COST FORMULA
S has made an interesting comment as follows:
“[S] analyzed cost of Soryu based on budget, and [S] concluded that Australia can build and maintain 10 submarines for 30 years (total cost 1,600B Yen) [= approximately A$20 Billion] under a proper management system.
Modification cost of 29SS to Aus 1 [per submarine for Australia] is 5 B Yen [A$62 million].
Adoption cost of US combat system is not high.
Premium [build] cost in Australia is 10B Yen
30years- operation cost is double of building cost.
Life cycle cost for 30 years = {basic cost (65B) +US combat (0B)+ modification (5B)+ premium (10B)}x 2= 160B Yen [= approximately A$2 Billion per submarine]
[S] January 18, 2016 at 1:15 AM”
QUESTIONS AND
COMMENTS
The figures above in square […] brackets are in
Australian dollars where
1B = 1 Billion
Yen = 12.4 million Australian dollars (A$) at January 18, 2016 exchange rates.
Building and maintaining 10 submarines for 30 years (at total
cost 1,600B Yen) [approximately A$20 Billion] appears to be an attractive
all up price.
1. However if:
Building cost is {basic cost (65B) +US combat (0B)+ modification (5B)+ premium (10B) = 80B Yen = aproximately A$992 million
and
"30 years operation cost is double of building cost" = 2 x A$992 million = A$1.984 Billion
Then wouldn't total for "Building and maintaining 10 submarines for 30 years" = A$992 million + A$1.984 Billion = A$2.976 Billion per submarine = approximately A$3 Billion per submarine?
Making Total for all 10 approximately A$30 Billion?
Actually A$30 Billion is much lower than a September 2015 estimate of $40 Billion ($14 Billion "Build" + $26 Billion "Maintain").
2. I assume that the Maintain costs would not include personnel costs for (Navy + Defence civilian) pay and updating Combat System costs?
Electro-optic mast, 13m Periscope, Submarine sonar system, Jamming system, Radar system, 53cm Torpedo tube, Harpoon launching system, Submarine decoy, Sound device for submarine decoy
[Upgrades to Torpedo and Harpoon missiles? (1.5B)]
Communication System (0.4B yen):
Radio communication device, Secure &Encryption device, Bridge information display, Submarine signal flare, Antisubmarine morse signal, Rescue signal generator for submarine
Propulsion, [LAB] Batteries, Generators and Building Costs (40B yen):
ADDITIONAL DATA - FURTHER
EXPLANATION OF THE FORMULA FROM S
On January 19, 2016 S provided further comments:
On January 19, 2016 S provided further comments:
LCC, Software
and Labour Costs etc
“Life
cycle cost (LCC) means total cost including design, building,
operation/maintenance and abolishment stages. The Japanese MoD reports LCC of
submarines based on the actual data every year. I estimate LCC is twice of
building cost in the case of 30 years, it means LCC of one submarine is 160B
yen [A$ 2 Billion].
Hardware of command system is not so expensive, but the US license fee for US [mainly Combat System and Weapons] software should be considered. The torpedo tube [electronics and software updates and hardware replacements] is expensive, but I think US torpedo tubes costs may be cheaper than Japanese, [because the US can spread the cost of tubes over large existing fleet of SSNs and Ohio subs and the 2 to 3 Virginia SSNs per year that the US is building].
Hardware of command system is not so expensive, but the US license fee for US [mainly Combat System and Weapons] software should be considered. The torpedo tube [electronics and software updates and hardware replacements] is expensive, but I think US torpedo tubes costs may be cheaper than Japanese, [because the US can spread the cost of tubes over large existing fleet of SSNs and Ohio subs and the 2 to 3 Virginia SSNs per year that the US is building].
For
a new Australian submarine modification of fuel tanks, improvement of endurance
and hull lengthening will be conducted, but they are not bigger modification
than between the Oyashio-to-[currently being built late model Soryu Mark 2s]
(+8B yen). Improvement for the earlier Soryus Mark 1s included hull
lengthening, [Anechoic
tiles] and installation of AIP.
[Of
the 65B Yen per submarine – see above formula] 30B yen, amounting to about 50%
of Building cost is labour cost. I considered the GDP per capita ratio between
Japan and Australia (= 0.6), then premium becomes 10B yen (= 30B yen x
0.5/0.6).
1600B
yen LCC for 10 subs may be tough, but 2400B yen [800B Building cost + 1600B LCC
for the whole Australian submarine fleet]
I think is very achievable.”
SPECIFIC COSTS FOR 23SS
As an example. 23SS launched
October 2014 – to be commissioned March 2016.
[Pete
Comment - Much of the costings below can be considered elements of the Japanese
Combat System. This Combat System is likely to have many commonalities with the
US AN/BYG-1 Combat System, given Japan uses the Harpoon missile, (Mark 48
similar) Type 89 torpedo and the Japanese Navy operates closely with the US
Navy. Both the Japanese Main (including half the submarine fleet) Fleet and US Seventh
Fleet ar based at Yokosuka
thus likely to share many C3 - Command, Control & Communications (hardware,
software and personnel “wetware”)].
S said “According to official data, costs of 23SS (total cost 54.6B yen) are as follows:
Command System (2.5B yen):
Command System (2.5B yen):
C2T (Command and
Control Terminal) & MTA (Maritime Terminal Adapter), LCS (Launch Control
System), NICI (Navigational Instruments Connection Interface), TDBS (Target
Data Base Server) and TDS(Tactical Display System)
Weapon and Sensor System (10B yen):
Weapon and Sensor System (10B yen):
Electro-optic mast, 13m Periscope, Submarine sonar system, Jamming system, Radar system, 53cm Torpedo tube, Harpoon launching system, Submarine decoy, Sound device for submarine decoy
[Upgrades to Torpedo and Harpoon missiles? (1.5B)]
Communication System (0.4B yen):
Radio communication device, Secure &Encryption device, Bridge information display, Submarine signal flare, Antisubmarine morse signal, Rescue signal generator for submarine
Propulsion, [LAB] Batteries, Generators and Building Costs (40B yen):
Submarine electric motor, Stirling AIP, Submarine building, Diesel generator,
Main batteries, Condenser of cooling units.”
S and Pete
