When the U.S. Army announced in August that it would be granting its newest contract to built the ultra-reliable and ultra-safe FMTV truck to a new company, workers at the BAE Systems (LON:BA) Plant in Sealy said they were dumbstruck.

The vehicle, which falls in the category of the Army’s Family of Medium Tactical Vehicles, had been built in Sealy for 17 consecutive years. BAE Systems said their vehicle is unparalleled in safety, comfort and reliability.

FMTV | BAE Loses FMTV Contract (click for larger image/slideshow)

Ken Clay, whose son drove an FMTV during his deployment overseas, is now a production manager at the plant. He said, “These vehicles get shot at every day. They get beat up every day. They continue to roll with their missions. They complete their missions. They come back to their base, and — the bottom line is –everybody gets out of the vehicle and they are still alive.”

This pride is evident throughout the plant in Sealy, and it appears to be well deserved. Despite combat encounters with attacking forces, including land minds and improvised explosive devices, the Texas-built FMTV has a reputation for never losing a life.

How the FMTV provides that safety is a closely-held trade secret. A specially-designed and patented armored cab is the trademark of the BAE vehicle, and one they will not even allow to be photographed.

That, in part, is why the workers were shocked when the Army granted it’s 2010 contract for FMTV’s to a company in Oshkosh, Wis., that makes armored military vehicles but that has never made an FMTV. They will be starting from scratch, yet somehow underbid BAE Systems for the $3-billion contract by 10 percent.

Company Manager Dennis Morris said that cost estimate is highly suspicious.

“When someone comes in and underbids us by that much, it really draws into question whether it can be done for that amount,” he said.

For the 3,200 workers in Sealy who now face unemployment in a faltering economy, the decision is a one-two punch. First, their pride in the production of 56,000 safe troop vehicles over the last 17 years is about to become a part of military history. Many also said they worry what will happen to the troops when a newly designed FMTV hits war torn hotspots like Afghanistan in 2011.

“It’s a gut feeling when something like that happens, because you have poured so much into it,” said Harold Robinstein, who said he has worked at the plant since the beginning.

Robinstein said he has been personally thanked by soldiers who survived bombings inside his FMTVs.

BAE Systems is appealing the decision. The appeal questions how the Army could give an unproven FMTV builder such as the Oshkosh company — which only has built one demonstration vehicle — the same ranking in the bidding process as BAE, which has made 56,000 vehicles with a reliability rate of 94 percent.

A task force has also been created to pressure the Government Accountability Office to reconsider. The city of Sealy, as well as the city of Katy, the county, and State Sens. John Cornyn and Kay Baily Hutchison are joining in a concerted effort to pressure the government to reconsider.

“Those are real, good-paying jobs and they are good people. It affects our schools, our economic development …and the 500 million dollars of revenue it puts into the state of Texas,” said Nick Tirey, mayor of Sealy.

Tirey said he encourages the public to write and call their legislators to apply additional pressure in Washington. Meantime, the decision is in the hands of the U.S. Government Accountability Office, which will make its final determination of the FMTV contract in December. If the decision to award the contract to Oshkosh stands, the BAE plant’s only choices will be to refit the factory for another product or close down entirely.