Challenger 3: Rising to the Challenge

After decades of false starts, the UK Ministry of Defence (MoD) has begun to upgrade 148 of its Challenger 2 main battle tanks to the Challenger 3 standard. With the programme understood to be progressing according to schedule, this article examines the history of the Challenger 3, its technical characteristics, and what this programme says about the wider state of the British Army and the UK’s defence industry.

Arriving more than three years after Russia’s full-scale invasion of Ukraine and amidst intensifying pressure from the Trump administration for Europe to spend more on its defence, the UK Labour Government’s Strategic Defence Review was finally published in June 2025. Advocating for a ‘NATO first’ defence policy, it calls for the British Army to be able to contribute two divisions to NATO, one of which will have three brigades equipped with armoured and mechanised capabilities, as well as their supporting enablers. Yet the British Army’s Challenger 2 main battle tank (MBT) – one of the critical capabilities for these brigades – is an outlier in NATO. Not only is the British Army the sole European user of this vehicle, but it is also the only NATO MBT armed with a 120 mm rifled gun, meaning that it can only be used with proprietary, non-standard two-piece ammunition. Moreover, the Challenger 2 lags behind its NATO contemporaries in other key respects, being underpowered for its weight and deficient in situational awareness. Scheduled to enter service in 2027 and to serve until at least 2040, the Challenger 3 upgrade is a belated attempt to remedy many of these deficiencies and lift the platform to the level of its NATO contemporaries.

A long time in the making

Should the Challenger 3 enter service on time, it will come into the hands of British Army soldiers more than 30 years after the first Challenger 2s entered service in 1994. Whereas its (admittedly older) NATO counterparts such as the Leopard 2 and M1 Abrams have received extensive upgrades across this period, the Challenger 2 has been less fortunate. Although some vehicles were modified during 2003 to improve their suitability for operations in Iraq and a programme was initiated to replace their outdated thermal imagers in 2019, the British Army prevaricated over making a decision on a comprehensive mid-life upgrade for the Challenger 2 until 2021, leaving it more and more outdated by contemporary NATO MBT standards.

This was certainly not a result of a shortage of options – many of the Challenger 3’s upgrades have their roots in earlier programmes that were ultimately cancelled. One of the first serious efforts to upgrade the Challenger 2 was the Challenger Lethality Improvement Programme (CLIP), which started around 2004. With the need to maintain commonality with older Chieftain and Challenger 1 MBTs no longer a factor in the post-Cold War downsizing of the British Army, this project proposed reworking the turret and replacing the rifled gun with a NATO-standard 120 mm L/55 smoothbore gun from Rheinmetall. Deemed prohibitively expensive, this specific programme was cancelled around 2006 and rolled into the more extensive Challenger Capability Sustainment Programme (CSP). Maintaining the switch to the new Rheinmetall smoothbore gun, this also included the installation of the 1,500 hp MTU EuroPowerPack, rectifying another major issue with the Challenger 2: its relatively low power-to-weight ratio.

As austerity took its toll on the MoD’s finances and counter-insurgency remained top of the British Army’s agenda, the CCSP found itself cancelled in 2012 in favour of the much less ambitious Challenger Life Extension Programme (LEP). Focused on obsolescence management, the LEP abandoned earlier efforts to replace the gun and powerpack and instead aimed to digitise the vehicle’s architecture and substitute ageing subsystems such as the sights and fire control system (FCS) for modern alternatives. Two contractors were down-selected in December 2016 to meet this brief: Germany’s Rheinmetall pitted against the Team Challenger 2 alliance formed of BAE Systems Land and General Dynamics Land Systems (GDLS), with the latter’s UK subsidiary having already been chosen to build the new Ajax family of tracked armoured fighting vehicles. In a sign of things to come, both contractors tried to tempt the British Army by fitting their demonstrators with extra capabilities.

First to be unveiled in October 2018 was Team Challenger 2’s ‘Black Night’ prototype, which integrated proven components used on other British Army platforms to reduce development risk and costs. These encompassed new sights for the crew, a new FCS, new gun control equipment (GCE), and an architecture that was compliant with Generic Vehicle Architecture (GVA) standards. However, it was also showcased with an Elbit Systems Iron Fist hard-kill active protection system (APS), showing how the new architecture could accommodate capabilities beyond the LEP’s narrow remit. Rheinmetall’s demonstrator shown in January 2019 pushed the envelope even further by once again proposing to fit its NATO-standard 120 mm L55 smoothbore gun mounted in a newly designed turret.

Despite the new gun not being a requirement for the LEP, Rheinmetall’s efforts to tempt the British Army to reconsider the scope of the LEP appear to have worked, as the programme evolved into the more extensive LEP+, which combined the obsolescence management of the original LEP with the addition of a new gun as championed by Rheinmetall. This also coincided with a major industrial development that saw Rheinmetall buy a controlling stake in its competitor BAE Systems Land, resulting in the formation of the Rheinmetall BAE Systems Land (RBSL) joint venture company in July 2019 and the upending of the LEP competition. With the British Army’s requirements now aligned with industry’s vision, the Defence Command Paper published in March 2021 announced that an upgrade of 148 of the British Army’s 213 Challenger 2s then in service would be funded by a GBP 1.3 billion investment. Shortly afterwards, RBSL was awarded a GBP 800 million to carry out the upgrade of 148 Challenger 2s, including eight prototypes.

Construction on the initial prototypes had started by January 2022 and the first photographs of the initial prototype were shown at the International Armoured Vehicles (IAV) Conference one year later in January 2023. Remarkably for such a complex and long-coming programme, the MoD announced that the Challenger 3 had passed its Critical Design Review (CDR) in February 2023, one month ahead of schedule. If this momentum continues, the qualification review of the demonstration and trials phase will be passed before the end of 2025, after which manufacturing of series-production vehicles will commence.

 

Strong but slow

As the final product of this extended development process, the Challenger 3 ties together the developmental strands that had been abandoned in earlier programmes such as the CLIP, though some shortcomings remain.

The most noticeable change over the Challenger 2 is the new turret and the new gun. The Challenger 3 will be armed with the Rheinmetall 120 mm L55A1 smoothbore gun, which also arms the Leopard 2A7 and A8 variants. Compared to the standard L55 proposed under the CLIP and CCSP programmes, the L55A1 has a higher chamber pressure, which in turn enables it to fire higher velocity armour-piercing fin-stabilised discarding sabot (APFSDS) projectiles capable of perforating armour with a thicker rolled homogenous armour equivalent (RHAe). This will include the KE2020Neo enhanced Kinetic Energy (eKE) round that Rheinmetall has developed under a government-to-government agreement between the UK and Germany. Rheinmetall received a contract from Germany and the UK to qualify this round in October 2024. KE2020Neo is expected to receive the designation ‘DM83’.

There are several advantages that come with adopting the smoothbore main gun. First and perhaps most importantly, the L55A1 will be compatible with NATO-standard ammunition. This will have the benefits of reducing the cost of developing new ammunition natures and procuring existing rounds, while also improving interoperability with other NATO militaries. Secondly, the ability to employ NATO-standard ammunition such as the DM73 APFSDS round and the DM11 programmable high explosive (HE) round will respectively increase the lethality of the Challenger 2 against armoured targets, and targets such as buildings or emplaced infantry. On the former, this is because the Challenger 2’s rifled gun uses two-piece ammunition that is separated into the projectile and bag charge which must all be loaded separately (technically it also requires a vent tube for initiation of the bag charge, though tankers don’t tend to count this as part of the ammunition, in part because it doesn’t need to be hand loaded). While this arrangement can make it easier to stow the smaller individual parts of the ammunition in the confined space of an MBT, the penetrator of an APFSDS projectile cannot be extended into the charge as it can be with unitary ammunition. Consequently, the length and therefore the density of the penetrator cannot be increased, limiting the potential for increasing its ability to perforate thicker armour.

Similarly, the Challenger 2’s use of a high-explosive squash head (HESH) round and the absence of a conventional HE round for its rifled gun limits its performance against targets that are most effectively tackled by fragmentation. This particular shortcoming has been documented by Ukrainian personnel operating the Challenger 2, as it has become more common for MBTs to be used to engage entrenched infantry or buildings than armoured targets or fortifications such as bunkers. One final advantage of adopting the smoothbore gun is that smoothbore barrels do not wear out as quickly as rifled barrels, easing the logistical burden of supporting the Challenger 3 in the field.

The Challenger 3’s L55A1 gun is housed in a newly-designed turret with new GCE. One of the most prominent features of this new turret is an extended rear bustle, which is used to store 15 rounds of ammunition, the 16 remaining rounds being stowed in the hull. This bustle is isolated from the rest of the turret and equipped with blow-out panels that divert the blast away from the crew, increasing their survivability in the event of ammunition deflagration or detonation.

The survivability of the Challenger 3 against ballistic and blast threats is also enhanced by a series of other modifications. Of these, the most intriguing is the Epsom new modular armour (nMA) that replaces the Dorchester composite armour used on the Challenger 2. Very little detail has been disclosed on this passive armour array, but it appears to consist of modules fitted to the front and sides of the hull and turret, as well as on the underbelly of the hull. Due to its modular design, the armour modules can be more easily repaired, replaced, or upgraded, allowing the protection of an individual Challenger 3 to be tailored to its specific operational environment.

 

Two other notable survivability upgrades that reduce the likelihood of a threat impacting the vehicle in the first place include the Elbit Systems Enhanced Laser Warning System (ELAWS) and the Rafael Trophy Medium Variant (MV) hard-kill APS. Comprising four laser warning receiver (LWR) panels mounted on the turret sides and a central control unit, the ELAWS provides a warning to the crew when the vehicle is lased, allowing them to deploy obscurant smoke and/or take evasive action. Also mounted on the turret, the Trophy MV typically contains four radar panels and two effector launchers, which can detect and intercept incoming projectiles such as anti-tank rockets and anti-tank guided missiles. Rafael also claims to have modified the software in the Trophy system to enable it to detect and intercept unmanned aerial vehicles (UAVs), although the ability of the system to neutralise threats employing a lofted attack trajectory such as top-attack ATGMs is uncertain, but understood to be limited to certain angles. However, it is important to note that integration of the Trophy MV into the Challenger 3 remains a work in progress and it has yet to be seen fitted to a prototype, with Rafael having received a GBP 20 million (USD 26 million) contract to qualify and integrate the APS in July 2023. Furthermore, only 60 Trophy kits are expected to be purchased for the Challenger 3 for use in high-intensity operations, with the rest of the tanks delivered in a ‘fitted-for-but-not-with’ configuration.

The Challenger 3’s capacity to accommodate such subsystems that demand more power from its electrical system is enabled by a new digitised architecture that is compatible with GVA standards. By standardising various electrical interfaces, this makes it easier for new subsystems to be integrated into the vehicle. One of these systems was expected to be the Morpheus tactical communications system, but the cancellation of Evolve to Open (EvO) – a key component of the Morpheus programme – in December 2023 indicates that Challenger 3 will use the Bowman ComBAT Infrastructure and Platform (BCIP) 5.6 communications system and its subsequent iterations. In addition to the communications, the sighting systems used by the driver, gunner, and commander will also be replaced with systems common to the Ajax family of AFVs.

Most significantly, the commander will receive the Thales Orion stabilised panoramic sight. Equipped with a day camera, thermal imager, and laser rangefinder, this provides the crew with a significant uplift in situational awareness, as the commander of the Challenger 2 had to make do with a fixed sight that did not have an independent night vision system. This made the commander reliant on a feed from the gunner’s thermal imager and restricted their ability to independently survey the battlefield, hampering hunter-killer operations. Similarly, the gunner’s sight will be replaced with the Thales DNGS T3 forward-facing stabilised sight that is equipped with a day camera, thermal imager, and laser rangefinder. Both of these sights will incorporate Thales’s Signal Processing System (SPS), an automatic target tracking system that can alert the crew to potential threats or targets. The driver will benefit from a Rheinmetall Trailblazer camera system containing a low-light camera and a thermal imager. The feed from this system will be projected onto an Embedded Image Periscope (EIP) from G&H, which allows the driver to quickly switch between the digital image from the camera system and the direct optical view from their glass periscope.

Yet notwithstanding these significant upgrades, the lacklustre powerpack will remain the Achilles’ heel of the Challenger 3, particularly as the new subsystems could increase its weight beyond the approximately 75,000 kg of the Challenger 2 in its heaviest configuration. Prior to undergoing the Challenger 3 upgrade, the Challenger 2s slated to receive the upgrade will have their automotive components overhauled as part of the separate Heavy Armour Automotive Improvement Programme (HAAIP). This refresh involves rebuilding the 1,200 hp Perkins (now Caterpillar) diesel engine to the CV12-9A standard, refreshing the transmission, replacing the existing hydropneumatic suspension units with third-generation Horstmann Hydrogas (also hydropneumatic) suspension, replacing the hydraulic track tensioner, and installing a new cold-start system. However, despite reports in some media outlets to the contrary, this programme does not involve uplifting the powerpack to the 1,500 hp standard found in most other NATO MBTs. This would require an extensive redesign of the cooling system, a risky and costly endeavour that is beyond the scope of the HAAIP. This means that the Challenger 3 is destined to remain underpowered compared to its peers (see Table 1), limiting its battlefield mobility.

 

Table 1: Power-to-weight ratios of select NATO MBTs
MBT	Power-to-weight ratio (hp/tonne)
Challenger 2	16.0
Leopard 2A8	21.7
Leclerc XLR	24.0
M1A2 SEPv3	22.3
Note that these figures are representative, as figures for the weight of MBTs can sometimes vary depending on configuration, and between sources.

 

Too little, too late?

While the Challenger 3 programme does appear to provide a much-needed upgrade to the Challenger 2’s technical capabilities, looking beyond the technological perspective raises difficult questions about the viability of the British Army’s tank fleet and its utility in a conflict involving NATO.

Most critically, only 148 Challenger 2s will be upgraded to the Challenger 3 standard. Although care should be taken when extracting general lessons from one conflict, the Russo-Ukrainian War is a reminder that a protracted high-intensity war against a peer-level opponent such as Russia will ultimately involve large losses of MBTs and other materiel. The Russo-Ukrainian War also suggests that losses will be amplified if – like the British Army – the force lacks a cohesive short-range air-defence network capable of protecting equipment against cheap unmanned aerial vehicles (UAVs). Even though the British Army is unlikely to field its MBTs in such a conflict without the support of its NATO allies and their much larger MBT fleets, the relatively small number of Challenger 3s available to its armoured brigades does raise questions regarding the Army’s ability to sustain its commitment of providing an armoured division to NATO for any meaningful length of time, particularly when considering that a portion of tanks will need to be held for training and only a fraction will be equipped with the Trophy MV APS. This is exacerbated by the fact that the Challenger 2 is slated to only begin entering service in 2027, meaning that the fleet may not even be at full strength before the most pessimistic estimates indicate that Russia may have been able to regenerate its combat power to a level sufficient to threaten NATO.

These concerns regarding mass also extend to the Challenger 3’s supporting enablers, including the related Titan armoured vehicle-launched bridge (AVLB), Trojan armoured engineering vehicle (AEV) and Challenger Armoured Repair and Recovery Vehicle (CRARRV). Without the support of these vehicles, the British Army will face challenges in manoeuvring the Challenger 3 into favourable terrain and recovering damaged or abandoned vehicles. The British Army will therefore need to make sure that corresponding efforts to maintain and overhaul them are implemented quickly, or the operational effectiveness of the Challenger 3 fleet will be hampered. This may be complicated by the fact that these vehicles have limited commonality with the Challenger 2 and 3, as they are based on unique hulls.

The British Army’s struggles to articulate a coherent force structure will also have a negative impact on the operational effectiveness of the Challenger 3. Having cancelled the Warrior Capability Sustainment Programme (CSP) in 2021, the British Army has been forced to rely on the obsolescent Warrior infantry fighting vehicle (IFV) to support its mechanised infantry. With this due to leave service in 2030 and no firm commitment to procuring a replacement based on the Ares variant of the Ajax platform, there is a real danger that the Challenger 3 will find itself operating alongside infantry without an appropriate IFV. Since MBTs often rely on infantry to identify and neutralise threats such as anti-tank guided missile (ATGM) teams, this deficiency could seriously impair combat operations involving the Challenger 3.

 

On an industrial level, the Challenger 3 upgrade may also be a case of too little, too late. As with the case of the Boxer 8×8 wheeled AFV, the decision to delay the implementation of these programmes has rendered it difficult to sustain sovereign AFV manufacturing, with the result that the Challenger 3 is now dependent on a majority German-owned company to deliver this capability. Worse still, it is difficult to see how the expertise and manufacturing capacity set aside for the Challenger 3 will be sustained after the final vehicles are delivered, unless the British Army decides to fund additional upgrades. The only other Challenger 2 operator is Oman, which operates just 36 vehicles, and it is unclear whether the Omani Army is interested in upgrading its fleet. Although the UK MoD and RBSL have claimed that it would be possible to export the Challenger 3’s turret for use on other platforms, it is hard to imagine which markets they have in mind, as the effort to take on the risk of funding integration into a new platform is unlikely to be an attractive proposition.

Britain’s last tank?

Considering all these factors, the arrival of the Challenger 3 will be a somewhat bittersweet moment for the British Army. On the one hand, the upgrade will finally bring many long-coveted developments in firepower, protection, and situational awareness to fruition, although the Challenger 3 will still remain underpowered compared to its peers. On the other hand, the Challenger 3 story is replete with missed opportunities and prevarication, with the result that this uplift is being delivered much later than it could (and indeed should) have been. Furthermore, the small number of Challenger 3s that will enter service raises doubts over the British Army’s ability to uphold its obligations to NATO in any kind of protracted conflict.

The Challenger 3 will also be delivered by the majority German-owned RBSL joint venture, highlighting how British domestic industrial expertise in the AFV sector has withered over the decades since Challenger 2 entered service. With the epicentre of European MBT development now on the continent, the Challenger 3 will almost certainly be the last unique MBT used by the British Army. Perhaps the one silver lining of this otherwise lamentable decline is that the cooperation between British and German industry could put UK industry in a strong position to locally produce a future European MBT such as that envisioned under the Franco-German Main Ground Combat System (MGCS) programme.

Jim Backhouse