• Fincantieri is increasing Australian partnerships ahead of Sea 5000.
Filippo Vinardi
    Fincantieri is increasing Australian partnerships ahead of Sea 5000. Filippo Vinardi
  • Artist's impression of the GCS-A for Sea 5000 complete with CEA phased array. Credit: BAE Systems PLC
    Artist's impression of the GCS-A for Sea 5000 complete with CEA phased array. Credit: BAE Systems PLC
  • A rendered image of Navantia's F-5000 design. 
Navantia Australia
    A rendered image of Navantia's F-5000 design. Navantia Australia
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ASPI has released a new report into the upcoming decision on Australia’s $35 billion Future Frigate program.

“The  SEA 5000  Future  Frigate  program  has  three  separate  broad  objectives,” report authors Andrew Davies, Michael Shoebridge, and James Mugg write. “ The  first  is  to  replace  the  Anzac-class  frigates from  the  mid-2020s,  providing  the  RAN  with  a  new  class  of  warship  with  the  desired  capabilities.  The  second  is  industrial:  faced  with  a  steady  loss  of  shipyard  jobs  over  the  past  few  years,  the  Australian  Government  wants  work  at  the  ASC  Shipyard  in  South  Australia  to  begin  early  in  the  2020s. 

“The  third  objective  is  to  set  up  a  continuous  shipbuilding  program  that  will  continue  to  deliver  locally  built  vessels  in  perpetuity,  with  an  eye  to  being  able  to  export  systems,  components  or  perhaps  even  warships  in  the  future.”

The report points to a “tension” between the first two objectives. “A  large  body  of  historical  project  performance  data  shows  that  beginning  construction  before  the  detailed  design  is  largely  locked  down  can  result  in  costly  and  time-consuming  problems  down  the  track.”

The authors argue that the decision on the Future Frigates must be made with the long-term exporting capabilities of Australian industry in mind, because the build will “lock in a local monopoly” on warship design and construction.

The government should make those decisions, including setting out clear paths for local industry to participate in the winning bidder’s international supply chain, before the decision is made. The authors argue that this is when the Commonwealth has the greatest leverage over tenderers.

The report argues that the government’s leverage is also bolstered by the fact that the Australian order is one of the world’s largest. In addition, Australia will make its decision on the Future Frigate before Canada or the United States, which are set to acquire a combined total of 35 frigates (15 for Canada and 20 for the US).

“The  multiple  competitions  being  run  by  Five  Eyes  partners  open  up  the  possibility  of  global  economies  of  scale  and  partner  navies  operating  vessels  with  significant  commonality.  Being  the  first  of  the  countries  to  make  a  choice  means  that  Australia  doesn’t  have  the  benefit  of  knowing  which  designs  the  Canadians  and  Americans  will  choose. 

Artist's impression of the GCS-A for Sea 5000 complete with CEA phased array. Credit: BAE Systems PLC
Artist's impression of the GCS-A for Sea 5000. Credit: BAE Systems PLC

“But,  conversely,  the  bidders  in  Australia’s  competition  will  also  be  trying  to  use  their  success  to  leverage  the  other  competitions,  which  gives  the  Australian  Government  the  opportunity  to  extract  favourable  concessions.”

The report also examines potential modifications that may have to be made to each bid. Navantia’s design may be modified to include an electric drive and a second Seahawk helicopter; BAE’s Type 26 might require a greater number of Mark 1 VLS cells installed and will require modification to support CEAFAR radar; and few of the FREMM’s major sensor and weapons systems are preferred by the government, suggesting the need for significant modifications on that build as well.

ASPI’s report, however, argues that the FREMM build provides “probably  the  greatest  opportunities  for  Australian  industry  to  contribute  to  a  global  commercial  and  military  market  as  an  export  partner.”

Overall, ASPI concludes that the FREMM and Type 26 have the strongest ASW qualifications; the Navantia bid has the lowest project risks and is likely to be the cheapest choice, whilst the Type 26 will be the most expensive; and in terms of industrial strategy, Fincantieri has the largest global supply chain, although the details of Australian industry access depends on the details of the tender.

The report is keen to emphasise the importance of intellectual property transfer to Australian firms to allow domestic industry to become a global exporter following the decision.

Finally, the authors argue that no choice will be perfect; “It’s  always  possible  that  Defence’s  preferred  choice  will  face  some  competition  at  the  cabinet  table  due  to  the  proximity  of  the  next  federal  election.”

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