Challenger 2 is an evolutionary development of Challenger 1 with many improvements as dictated by experience with the design. The Chobham armour is uprated and a new turret fitted.
The L30 gun has improved durability over the L11, being rated at 240 high pressure rounds (- doesn't sound very many, does it).
The Challenger 1 was developed from the Centurion and Chieftain line of tanks, originally intended, as the Shir Iran 2, for use by the (pre-revolution) Iranian army. Subsequently it was developed for the British army as the Challenger. The main improvements over the Chieftain are a more powerful (diesel) engine (1200bhp at 2300) and Chobham armour.
"Chobham" armour was developed at the Fighting Vehicles Research and Development Establishment (FVRDE) at Chobham UK but first used in production on the American M1, in service from 1980. It is a form of spaced armour that, rather than an air-gap, includes non-metallic material, giving good resistance to both armour piercing projectiles and also shaped charges.
The Challenger also features a high-powered 4-stroke V12 diesel engine by Rolls Royce, and hydrodynamic suspension.
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