Allison Transmission Holdings, Inc. (NYSE: ALSN) announced a $250 million contract with BAE Systems Hägglunds to supply 4040 MX™ transmissions for the CV90 MkIV infantry fighting vehicles. The agreement, signed June 16 at the Eurosatory defense exhibition in Paris, includes an option for additional units valued at $50 million.

According to the company, the deal represents the largest single tracked defense program contract in Allison Transmission's history. Production deliveries are scheduled to begin in 2028.

The CV90 MkIV program is the first production platform for Allison's 4040 MX transmission, which the company describes as an evolution of its existing 3040 MX model. The new transmission offers increased power ratings and updated electronic controls while maintaining the same physical footprint as its predecessor, enabling integration with the vehicle's Scania engine. Allison said it conducted two years of integration testing with BAE Systems Hägglunds prior to the agreement.

Tommy Gustafsson-Rask, President at BAE Systems Hägglunds, said the contract "highlights our mutual commitment to providing robust solutions that meet the evolving operational requirements of the armed forces."

Indianapolis-based Allison Transmission manufactures transmission and propulsion solutions across sectors including defense, infrastructure, and transportation, operating in more than 150 countries.