May 8, 2016

DCNS had a good 2015 and 2016 may be even better

The French (DCNS) made version of the French FREMM (multi-purpose) Frigate is known as the Aquitaine class. Delivery of one to Egypt in 2015 and the Languedoc to the French Navy, in March 2016, helped DCNS return to profit in 2015. (Image Courtesy NavalAnalyses.blogspot.com. See larger image here)
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Thales, with a 35% stake in DCNS, is delighted DCNS has won the Australian SEA 1000 Future submarine order. This will boost DCNS and Thales revenue.

Defense News, April 29, 2016 carried information: "France’s share of the prospective deal is €17 billion (US $19.5 billion), according to sources close to defense minister Jean-Yves Le Drian, weekly Le Point reported, while Reuters reported some €8 billion (US $9.2 billion) for DCNS. DCNS chairman Hervé Guillou welcomed the support from the Direction Générale de l'Armement procurement office, Navy chief of staff Adm. Bernard Rogel, Thales, Sagem, and Schneider Electric, a French energy company with a significant business presence in Australia.…[As well as Thales' gaining a share of DCNS' revenue] Thales' share of the Australian program is expected to be some €1 billion (US $1.2 billion), with €100 million ($115 million) per sub based on the sale of sonar systems, electronic warfare and periscopes, a Thales executive said."

The way Thales may benefit may be from its local subsidiary supplying sonars for the (Lockheed Martin versus Raytheon) Combat System for Shortfin. The Combat System Integration (CSI) competition may be decided in July-August 2016.

DCNS delivered a FREMM frigate of the Aquitaine class to Egypt in 2015 and the Languedoc to the French Navy in early 2016. DCNS is also overhauling the nuclear carrier Charles de Gaulle in Toulon. Later in 2016 DCNS is delivering the two Mistral helicopter carriers to Egypt. The Mistrals were previously sold to Russia but blocked by the western arms embargo. The Mistrals will still use Russian communications equipment and Ka-52 attack helicopters.

All this activity and construction of the Barracuda SSNs and work on the Triomphant SSBNs helped generate a 2015 profit for DCNS. DCNS reported a net profit for 2015 of €58.4 million after a loss in 2014 of €347 million. This was on 2015 sales of €3.03 billion compared to 2014 sales of €3.07 billion. 

If DCNS and Australia sign a Shortfin design contract in 2016 profits may even be higher for DCNS.

DCNS sale of 2 Mistrals (previously intended for Russia) to Egypt helped lift DCNS into profit in 2015. The Egyption Mistrals will still use Russian communications equipment and Ka-52 attack helicopters.
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Pete

19 comments:

Nicky K.D Chaleunphone said...

Hi Pete,
France is also pitching the FREMM Frigate to Canada as well.

Anonymous said...

This article gives a breakdown on $$. http://www.defensenews.com/story/defense/2016/04/29/australia-submarine-dcns-france-hollande-turnbull-stitt-davies-germany-japan-tkms-mitsubishi/83713442/

imacca said...

" France is also pitching the FREMM Frigate to Canada as well. "

If we bought FREMM, isn't it more likely we would get the Italian version? I think that has room for two helicopters.

And our FREMM would more likely have CEA radars, SAAB combat system and US VLS and other weapons systems.

Peter Coates said...

Hi Nicky

Hopefully the Franch FREMM will do well in Canada https://en.wikipedia.org/wiki/FREMM_multipurpose_frigate#Canada .

The French FREMM did not make the shortlist for the Australian Future Frigate competition announced April 18 2016 - with BAE Systems Type 26; Fincantieri's FREMM, and Navantia's redesigned F100 short-listed. See http://www.minister.defence.gov.au/2016/04/18/prime-minister-and-minister-for-defence-continuous-naval-shipbuilding/

Regards

Pete

Peter Coates said...

Hi Anonymous [at 9/5/16 4:54 PM]

Thanks for http://www.defensenews.com/story/defense/2016/04/29/australia-submarine-dcns-france-hollande-turnbull-stitt-davies-germany-japan-tkms-mitsubishi/83713442/

I've just placed a couple of paragraphs in the article text.

Regards

Pete

Peter Coates said...

Hi imacca

Yes its the Italian Fincantieri's FREMM that is on the Future Frigate (SEA 5000) for Australia shortlist see http://www.minister.defence.gov.au/2016/04/18/prime-minister-and-minister-for-defence-continuous-naval-shipbuilding/

There has been most focus on Future Frigates for Australia being assessed on their ASW potential - But air warfare and ability to launch land attack missiles (especially in ongoing-perpetual wars in the Middle East) are also major requirements.

With the Italian FREMM being 700 tonnes heavier than the French one all these capabilities are easier packed into the larger Italian solution. see https://en.wikipedia.org/wiki/FREMM_multipurpose_frigate

Also there may have been concern that DCNS would have inordinate market power if it won the Australian submarine AND future frigate competitions.

Regards

Pete

Anonymous said...

The difference in the French FREMM and Italian FREMM are not only due national industrial considerations, but due different contigencies.

French FREMM:

- A single FREMM patrols of the African coast due a situation where French interests are on the line. Orders come in and the FREMM conducts a LACM strike. Operations with German colonial-cruisers aka F125-class frigates are planned/expected.

--> Italian FREMM are fitted for but without LACM.

- A single FREMM ! passively ! patrols areas of interest or follows a OPFOR SSK/SSN.

--> Frenchies are pitching their FREMM to Malaysia and Vietnam.

Italian FREMM:

- A single FREMM encounters a small fleet of migrant-boats/tango-boats/smuggler-boats and is ordered to engaged them.

--> 2 helicopters & 2x 76mm or 127mm + 76mm

- Italian FREMMs go in guns-blazing against a smaller Russian task-force in the Med.

- Italian FREMM conduct naval gun-support with their 127mm/76mm in ops in the Med.


The French FREMM are probably closer to Canadian mission-profiles.

Anonymous said...

"Also there may have been concern that DCNS would have inordinate market power if it won the Australian submarine AND future frigate competitions." =>
And Navantia wouldn't have?

Nicky K.D Chaleunphone said...

Hi Pete,
Check out this article from War is Boring

How Japan Flubbed a Huge Australian Submarine Deal
Tokyo offered an excellent ship — but failed politically
https://warisboring.com/how-japan-flubbed-a-huge-australian-submarine-deal-f4a7dff6c772#.9nwnqlhzv

Nicky K.D Chaleunphone said...

Hi Pete,
The FREMM frigate that I think Canada is looking for is mostly the French Version. The Italian version of the FREMM frigate borders on the light end of a DDG. It's why I think the FREMM frigate is perfect for Canada but For Australia, something along the lines the Spanish F-100 frigate or BAE Type 26 GCS.

MHalblaub said...

LOL, German colonial-cruiser F125-class.

Strange thing is the smaller French FREMMs are close to the German cruisers according to costs.

Also interesting are the inspection intervals for the F125: see German wikipedia.

Regards,
MHalblaub

Peter Coates said...

Hi Nicky [at 10/5/16 4:49 AM]

"How Japan Flubbed a Huge Australian Submarine Deal
Tokyo offered an excellent ship — but failed politically"
https://warisboring.com/how-japan-flubbed-a-huge-australian-submarine-deal-f4a7dff6c772#.9nwnqlhzv

has been republished as

"Why Doesn't Australia Want Japan's Submarines? (Some of Best in the World)" http://nationalinterest.org/blog/the-buzz/why-doesnt-australia-want-japans-submarines-some-best-the-16100

Peter Coates said...

Hi MHalblaub [10/5/16 7:01 AM]

To help fellow commenters please state:

- "the inspection intervals for the F125"

- and what string "in German wikipedia"?

Regards

Pete

Anonymous said...

F125-class colonial-cruiser/peace-keeping-support frigate:

- 2 years operation far away from home-base
- 60 months interval between deep inspections/maintenance
- standard-maintenance in civilian ports possible
- designed for all climate-conditions
- 200 days fuel-supply + food-supply onboard
- just 120 men crew vs. ~ 250 for similar sized ships
- suitable cargo-space/accommodation for 50 men strong detachment of SpecOps/Marines
- for German Navy: 4 ships, but 8 crews
- first-time for German Navy: long-range gun-support + LACM (Harpoons are interim)
- 4x 10m-long dinghies, which all carry HMGs + possible RPG-style weapons
- no ASW-suite, but longe-range radars

Those mission-set/specs and planned usage are very similar to 19th century Colonial Cruisers.

Regards,
Team Eurowussies

MHalblaub said...

ASW will be integrated after the first refugee or pirat submarine is portrait by BBC on TV.

Peter Coates said...

Hi Team Eurowussies

Too bad that the shortlist for the Australia Future Frigates is:
- BAE Systems with the Type 26 Frigate;
- Fincantieri with the FREMM Frigate, and
- Navantia with a redesigned F100.

see http://www.minister.defence.gov.au/2016/04/18/prime-minister-and-minister-for-defence-continuous-naval-shipbuilding/

Regards

Pete

Peter Coates said...

Hi MHalblaub [11/5/16 8:31 AM]

Certainly Australia's Border and Customs Patrol Boats spend much time on illegal immigrants who pay people smuggler boats launched from Java, Indonesia.

Luckily Australia doesn't have a leader like Merkel who, in 2 short years, has developed "policies" that have made people smuggling a multi $Billion industry across the Mediterranean.

Regards

Pete

Anonymous said...

Hi Pete,

I never considered the F125-class frigate to part as any Australian requirements.

But I am betting my money on the Italian FREMM to win the RAN tender. If an Aussie OPV is not intimidating, a RAN FREMM will be towards Javanese smugglers/Somali pirates. On the other hand it has enough firepower to challenge even the Type-052D DDG of China. (The Type-055 CG will probably outgun anything besides USN's DDG/CG and Russia's modernized Kirovs.)

The F125-class is borne out of studpidity of German political enviroment. In the late 1990s when it became clear that Germany needs LPD/LPH or even a light carrier, the officers & the MIC knew the Joschka Fischer-led Greens (junior ruling-partner) will not approve such kind of "agressive" item.

The F125 is the one-trick-pony to achieve Germany's responsibilty towards the UN.

Most German officers would like to see a commbo of more F124-class FFG and maybe some Mistrals or even Cavour CV.

Peter Coates said...

Hi Anonymous [at 12/5/16 6:23 AM]

Yes all countries have their frustrations on past military purchases (in Australia concerning the F-111 jet and Collins sub). For the future many in Australia wonder whether buying more than 70 x F-35s, rather than just a batch of 24 x F-35s is reasonable.

Regards

Pete