National News

Rheinmetall chooses Qld for defence deal

One of the defence manufacturers bidding for a key federal government defence contract says it will build in Queensland if its successful.

Rheinmetall is one of the contenders for the $5 billion dollar contract to build and service Australia's new armoured Land 400 vehicles.

The state government has been wooing the company for the last 10 months, and the company's Ben Hudson said a trip to their headquarters in Germany by State Development Minister Anthony Lynham in May helped seal the deal.

"He personally flew across for a three-hour meeting for me, and that demonstration of commitment really did wonders for the bid," Mr Hudson said.

"Because what we're looking for is partnership, not a transaction, a true long-term enduring partnership and that's what the Queensland government have absolutely showed to us."

The federal government will make a final decision on which company to build its defence vehicles next year.

The other company vying for the contract, BAE Systems Australia, is believed to favour Victoria as their build site.

Premier Annastacia Palaszczuk said she would be happy to work with BAE as well if needed.

"Of course, we want to see as much jobs in Queensland as we possibly can," the premier said.

Liberal National Party Opposition Leader Tim Nicholls welcomed the annnouncement by Rheinmetall, but pointed out LNP members had been advocating on behalf of Queensland already.

If Rheinmetall wins, around 100 vehicles are expected to be based at the Townsville and Enoggerra bases, with the contract predicted to generate 450 jobs and pump a billion dollars into the state's economy.

© AAP 2017