Military chiefs want hundreds of the eight-wheeled vehicles to spearhead a new rapid deployment force. Sources say the Ministry of Defence has ruled out a competitive bidding process, meaning British firms will miss out on the chance of landing the lucrative contract.

The new Mechanised Infantry Vehicles will replace Britain’s ageing Scimitar armoured cars – in service since the 1960s.

The Army wants up to 800 but the process of getting them into service has been dogged by delays.

Defence sources say generals are so desperate to see the new unit up and running they are willing to bypass the traditional tendering process because it would be quicker, despite costing more.

It is thought the MoD is poised to place an order with German consortium Rheinmetall for a vehicle known as the Boxer.

Several types of armoured vehicle are available from manufacturers around the world but buying overseas would mean jobs at Britishbased defence companies such as BAE Systems, Lockheed Martin and General Dynamics, and their UK supply chains, would be put at risk.

A military source told the Daily Express: “It has been heavily rumoured that the Government will buy Boxer from Germany and British industry is concerned it won’t get a chance to compete.

“Defence ministers have had repeated opportunities to say in the House of Commons that this will be openly competed but they seem reluctant to do so. When the defence budget is under such pressure, why would you not want to compete the programme and let British industry save the Government hundreds of millions of pounds?”

There have been several attempts to hold a competitive tender to upgrade Britain’s armoured fleet in the past 20 years but each has failed.

The Boxer was rejected by the Army in 2003 and 2008 but is now thought to be the favoured option.

Each would cost at least £4million but other types of vehicle are believed to cost considerably less. Dr Julian Lewis, chairman of the Commons Defence Select Committee, has written to Harriett Baldwin, Minister for Defence Procurement, demanding answers.

He has asked for clarification on “whether the MoD would welcome bids for the prime contract from UK manufacturers and whether the department accepts there is a UK industrial capability to build these platforms”.

Tory MP David Davies, chairman of the Welsh Affairs Select Committee, said: “This is a multibillion pound contract which will support thousands of jobs so we should do everything possible to ensure those jobs stay in Britain.

“At the very least companies like General Dynamics, based in Wales, should be given every opportunity to compete for the tender to build these vehicles.

“Given its importance to South Wales, I have already raised the issue with the Defence Procurement Minister and I am seeking a meeting with Defence Secretary Gavin Williamson.”

It is understood a decision will be made early this year.

Defence chiefs want to see two strike brigades operational by 2025, despite an estimated £20billion hole in military spending plans.

An MoD spokesman said: “No decision has been taken at this stage and our approach remains to encourage open competition wherever possible.”