September 17, 2015

Turnbull Govt New Policy - 70% Future Submarine to Be Built in Australia

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With the end of Parliamentary Question Time finished in the first week of (Prime Minister) Turnbull's Government some observations can be made.

The replacement of Tony Abbott with Prime Minister Malcolm Turnbull is worrying Japanese submarine sales teams in Adelaide and Canberra. There is concern that understandings to buy the Japanese submarine have now been cancelled.

Turnbull’s diplomatic style and attitude to any alliance with Japan is unknown. Abbott’s sudden closeness to Abe may need to be recreated by Japan.

Turnbull is politically a moderate while Abbott and Abe were kindred conservatives.

Turnbull’s wife, Lucy Turnbull, is powerful in her own right. Her most prominent past role was Lord Mayor of Sydney.

Turnbull's current attitude to the China military threat may not be the same as Abbott’s. The views of Turnbull’s Defence Minister, Kevin Andrews or a replacement, may be more influential. The trilateral Japan-US-Australia alliance (or quadrilateral - adding India) is probably still the informal though not official policy.

It has yet to be confirmed in Hansard (officially recording Parliamentary House of Representatives statements) whether Kevin Andrews, who is still Defence Minister, stated in Parliamentiary Question Time (September 17, 2015) that perhaps 70% to 80% of new submarine work could be done in Australia. If so this may signal a change in policy. Note that the current feeling by industry in Australia is that Australia will order 8 submarines overall – not 12.

[Fairfax, Sydney Morning Herald journalists reported (September 17, 2015) the same Andrews statement:
"I see that one of the bidders has said that they can build a significant part of a submarine here in Australia - some 70 to 80 per cent," Mr Andrews told Parliament. "That means that we're going to have more jobs, a significant part of that build, perhaps 70 to 80 per cent of submarines, built here in Australia." Note the DCNS offer described in the same article.]

Perhaps in Japan’s favour is that Australia still appears locked into using the US submarine combat system - giving the US considerable political, economic and alliance influence over Australia’s choice of submarine.

Japan needs to be prepared for “build in Australia” or at least the Hybrid Build option which may mean 70% build in Australia. The build percentage could conceivably include submarine steelmaking in Australia.

Pete

18 comments:

MHalblaub said...

Dear Pete,

there are several parts of a submarine Australia should not (again) try to build:
- engines
- electric drive
- AIP

Quite in the same manner Turkey is building its Type 214 submarines. The complete drive train and main electrical system is a ship set from Germany.

The rest could be done down under.

Regards,
MHalblaub

Peter Coates said...

Hi MHalblaub

I agree and add if TKMS is to be competitive with a DCNS offer made to the Australian Government today TKMS should plan to build at least the first 216 in Germany. Then at least 70% of the whole build in Australia. See http://www.smh.com.au/federal-politics/political-news/submarines-set-to-be-built-in-australia-under-turnbull-government-20150917-gjpazk.html - a very important article.

Regards

Pete

Anonymous said...

Hi Pete

To tell the truth, it is bothersome.

Regards
S

Peter Coates said...

Hi S

I think is was US pressure-influence that made an Australian purchase of the Japanese submarine almost a necessity.

There may still be renewed US pressure, this time on the Turnbull Government, for Australia to buy the Japanese sub.

What may be new is a "build 70% in Australia" requirement. Within the 70% might be:

- the installation of the US-Australian combat system

- Japanese organised manufacture of submarine steel in Australia

+ assembling 6-7 (of the 8) subs in Australia from Japanese kits.

Regards

Pete

Anonymous said...

Hi Pete

Today “Businessnewsline” reported Japan was extricated from the submarine deal issue [1].

Regards
S

[1] http://www.businessnewsline.com/news/201509180342220000.html

Peter Coates said...

Hi S

Thanks for http://www.businessnewsline.com/news/201509180342220000.html

I also spotted a Japan Today article http://www.japantoday.com/category/politics/view/australia-favors-local-build-for-huge-submarine-deal .

It appears that, even if Japan wins, most of the subs will need to be built in Australia.

Regards

Pete

Anonymous said...

Hi Pete

If the current Australia government behaves wisely, there would be an enough chance to get best 29SS modified for Australia with 70%-80% local building, I think. This is a serious diplomatic failure.

Regards
S

Anonymous said...


Hi Pete

Hi Pete

I find interesting US Congress Report [1] which analyzes comprehensively China naval modernization.

https://www.fas.org/sgp/crs/row/RL33153.pdf “China Naval Modernization: Implications for U.S. Navy Capabilities—Background and
Issues for Congress” by Ronald O'Rourke, Specialist in Naval Affairs

Regards
S

MHalblaub said...

Dear Pete,

why do you think that the new government still wants an US-combat-system?

Regards,
MHalblaub

Peter Coates said...

Hi S [at Sept 18, 2015 10:07PM]

Equally, if Japan Inc is wise, it will act as a seller, like any other company, in true competition with other sellers.

Regards

Pete

Peter Coates said...

Hi S [Sept 19, 2015 7:07AM]

Thanks for US Congress Report https://www.fas.org/sgp/crs/row/RL33153.pdf “China Naval Modernization: Implications for U.S. Navy Capabilities—Background and Issues for Congress” by Ronald O'Rourke, Specialist in Naval Affairs"

That will be useful when I do an article next week on China's activities in the South China Sea.

Regards

Pete

Peter Coates said...

Hi MHalblaub [at Sept 19, 2015 7:45AM]

"why do you think that the new government still wants an US-combat-system?" is a good question.

The RAN is generally conservative, uses the US combat system on the Collins

and has been helping develop that combat system (weapons included) for future use.

My SeaWeb infrasture-database theory also favours a mostly US combat system.

More hardware components from the 3 competitors is possible.

Regards

Pete

Anonymous said...

Hi Pete (September 19, 2015 at 11:22 AM)

I do not intend to criticize only Austria for this deal at all. Japan must be criticized in many aspects such as arrogance, bad communication and lack of consideration for local industries.

Regards
S

Peter Coates said...

Hi S [Sept 19, 2015 1:17PM]

Yes Australia should be criticised for not starting a submarine tender about 3 years ago. The CEP is still probably a bit disorderly and rushed. The CEP also leaves too much room for international political influences to distort the result.

One influence is Australia choosing the US combat system up front. This gives the US too much power to decide who the winner is. The US can decide which country (Japan, Germany or France) the US will be prepared to share its combat system sensitive information with. The US influence - still appears to favor Japan and reputedly not France - with Germany somewhere in between.

Regards

Pete

MHalblaub said...

Dear Pete,

according to the combat system I have to mention a few thoughts.

Australia is accustomed to an US system. The US combat system offers an inherited access to the SeaWeb.

On the other side each submarine type offered has an inherent combat system which fits to the other inherent systems.

So the question is which way is the better solution?
Fit an US combat system into a submarine or fit features of the US combat system into an inherent submarine system.

According to my knowledge the ISUS system uses the consoles for either mission related jobs like sonar tracking or for submarine system related issues like monitoring the engines. Each console can do every job. So an US system needs also to operate the whole submarine.

ISUS seems also very open to implement additional weapons like some bigger Israeli ones. ISUS already is capable to operate with a big variety of torpedoes (Seahake mode 4, WASS A 184, MK 48, ...), missiles like Harpoon, IDAS, Popeye, ... and specific items like TAU 2000 (hard and soft-kill system).

So what would be easier? Implement some SeaWeb features into an existing system with the Australian knowledge of the US combat system or implement all the other things into an US system?

It was also a wrong strategy to chose the US System without any competition. I can imagine the price...

Regards,
MHalblaub

Peter Coates said...

Hi MHalblaub [at Sept 21, 2015 8:58PM]

Thanks - I intend to make your ISUS comments the basis for an article today.

Regards

Pete

Anonymous said...


Hi Pete

In 19/Sept/2015, KBS reported that the latest South Korean submarines had significant noise problems [1, 2].

[1] http://news.kbs.co.kr/news/view.do?ncd=3150541 “Ttaeun 1800 tons of money 'noise' submarine combat deployment”
[2] KBS (Korean Broadcasting System) is national broad caster of South Korea. (Wiki)

Regards


Peter Coates said...

Hi S [Sep 23, 2015 1:40PM] re report noise from German submarine problems this week. Thanks for http://news.kbs.co.kr/news/view.do?ncd=3150541 which seems to suggest some entity is being sued for noise. VW emissions?

Problems S Korea has been having with German designed subs was flagged in this 2013 article reference http://www.thehindu.com/news/national/germans-may-find-it-hard-to-sell-their-subs/article4599258.ece . Maybe noise problems are continuing for S Korea?

Regards

Pete