In 1937 the quickly deteriorating international situation urged the Dutch government to speed up its 1936 modernisation programme for the Dutch armed forces. In view of the limited budget available for armoured vehicles, Chief of Staff Lieutenant-General Izaak H. Reijnders decided that most funds should be dedicated to the acquisition of tanks. Therefore the existing number of twelve Swedish Landsverk 181 (named M36 in Dutch service) armoured cars, equipping a single squadron, should only be expanded with a dozen more for a second squadron, two additional vehicles to function as command cars for each squadron, twelve vehicles to provide a platoon of three for the reconnaissance unit, a motorised cavalry Hussar regiment, of each of the four infantry corps and finally ten vehicles to be used as matériel reserve and for training: 36 new armoured cars in total.