Australian Prime Minister Malcolm Turnbull (R) flanked by Chief of Navy, Vice admiral Tim Barrett (L) and Minister for Industry, Christopher Pyne (C) announces that French naval contractor DCNS beat Germany and Japan for a 50 billion AUD (39 billion USD) contract to design and build Australia's next generation of submarines in the country's biggest ever defence procurement programme, in Adelaide on April 26, 2016.
The announcement culminates years of planning to replace Australia's ageing diesel and electric-powered Collins Class submarines, which are due to leave service from around 2026.
/ AFP / James Knowler (Photo credit should read JAMES KNOWLER/AFP/Getty Images)
MELBOURNE, Australia – Prime Minister Malcolm Turnbull launched Australia's long-awaited naval shipbuilding plan on May 16, including the construction of submarines, frigates and offshore patrol vessels, costing A$89 billion (US $66.12 billion), in Australian shipyards.
Turnbull launched the shipbuilding program with Defence Minister Marise Payne and Minister for Defence Industry Christopher Pyne at Osborne in South Australia, where the majority of construction work will take place.
"This is a great national enterprise. This is nation building. This is an end to the boom and bust pattern that we’ve seen with shipbuilding in Australia," Turnbull said. "This is the largest investment in our defense capability of our Navy ever in peace time."
Under the plan, the government will invest in the rolling acquisition of 12 conventionally-powered submarines under Project Sea 1000 (Future Submarine), the continuous build of nine frigates under Project Sea 5000 (Future Frigate) and a follow-on class of surface combats; and a continuous build program for minor naval vessels.
The minor naval vessels build program is already underway with construction of 19 patrol boats to be gifted to Pacific nations under Project Sea 3036, beginning this year at the Austal facility at Henderson in Western Australia. This will be followed by the Offshore Patrol Vessel program for the Royal Australian Navy under Sea 1180 from 2018, initially commencing at the Osborne Naval Shipyard and transferring to Henderson in 2020.
A request for tender (RFT) for the 12-vessel program, valued at $3 billion Australian dollars or U.S. $2.23 billion, was issued to the three shortlisted designers, Damen, Fassmer and Lürssen, in November 2016. A decision is expected shortly.
An RFT for the A$35 billion (U.S. $26 billion) Future Frigate design was released in March, with construction at Osborne to begin in 2020. The three shortlisted ship designers are BAE Systems (Global Combat Ship), Fincantieri (FREMM) and Navantia (F100-derivative).
The A$50 billion (U.S. $37.15 billion) Future Submarine project will acquire twelve DCNS Shortfin Barracuda 1A submarines, based on the French Navy’s nuclear-powered Barracuda. Construction of the boats will also be undertaken at Osborne, beginning in 2022.
Prime Minister Turnbull also announced an A$1.3 billion (U.S. $960 illion plan to upgrade infrastructure at Osborne and Henderson, which will include new cranes and heavy lift capability, welding stations and upgrades to workshops and storage facilities.
The shipbuilding workforce is expected to grow to over 5000 by the middle of the next decade and a Naval Shipbuilding College will open its doors in early 2018 to expand and develop the pool of skilled workers.
"We will transform our naval shipbuilding and sustainment industry here in Australia, with Australian workers, in Australian shipyards, using Australian resources," Turnbull said.
"We believe that historically we have been too much of a customer and not enough of a supplier for our own defense capability needs," he continued. "That is the big strategic objective. I believe that it not only secures the capabilities, the physical assets, that our Defence Forces need, but also it secures our economic future, our industrial future, by having the skills and the industries that enable you to deliver the products of these advanced manufacturing processes in the defense sector right here. It has spill-over benefits into other industries and sectors and industries."
The formal launch of the shipbuilding plan has been welcomed by industry, with Navantia Board Member (and former head of Australia’s Defence Materiel Organisation) Warren King describing naval shipbuilding as a ‘key pillar’ of Australia’s industrial base.
"Modernizing the Royal Australian Navy’s fleet has to be a key priority of our domestic shipbuilding industry but the export opportunities that will flow in the future are particularly exciting," he said. "This really is a once in a lifetime opportunity for Australia’s shipbuilding industry."
However some analysts believe the timetable for construction of the three types of vessel is overly optimistic. Speaking at the launch of the shipbuilding plan, Minister for Defence Industry Christopher Pyne said that the timetable was ‘tight’ but ‘achievable’ and he said he was confident that it could be met.
Andrew Davies and Mark Thomson, analysts with the Australian Strategic Policy Institute (ASPI), aren’t so sure, noting in a recent blog that the in-service date of the first Future Frigate in particular is one- to four-years later than the RAND shipbuilding report, upon which the government’s plan is based.
"It looks as though the rumored late start to the frigate program has been quietly slipped into the plan," they noted.