Japan submits bid for huge Australian submarine contract

AFP-JIJI, JIJI, Kyodo

Japan on Monday submitted its bid for Australia’s multi-billion dollar submarine contract, a deal that France and Germany are also desperate to win.

Australia has solicited bids for a project worth up to 50 billion Australian dollars ($36 billion) to replace its current diesel-electric Collins-class submarines, with a Monday deadline to submit final proposals.

A Defense Ministry official in Tokyo said Japan’s proposal includes plans to build the submarines in Australia, which is keen to secure more jobs in connection with the project.

The Abe administration substantially relaxed regulations on arms exports in April 2014. Winning the Australian sub deal would provide major impetus to Japan’s plans to export defense equipment to countries such as India and the Philippines.

Australia plans to spend some AU$20 billion to build as many as 12 submarines to replace its aging fleet.

The government-led Japanese team with Mitsubishi Heavy Industries Ltd. and Kawasaki Heavy Industries Ltd. has proposed the world’s first lithium ion battery-powered submarines against Germany’s plan to enlarge its export model and France’s nuclear subs.

Rival bidders DCNS SA of France and ThyssenKrupp Marine Systems GmbH of Germany have also offered to build the submarines in Australia and generate jobs.

The Defense Ministry official said Japan is “confident” its proposal will win, without disclosing further details, including proposed expenses and the construction period.

During a visit to Australia in November, Defense Minister Gen Nakatani said picking Japan could help ensure maritime security in the Asia-Pacific, alluding to the importance of regional allies such as the U.S., Japan and Australia working together in the face of China’s growing military might.

For Australia, cooperating with Japan on a defense project risks angering China, its biggest trading partner.

The tender process has been politically sensitive, with Canberra keen to maximize Australian industry involvement and jobs. There are fears that an off-the-shelf purchase would kill off the domestic shipbuilding industry.

  • disqus_vBekJrf7g5

    I hope the resumption of Japanese whaling makes accepting the Japanese bid politically toxic for the Australian government.

    • Douglas

      I doubt a few whales are going to impact a deal relating to the defence of a nation worth $50B.

      • TV Monitor

        Douglas

        Yes it will, because “We are not buying from a bunch of whale killers” narrative will prevail in Australia.

        Recall that it was the Australian government that took Japan to the ICJ for the original whaling ban and Japan just disregard with ICJ verdict, putting a slap on Australia’s face.

      • Editor_in_Charge

        What you are saying is so so LOL like kinda saying All chinese are murderers of Tibet and dog eaters just because a few of them did it.

      • Douglas

        I recall it was the previous Labor government that instigated proceedings at the ICJ. Whales will have no bearing on national security.

      • TV Monitor

        Douglas

        I wish I could provide links to this article but URLs are banned at Japantimes.

        Hunt said the prime minister, Malcolm Turnbull, and the foreign minister, Julie Bishop, have also directly told Japan that Australia does not support whaling.

        Japan is in the running for a contract to build submarines for the Australian navy. The Australian Green party demanded that the Canberra government use the prospective deal to put pressure on Tokyo.

        Greens senator Peter Whish-Wilson accused the Japanese of “thumbing their nose” at the Australian people, and said the Turnbull administration should issue an ultimatum: either stop the whaling fleet or lose any chance of winning the submarine contract.

        So no sub contract unless Japan renounces whaling.

        Bug Japan won’t renounce whaling, so no Japanese subs for Australia.

      • Tachomanx

        And when was the last time the greens had any leverage in Australian politics?

      • Clickonthewhatnow

        One person said Australia should do so, this does not mean Australia WILL do so.

      • Douglas

        LOL TV Monitor quoting Greens
        members.No-one takes the communist Greens seriously, least of all the Liberal
        government. Look, whales may be a talking point on university campuses,
        Centrelink queues and possibly in the public service but it is not a matter of
        great importance to general public. Again whales and more so the Greens will
        not have any influence on matters of national security.

    • TV Monitor

      Indeed, it is a two strike against Japan’s bid, the Chinese opposition to the Soryu(China’s fine with European bids) and the resumption of Japanese whaling.

      • Editor_in_Charge

        yeah chini’s really worried so much, like we dont want Aus to get the best sub from Japan.

      • TV Monitor

        It has nothing to do with the quality of subs and everything to do with naval cooperation.

        Buying submarine isn’t like buying a car; it comes with a large cooperation package where Australian navy officers fly to Japan to get trained, and JMSDF submarine officers board the Australian submarine to monitor sub operation to ensure the Australian crew operates subs safely.

        This is why China is so against Australia buying anything Japanese. Australia can buy from anyone but Japan, that’s the CCP position and it has been relayed to Malcolm Turnbull via his in-law, who is a high ranking CCP official. So Malcolm Turnbull knows better than anyone what is acceptable to the CCP and what not.

      • Tachomanx

        So Turnbull is a Beijing led puppet? The what about the man calling China the biggest threat and not renouncing the country’s cooperation with China’s rivals like the U.S. India, Japan the Philippines. Or the possibility of conducting it’s own FON in the SCS?

        Making connections in your head as always. Can’t be healthy though.

      • TV Monitor

        It has nothing to do with the quality of subs and everything to do with naval cooperation.

        Buying submarine isn’t like buying a car; it comes with a large cooperation package where Australian navy officers fly to Japan to get trained, and JMSDF submarine officers board the Australian submarine to monitor sub operation to ensure the Australian crew operates subs safely.

        This is why China is so against Australia buying anything Japanese. Australia can buy from anyone but Japan, that’s the CCP position and it has been relayed to Malcolm Turnbull via his in-law, who is a high ranking CCP official. So Malcolm Turnbull knows better than anyone what is acceptable to the CCP and what not.

      • TV Monitor

        It has nothing to do with the quality of subs and everything to do with naval cooperation.

        Buying submarine isn’t like buying a car; it comes with a large cooperation package where Australian navy officers fly to Japan to get trained, and JMSDF submarine officers board the Australian submarine to monitor sub operation to ensure the Australian crew operates subs safely.

        This is why China is so against Australia buying anything Japanese. Australia can buy from anyone but Japan, that’s the CCP position and it has been relayed to Malcolm Turnbull via his in-law, who is a high ranking CCP official. So Malcolm Turnbull knows better than anyone what is acceptable to the CCP and what not.

  • TV Monitor

    The Japanese bid is all but eliminated due to the resumption of whaling and the election of a Pro-China Prime Minister with a half-Chinese grandson, so it is a two way race between German and French bids.

    • Tachomanx

      You seem to keep forgetting Turbull calling China the biggest threat around or how he hasn’t changed policies regarding it’s cooperation with China’s many other rivals in the region.
      Nevermind the choir of praises australian officers had for the Soryu, you know, the only submarine actually in service while the french and german options are nothing more that blue prints and gilded promises.

  • Editor_in_Charge

    Its like, if you want the best then Aus would go with Japan because this is about defense and who cares what China thinks when it comes to defending Australia. China is like Oh I am so angry that you are getting subs from Japan, why? because the Chinese don’t want Aus to get the best. that is so so lol and OMG, like kinda so silly.

    • disqus_vBekJrf7g5

      Why are you talking about China in every damn comment? Story is about Japan! Are you mentally ill?

      • Starviking

        I have no doubt that if Australia picked Japan to provide the subs, China would be complaining about Japan doing so.

  • TV Monitor

    I was wondering why Japan decided to announce the resumption of whaling at this critical time.

    Turns out that French Barracuda submarine is leading the Australian sub race right now, so the Japanese government felt it had nothing to lose by announcing the resumption. I wish I could provide the link but blame Japan Times policy. The article is at businessnewsline dot com

    So there you go, Japanese government’s own action confirms that Japan has no chance of selling submarines to Australia.

    • disqus_vBekJrf7g5

      Yeah, and the Japanese are not paying the fine that the Australian courts handed down for whaling last week, so I think it’s all over for the Jaoanese bid. This ‘news’ is just for the domestic parochials.

    • Tachomanx

      Even here you spout your nonsense based on nothing and making weird connections? Where is your evidence? Don’t have it? Quite a surprise.

    • Red Chairman Toad

      >>>why Japan decided to announce the resumption of whaling at this critical time.

      I hear that there is an internal conflict over the deal within the J-government. Some officials who are reluctant to sell submarine technology to Assie try to prevent the deal (with whaling?). So no deal could make them happy….

  • Brian Grover

    Japanese Blood Products
    There is a way to get Japan to stop the slaughter of dolphins and whales. The true power of Japan lies in the zaibatsu or industrial conglomerates. Traditionally government has acted more as handmaidens to such industrial powerhouses as Mitsubishi or Mitsui or Sumitomo than as representatives of the people. Hence the moniker: Japan Inc. Like the zaibatsu, latter-day conglomerates such as Toyota, Sony, Panasonic, Honda, Toshiba, Fujitsu and so on are, at present, very vulnerable. On top of a fragile economy, Toyota’s product recall debacle has started to spill over into a consumer backlash against identifiably Japanese products in general. Indeed, Honda has just launched a feel-good campaign to distance itself from Toyota while ensuring the consumer connects notions of trust and reliability with Honda products.

    Obviously, the slaughter of cetaceans is of little economic value to Japan: at issue are a few hundred jobs and a few million dollars at most. Certainly, when compared to the trillions of dollars in trade that the Japanese high tech, consumer electronics and automotive sectors are worth, cetaceans are small fry. The objective then is to first of all threaten those key industries, and if that doesn’t work, carry out the threats. This can be achieved in a three-step approach.

    Step One
    Set up an ad hoc NGO specifically mandated to tackle the Japanese side of cetacean issues once and for all. Forget the Norwegians and Icelanders for the moment. They can be dealt with once Japan is out of the picture. This should be an umbrella organization working on behalf of all the disparate stakeholders and activists currently involved in these particular cetacean issues.
    Find an ad agency willing to work pro bono for prestige. The mere act of searching for such a media company will be enough to alert some Japanese companies of the looming threat outlined below in step two while tipping off their international competitors to the opportunities that are outlined below in step three.

    Step Two – The Carrot
    Approach the Japanese. Deals in Japan are best made in the back room. Make a high-level pitch to key government departments and the CEOs and VPs of the top 100 or so key industrial players in critical export industries. The gist of the pitch will be simple: unveil a subtle, sophisticated mockup campaign demonizing Japanese exports as “blood products”. Make it clear that the campaign and its derivatives need never see the light of day. Make it also clear that this mockup is only the beginning of a campaign of absolute terror designed to devastate Japanese industry unless the dolphin slaughter and the whale hunt are relegated to history. Indicate that Japan Inc. has a one-time only opportunity to reap a positive public relations dividend by acting fast. Corporate Japan must lean on government and with all haste. If not, then Step Three will be deployed at great peril to Japanese industry.

    Face is an important consideration in Japan. Negotiating out of the limelight will avoid embarrassment that could lead to intractability. Japan is fed up with being bullied around by the international community and has bizarrely formulated its stance on cetacean issues in the mistaken belief that these are largely Japanese issues. The opportunity to pretend that it is joining the global community of its own volition, while gaining kudos that translate into trade, is a potentially powerful force.

    At the same time, the prospect of losing face, should the whole issue blow up in the public eye, can be a powerful motivator as well. Indecisive prevaricating has been the defining theme of modern Japan. The prospect of failing to act yet again, knowing that Japanese industry will be assailed on all sides, might be just enough to push the glacially slow political process forward.

    Step Three – The Stick
    If direct talks fail, approach competing American, European and especially Korean industrialists at an equally high level with a pitch demonstrating the strategic advantage of connecting Japan and its “blood products” — across the board — with cetacean slaughter. These corporations will be aware of the advantages of appearing cetacean-friendly in the minds of consumers but may not yet realize that these issues can be leveraged to deal a powerful body blow to their Japanese competitors.

    Expect a variety of responses. The timid will sit on the sidelines vacillating. Others will be reluctant to take Japan on directly but may be persuaded to make cetacean-friendly donations though their charitable portfolios. Some of these will even be willing to support a direct assault on Japanese “blood products” via an ad hoc third party. Finally there are those, motivated by desperate times, which will be inclined to take Japan Inc. on directly in order to appeal to those consumer segments which are motivated by Earth Issues. The payoff could be exceptional with direct sales and a significant slice of market share up for grabs.

    An assault can take many forms. Companies opting for direct action should consider mounting creative conventional media campaigns which tastefully denigrate competing Japanese products by linking them to cetacean slaughter and, at the same time, dissociating their own products from such environmentally heinous acts. Companies will realize that a huge opportunity exists, because of the controversial nature of such a campaign, to reap a massive dividend in free advertising as media throughout the world carry the first and best attack ads out of the gate.
    New Media should not be overlooked. There are immense benefits worth exploring in the realm of viral marketing as well: generating controversial content for YouTube, StumbleUpon and other social media, including even simple e-mail distribution. The costs are insignificant while the payoff potential is huge.

    Where companies have existing procurement contracts with Japanese companies an opportunity exists to serve notice that those arrangements will be reviewed in the light of Japan’s continuing intransigence on cetacean issues.
    Korea is a critical player in this strategy. Korean industry is very much in an ascendant phase, as much as industry in Japan is on the downswing. This is no coincidence. Korea has spent the last decades emulating Japanese success in precisely the sectors that Japan has been so successful in defining and dominating.

    There are no holds barred in Korean business practices. The objective is to make money as fast as possible. Asians in general aren’t particularly sensitive to the value of nebulous green issues in marketing but you can bet that the Madison Avenue handlers of companies like Samsung, Hyundai, KIA, LG, and other chaebol will recognize the opportunity once it is demonstrated to them.

    Self-interest can be harnessed to bring about social change. Global advertising agencies serve themselves best when serving their corporate masters whether warning their Japanese clients that something is afoot or elucidating an opportunity for competing clients elsewhere in the world. Japanese multinationals have a vested interest in seeing that Japanese political policies are aligned with those of the globe. Other multinationals can serve their own interests best by taking advantage of that misalignment. NGOs, for their part, serve their own interests by opening new avenues of funding and developing new approaches to effectiveness.

    Towards consensus-building, pass it on also to like-minded people throughout the world.