Thank you for your question.
You're quite correct that the modern battlefield is continually evolving and tragically has become a more dangerous place. Canada has embarked on an overall fleet renewal for the army and upgrading the LAV IIIs is certainly a key part of that renewal. We are taking lessons learned in Afghanistan and elsewhere, embracing new technologies, upgrading the fleet. The upgraded fleet will offer much more protection to the troops, and provide them with additional firepower to successfully complete their missions.
On October 20, 2011, an implementation contract was awarded to General Dynamics Land Systems-Canada to upgrade these vehicles. We accepted delivery of the first upgraded vehicle on January 24 of this year. Initial operational capability is scheduled for later this year. The next steps will be to conduct a comprehensive test and evaluation program to ensure their performance and put in place the necessary logistic support to allow fielding to operational units this fall.
We expect that all 550 LAV IIIs will be upgraded by 2018. The last upgrade project is capitalizing on existing and evolving technology to improve the vehicle's mobility system and the weapons system, in addition to installing more armour.
I'm told that early indications are showing, and we have heard this, that the upgrades are proving more effective than first imagined, and that's certainly a very positive development. To date, the project is on budget and on schedule. Canada's light armoured vehicle III, LAV III, fleet, has served the Canadian Armed Forces in Afghanistan and other areas of operation well. With the upgrades, they will be state-of-the-art combat vehicles that will be used to transport infantry on the battlefield, while providing defence and protection and firepower.
Ultimately, we are using proven Canadian technology and workers to provide a better, safer workhorse—I think you used that phrase—for our army. The total projected cost to deliver the 550 upgraded LAV IIIs is $1.32 billion.