehicles, which will be used in a wide range of command and liaison roles, replacing a variety of older vehicles.

The demonstration phase of the programme will run until 2005, and a run of deliveries will take place between 2006 and 2009.

The Ministry of Defence (MoD) also announced yesterday that it would not be continuing with the Multi-Role Armoured Vehicle (MRAV) programme into a production phase because the vehicle was no longer considered suitable for the changing requirements of the British Army.

The MoD is in the process of launching a project for a new type of light/medium armoured vehicles known as the Future Rapid Effects System (FRES), which will take on some of the roles previously foreseen for MRAV.

Alvis Vickers said it is well placed to play a leading role in the £1.5bn project which will further strengthen the long-term future of the plant.

Alvis Vickers was formed last October when Alvis bought its Newcastle rival, Vickers, for £16.2m.