As part of Canada’s defence policy, Our North, Strong and Free, the Government of Canada is committed to supporting members of our Canadian Armed Forces (CAF) with the modern equipment they need to complete their missions and keep Canadians safe. The Honourable Jean-Yves Duclos, Minister of Public Services and Procurement, and the Honourable Bill Blair, Minister of National Defence, announced that the federal government has awarded a contract to KNDS Deutschland GmbH & Co. KG (KNDS) for the long-term sustainment of the Leopard 2 Family of Vehicles (FoV). The Leopard 2 is the main battle tank of the CAF. Ensuring our fleet has a consistently high level of operational availability for Canada’s military operations is essential to our national security. The contract is for an initial period of 6 years and 7 months, and includes 4 option periods that could extend the contract until March 2036. The contract has an estimated value of $2 billion (including taxes). In addition to providing crucial services to the fleet, KNDS will establish a Regional Maintenance Centre located near Edmonton, Alberta, and undertake business activity in Canada as part of the Industrial and Technological Benefits (ITB) Policy. KNDS’ economic commitments are estimated to create or maintain 295 well-paying jobs annually in the Canadian economy and contribute a total of $32.5 million annually to Canada’s GDP over the initial contract period.
“Today’s announcement underscores our government’s commitment to providing the Canadian Armed Forces with the equipment they need, while ensuring long-term economic benefits for Canadians. Through the application of the Industrial and Technological Benefits Policy, we aim to ensure this procurement will advance Canadian innovation in our world-class defence industries, create high-value jobs and contribute to economic growth in Canada.” the Honourable François-Philippe Champagne Minister of Innovation, Science and Industry said.
“This interim measure to sustain our Leopard 2 Family of Vehicles is a welcome and important step to ensure that we can continue to conduct operations and train effectively, while concurrently planning for the future mobility and firepower requirements of the Canadian Army,” Lieutenant-General Michael Wright, Commander of the Canadian Army said.
“The Government of Canada is committed to providing members of our Canadian Armed Forces with the necessary equipment to carry out missions and protect Canadians. Today’s announcement underscores our commitment to meeting North Atlantic Treaty Organization requirements, while ensuring economic and security benefits for Canada.” the Honourable Jean-Yves Duclos, Minister of Public Services and Procurement said.
“Through our defence policy update, Our North, Strong and Free, we are providing the Canadian Armed Forces with the necessary equipment to maintain a ready and resilient defence force. As Canada’s main battle tank, the Leopard 2 vehicles are an essential part of the Canadian Army. This new sustainment contract is an important step in ensuring the long-term availability of our Leopard 2 Family of Vehicles, allowing them to continue supporting Canadian Armed Forces operations now and into the future.” the Honourable Bill Blair Minister of National Defence said.
The Leopard 2 Family of Vehicles (FoV) serves as the backbone of the Canadian Armed Forces’ (CAF) main battle tank (MBT) capability, as well as that of several NATO member countries. This family includes not only the iconic Leopard 2 tanks but also a range of support vehicles, such as the Armoured Engineer Vehicles (AEV) and Armoured Recovery Vehicles (ARV). Together, they form an integral part of Canada’s heavy-armoured assets, capable of supporting a wide variety of military operations. Designed for modern warfare, these vehicles offer unparalleled advantages in mobility, firepower, and survivability, ensuring that Canadian and allied troops can effectively dominate the battlefield. Currently, the CAF operates a fleet of 103 Leopard 2 vehicles spread across five different variants, each tailored for specific operational needs. In addition to their heavy armour and protection systems, all variants of the Leopard 2 MBT—such as the Leopard 2A4, 2A4M, and 2A6M—can be outfitted with mine roller attachments, a crucial feature used to clear mines and other explosive hazards during patrols, enhancing operational safety and effectiveness.
The main battle tanks are expected to remain in active service until at least 2035, playing a pivotal role in Canada’s defense strategy. The long-term sustainability of this fleet is now ensured by a strategic contract with KNDS, a European defense company with deep expertise in maintaining and upgrading the Leopard 2 FoV. As the sole entity with the necessary intellectual property rights, technical knowledge, and supply chain access, KNDS has been selected as Canada’s prime contractor for the long-term sustainment of the Leopard 2 vehicles. This contract consolidates multiple service agreements into a single, comprehensive sustainment package that covers program management, vehicle maintenance, technical support, engineering services, and supply chain management. Importantly, a significant portion of these tanks are maintained at a high state of readiness, enabling Canada to rapidly meet its commitments to NATO and other international security obligations. Additionally, the deal aligns with Canada’s Industrial and Technological Benefits (ITB) Policy, including its Value Proposition (VP) clause, which ensures that a portion of the work is conducted domestically. This policy will help foster Canadian industry participation, ensuring local expertise and supply chain resilience for the Leopard 2’s components and systems, securing the vehicle’s operational effectiveness for years to come.
