The diagram above is courtesy The Daily Telegraph
August 20, 2015. Note this is based on Defence Teaming Australia advice in mid August 2015, under different Abbott Government conditions. The $17 Billion might be for 8 submarines.
While the promise of 70% of submarine work in Australia has been mentioned by the outgoing defence minister Andrews in Parliament this is not yet a formal commitment. 70% involves complex costings over a 20 year period.
The new Australian Defence Minister, Marise Payne, will be
faced with a highly complex $90 Billion shipbuilding situation.
She and the
whole Australian Federal Cabinet will have to:
- plan, conduct and complete submarine/ship
selections which heavily rely on the knowledge/designs/industrial capacity/contractural clarity of
overseas companies
- decide on political priorities at the federal and
state level (including rewards for past, present, future loyalty to the Turnbull government)
- ensuring votes and jobs at the Turnbull federal and
state levels
- divide shipbuilding work (for submarines, frigates
and patrol vessels) across four major shipbuilding states (South Australia,
Western Australia, Victoria and New South Wales)
- other Australian states and territories will also
need to be given sub and shipbuilding work that they can efficiently do.
More detail on the four majors:
- home of the Australian Submarine Corporation (ASC) in
Adelaide
- ASC's efficiency was/is low as seen in the Collins
build and the current Air Warfare Destoyers build (3 for $10 Billion - so far)
about 200% over the price of highly efficient shipbuilding countries (eg. South
Korea and Spain)
- But politically the votes of the 6 Federal Members of
Parliament from South Australia were essential for Turnbull to become Prime
Minister.
- Industry Minister Christopher Pyne is from South
Australia
- its relatively efficient shipbuilder, Austal, is at Henderson,
south of Perth.
- on September 25, 2015 Civmec, also at Henderson, proposed that it could build the submarines (see artist's conception of an expanded Civmec facility above).
- on September 25, 2015 Civmec, also at Henderson, proposed that it could build the submarines (see artist's conception of an expanded Civmec facility above).
- Henderson is near Australia's main submarine base
HMAS Stirling at Rockingham.
- making Henderson a logical place to assemble
submarines and maintain them.
- But politically that may be impossible, even
though Julie Bishop, a key kingmaker of Turnbull, is from Western Australia.
- Austal's Mobile Alabama shipyard builds the Independence class littoral combat ship.
Victoria
- relatively efficient shipbuilder BAE Systems
Australia is at Williamstown dockyard near Melbourne,
- has a highly efficient
record of building 10 x
ANZAC class frigates
- and more
lately handled the completion of the 2
x Canberra class Landing Helicopter Dock (LHDs)
New South Wales (NSW)
- Forgacs in Newcastle and in Tomago are
involved in ship maintenance and building of ship modules
- Newcastle is in close proximity to Sydney (the main Fleet Base East) and other naval facilities on Australia's east coast such as Jervis Bay (NSW) and several in Queensland.
- Newcastle is in close proximity to Sydney (the main Fleet Base East) and other naval facilities on Australia's east coast such as Jervis Bay (NSW) and several in Queensland.
So the handling of the $90 Billion project, for the submarines, frigates and patrol vessels, is Defence Minister Payne's main challenge and may make or break the Turnbull Government.
Pete
12 comments:
Hi Pete
Corporative submarine building with Austal is an attractive option for Japan. The distance between Perth and Adelaide is nothing for European submarine builders, but is big for Japan. Although naval environment (China, North Korea, Russia) surrounding Japan is much more severe the environment surrounding Australia or Europe, Australia requests tough CEP for Japan and Japan is trying to listen the request. Now, Australian shipbuilders/areas should compete each other for Australian taxpayer. “Politically being impossible” seems to be an excuse. I think that lack of competition is one of the major reasons of Collins’ low performance.
Regards
S
Hi Pete,
You missed one pro for NSW: Newcastle is in close proximity to Sydney (our naval base) and other naval facilities in the east coast such as Queensland and Jervis bay.
Hi S
The Japanese delegation in Adelaide several weeks back was heavily criticised for not providing details or an intention to team with Australian shipbuilders. So your statement of possible Japanese interest in Austal is interesting.
Australia's CEP may be tough for Japan but Germany and France are accustomed to even more difficult customers. Imagine trying to sell subs to:
- Greece, with the likelihood of delay and inability to pay or
- to India with an appalling record of delay, announcement then haggling (eg. for Project 75 which DCNS "won" a decade ago https://en.wikipedia.org/wiki/Kalvari-class_submarine ) or the the https://en.wikipedia.org/wiki/Indian_MRCA_competition#Fate_of_the_deal fighter bomber sale
All countries have lack of competition problems as submarines are big business tending towards monopoly or cartel within a building country.
Regards
Pete
Thanks Anonymous
I've put those details in the text.
Regards
Pete
Hi Pete,
The Daily Telegraph article indicates the cost of (presumably 8 Subs) at 17 billion,
But zee Germans said they could build them for 20 billion. Shouldn’t 8 subs be in vicinity of 14 billion not 17??? Is there a start-up cost involved? And if so how much? Is it an issue of development costs being spread over just 8 boats as opposed to 12?
PS – Any chance of Japan, Germany or France working with the winner of the contract in regards to technologies transfer?? Eg. Maybe Japans new Lithium-Ion batteries could find their way on a U-Boat perhaps?
Cheers
ONeil
Hi ONeil
Yes the $17 billion rather than $14 billion may be due to the high fixed development costs for such a radically new, large submarine, So unfortunately there are not simple unit price reductions. If we were smart we'd buy the $ 1 Billion 218 (for Singapore), but we're not.
Yes depending on who wins the others (and the US) may help the winner with Li-ion batteries, fuel cell AIP and vertical launch etc.
If Canada eventually buys the same sub years later then Canada will get the sub for far less than Australia.
Cheers
Pete
Hi Pete
In the case of LIBs Soryu (28SS) for 30-years operation, the building [1] and operation/maintenance costs per one submarine is estimated to be 0.75 and 0.65 B$(1$=85.1Yen) based on very reliable and realistic life cycle cost analysis annually conducted JMSDF. Total costs of eight 28SSs become ca.11B$.
In the case of next generation Japanese submarine (29SS), the R&D cost will be added. But I do not believe the R&D cost will be very expensive for two reasons. First, significant modifications of shape and structure in 29SS are not expected, because the shape and structure of current Soryus are optimized considering stealth effect in water operation. Second, R&D of following new systems of 29SS were nearly finished: i) adoption of floating decks, ii) improved snorkel generation system, iii) next generation sonar system, iv) next generation torpedo (GX-6).
In the case of 29SS modified for Australia (29SS-AUS), R&D cost [2] of new hull steel for first batch and cost of US-combat system for each batch must be included. Assuming 30% (50%) of price increase by 70% of local procurement, total cost of eight 29SS-AUSs will become 15B$ (17B$). If total cost is higher than 17B$, Japan will decline the tender for Japanese taxpayer.
[1]There is no R&D cost in 28SS.
[2]I estimated ca. 100M$ for 3-years R&D. Annual R&D cost of NS110 was ca. 30M$.
Regards
S
Peter,
Not only should we look at the options before selection but more importantly we should contractually have an option B. This locks in a price, capability (knowns) at no cost and more importantly sends a message that we will not stick by poor performance, cost, schedule because there is a competitor.
Hi S [at September 23, 2015 at 12:35 PM]
If only 28SS or 29SS in Japan configuration had a range of 11,000nm then they would be very competitive. Australia's probably wants an extra 5,000nm range on top of the 6,000nm already used in the 29SS-Japan.
We have discussed earlier NS110 pressure hull steel is not usable if heavy maintenance is done in Australia (with heavy maintenance in Australia probably a CEP requirement). A pressure hull strength equivalent to HY-120 would be interesting.
Costings that assume all hulls are built in Australia and assuming Japan knows how much it would cost to integrate the US combat system, would be most interesting.
Regards
Pete
Hi Joe Black
Yes, I agree.
Regards
Pete
Hi Pete
As JMSDF does not like to lengthen submarine, if there is not significant structure change, the length of SS29 is expected to be as same as the one of SS28, i.e. 84m. If the length of SS29 mod-AUS is 88m (submerged weight = 4500-4600t) for additional fuel and improvement of endurance, extra range of 5000nm is achievable without loss of performance in my opinion. I expect some increase (plus 1-2knot/h) in the snorkel speed for 29SS by scale-up of diesel engine.
The cost of the US combat system integration is not reported, but the cost related to the submarine information processing subsystem consisted of i) computer for calculation on sonar and launch controller and ii) display of target is reported. The cost of the submarine information display for 19SS in FY2014 is 420M\ (5M$,100\=1.19$)|. I am sorry that I cannot reveal the source.
Regards
S
Hi S
"420M\(5M$,100\=1.19$)" is difficult for me to understand.
What is 420M in US dollars?
Regards
Pete
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