A £390 million deal to provide armoured vehicle support will create 250 new jobs in Wales, David Cameron has announced.
General Dynamics (GD) will maintain Scout specialist vehicles that will be the "eyes and ears" of the army on the battlefield under a contract that runs until 2024, the Prime Minister said.
It follows the announcement on the eve of the Nato summit in Wales last year that the Government would buy 589 of the fully digitised fighting machines complete with miniature cannons.
GD, which is also building the vehicles, has decided to shift some of the assembly work from Spain to Wales as well.
Mr Cameron, who was visiting Wales, said: "Today's decision by General Dynamics to bring the assembly of these world-class armoured vehicles to South Wales is to the credit of the skills and expertise in the local area.
"The 250 additional new skilled jobs at GD will build on those already safeguarded by the decision to purchase 589 Scout vehicles for our armed forces, ensuring our servicemen and women have the very best equipment to keep us safe."
The vehicles will be able to perform in the most difficult terrains around the world and the services provided under the deal will be carried out at a regenerated former fork lift truck facility in Merthyr Tydfil.
Ministry of Defence facilities at St Athan in Wales could also be opened up in a bid to attract luxury car manufacturer Aston Martin.
Mr Cameron said: "As we set out on Tuesday this week, we also want to do more to release public sector land to create new opportunities for hard-working people.
"Here in Wales, I think there is real potential to vacate Ministry of Defence land at St Athan and we're willing to make that available as part of efforts to persuade Aston Martin Lagonda to manufacture their new prestige SUV in the UK."
Welsh Secretary Stephen Crabb said: "This is an enormous vote of confidence in the Welsh workforce and will provide a huge jobs boost for Merthyr Tydfil.
"The Welsh manufacturing sector is going from strength to strength and I am delighted that we have been able to work with General Dynamics to make this deal happen.
"Across the country, we are rebalancing the economy, attracting new businesses to Wales and supporting them to succeed here."