But officials at the MoD stressed that the German marque stood as good a chance as any other manufacturer when the light utility fleet is replaced.
It will announce its vehicle requirements to the industry next year before inviting manufacturers to battle for the business.
In national newspapers last week, it was claimed the Land Rover, which has carried British troops into action for the past 50 years, was likely to lose out to the Mercedes-Benz G-wagen, specifically designed for military use and favoured by many other European countries.
A spokesman for the Ministry of Defence told Fleet NewsNet: ‘We are looking at our utility vehicles as part of a long-term project. We will specify our requirements, which we are working on at the moment, to say exactly what we want these vehicles to do in the next 10 years.
‘We will go out to the whole industry so to say we are just eyeing up Mercedes-Benz is untrue. The first of these vehicles won’t come on to the fleet until 2009 so it is a long way off.’
A spokesman for Land Rover declined to comment, saying any contract negotiations were treated ‘in the strictest confidence’.
At this year’s Defence Vehicle Dynamics Show, held at Millbrook earlier this month, vehicle manufacturers and support providers were able to demonstrate the latest products and developments.
Nick Fox, programme manager for the Specialist and Utility Vehicles team, said of the vehicles: ‘Light utility vehicles are the backbone of the Army, Navy and Air Force, playing a variety of roles from forward operations in places like Iraq to homeland bases, responsible for the transport of cargo and stores.
‘A fleet of its size and the importance placed on the vehicle means this is a hugely important project for the MoD.’