In 1967, funded by the U.S. Army, the FMC corporation produced two prototype vehicles designated as XM765, based on their experiences earlier XM701 vehicle, developed for the MICV-65 programme. The XM765 was based on the M113A1, upgraded with an enclosed turret and firing ports, so that the infantry could fight from within the vehicle. The Army evaluated the vehicle, but decided that they wanted a better protected and more mobile vehicle,[1] selecting instead the M2 Bradley.
FMC continued development as a private venture resulting in the product improved (PI) M113A1 in 1970....The vehicle would later be designated the AIFV (armored infantry fighting vehicle)... After a series of demonstrations and the delivery of four evaluation vehicles in 1974, the Netherlands government placed an order for 880 of the vehicles in 1975, which were designated YPR-765 when they entered service. In total the Netherlands ordered 2,079 of which 815 were produced locally under license.