Australian submarine tender narrows to Japanese and French bids: sources

by and

Reuters

The competition for a 50 billion Australian dollar ($34.55 billion) contract to build Australia’s next submarine fleet is narrowing to a race between Japan and France as a bid from Germany’s Thyssen-Krupp Marine Systems (TKMS) has lost ground over technical concerns, multiple sources said.

Australia is expected to decide the winner of one of the world’s most lucrative defense contracts within the next six months, ahead of a national election in which the deal and the jobs it will create is expected to be a key issue for the conservative government.

TKMS is proposing to scale up its 2,000-ton Type 214 class vessel, while Japan is offering a variant of its 4,000-ton Soryu submarine made by Mitsubishi Heavy Industries and Kawasaki Heavy Industries.

France’s state-controlled naval contractor, DCNS, has proposed a diesel-electric version of its 5,000-ton Barracuda nuclear-powered boat.

Australia has said it wants a boat in the 4,000-ton class.

Scaling a submarine to twice its original size presents exponential technical challenges, experts say.

That puts TKMS furthest from having the experience to offer what Australia wants in a large, long-range, stealthy submarine to replace its aging Collins-class fleet, said six industrial sources in Asia and Australia with knowledge of the situation.

“The German proposal is an enlarged version of a smaller existing submarine, and that technically is risky,” said one source.

TKMS and one of the sources in Australia, who has decades of experience in the global arms industry, cautioned against jumping to conclusions as each side jockeys for the best outcome in what may ultimately be a political decision.

Australia wanted a partner to design and build a new submarine, which neutralizes any perceived advantage with existing bigger boats, said TKMS Australia Director Jim Duncan.

“The rumors could well be right. Who knows,” Duncan said when asked to respond to what the industrial sources said. “My only advice, having spent many years in this environment is believe nothing that you hear and only half of what you see.”

Officials at the Future Submarine Program at the Australian Department of Defense did not respond to a request for comment.

DCNS Australia CEO Sean Costello declined to comment on his competitors, but said experience in large submarine design is critical for the Australian project.

Japan was initially seen as the front-runner, partly due to close ties between Prime Minister Shinzo Abe and former Australian Prime Minister Tony Abbott, who was ousted in a party coup by Malcolm Turnbull last September.

With Turnbull quiet on the matter, Japan is touting its offer as a way to build military ties between two allies in Asia, something U.S. officials have said they want to see as China emerges as a regional power.

But Japan, which until two years ago had a decades-long ban on arms exports, has been hobbled throughout the process by a lack of experience in managing overseas defense contracts and the shifting political tide in Canberra.

With Australia facing an economic slowdown, that has put job creation and innovation atop the political agenda.

Japan was slow to commit to build all vessels at South Australian shipyards, a politically significant pledge that both DCNS and TKMS made quickly.

At the same time, DCNS and TKMS pledged to share sensitive technology with the Australian government and promised packages of economic incentives.

Australia’s Defense Department is formulating a recommendation based on materials submitted by the bidders late last year and is expected to give that to its Cabinet as early as March.

  • Christian Morales Moya

    mmm….build an sub twice a size is not so complicated really for germans, for other side, the german technology AIP is much superior of french or japanese (hydrogen stored in solid deposits or methanol), that is much more important, and the stealth technology also the germans are superior

    • Starviking

      The problem with doubling the size is that you really need to design a new boat from scratch: subs are relatively narrow cylinders, and it is easy to stretch one by lengthening it. However, at double the displacement the length is doubled. The boat becomes a very long, narrow cylinder. This can have big effects on the hull stresses – possibly causing hull failure under conditions where a shorter, fatter boat would have no problems.

  • CaptainAsia

    If Australia want the best, aside from the USA, then Japan is the only real choice. We all know how the German, French and Russian tech works in detail, but the Japanese have kept their program so secret up to date. It is said that Japanese subs can do a sing and dance around and over the Chinese ones and the Chinese would not even know about it. The Japanese subs even manage to evade to most advanced detection equipment ie: high sensor capability ocean laid cable alerts, something all accept the USA can avoid, all the rest stand out like a sore thumb with their sonic signatures.

  • http://www.sheldonthinks.com/ Andrew Sheldon

    This sub contract is the biggest waste of money. Why does Australia need subs? There is no prospect of defending its coast. We should be building fox holes in old mine shafts. Let the US, Japan, Britain and French rule the seas; Australia can rule the lithosphere. We can hide. What a waste of money. NZ has the right idea. We should be a role model for civic politics, not engaging in war-mongering. Let these states that are invested in war pursue that. This shoddy investments, aside from being corrupt, will result in Aust taxpayers being bankrupted by corrupt govt getting kickbacks from Japanese military machine.
    Aust & NZ should be investing in a new political framework based on anarcho-capitalism; not perpetuating the failed US military state. This is the US doing a Rome-style collapse. Let’s not take Australia down with them. How can Australia possibly fund this? The globe is going into a deflationary spiral. There will be no mineral demand for Australia to finance this ‘blotch’ on its terms of trade. This is suicide for Australia, from politicians who don’t understand economics, or much else. Remember the last time Aust purchased submarines?

    • EmmaDelores

      Thank goodness people like you are a minority voice. Australia has no choice but to upgrade its armed forces, thanks to the arms race initiated by China in the region. This would have never happened if China had not started sabre rattling. China’s action has now changed the attitude of the USA, Japan, Australia, India and dont forget the myriad of nations in South EAst Asia. If China threats are not counter balanced there will be nothing to stop them and their already planned goals of domination through force in the whole Asia pacific region. Digging fox holes as you say will not suffice when the missiles start raining down on cities like Sydney and Melbourne.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Emma in that issue I suspect I’m in the majority; but who would know. I’ve never seen a survey question that concerned itself with foreign affairs. China gains too much from foreign investment. Look what the absence of it from China has done to its economy. How does economic slavery in the West precisely model freedom in China. It makes us look like hypocrites. If you acknowledge that China is just Sabre rattling to test the West; what do we gain by over-investing in unnecessary provisions. If the concern is missiles, why would China strike irelevant Australia and not the USA or Japan. If the concern is missiles, then surely nuclear deterrence and foxholes would be the strategy of the day. The last sub procurement was a plunder. Pity those in any majority that govt ever gets it right.

      • R Valencia

        In regards to fox holes, you haven’t learnt the lessons from the French Maginot Line. For nuclear weapons, a better strategy is Mutual Assured Destruction (MAD), but Australia doesn’t have an independent WMDs and we are linked to USA’s WMD usage and policies.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        I haven’t got a problem with a modest nuclear program, nor with a modest submarine program. Its really the size of the commitment.

      • R Valencia

        Would it be cheaper to have modest submarine fleet with nukes or having larger but modest non-nuclear armed forces (air force, navy surface ships, land)?

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Nuclear is the future. I’d be waiting for Lockheed Martin to develop a mini-size compact reactor and running subs with that. For a country largely at peace, a small nuclear fleet makes more sense, particularly unmanned craft because they are rapidly built in any case of threat.

      • R Valencia

        Would it be cheaper to have modest submarine fleet with nukes or having larger but modest non-nuclear armed forces (air force, navy surface ships, land)?

      • R Valencia

        Building military bases from semi-submerged islands in the contested sea territories and sea lanes are not sabre rattling i.e. they are real actions with real materials being committed.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        I would say less antagonistic than buying submarines whose sole application is military service. Now, you’d not buy them to fight North Korea. Indonesia? India? More plausibly China.
        The reality is that China is ‘resource vulnerable’. Its pushing in jurisdictions it can – the South China Sea. Even if the region was Philippines controlled ‘legitimately’, it would be China developing it anyway. What US company is going to develop a project in a ‘war zone’. So Chinese scaremongering has done its job. The sabre rattling has ensured that China controls the development of the region, so that China has proximal oil & gas supply potential.
        Not very nice conduct, but given the rhetoric, not unsurprising.

    • Starviking

      The subs protect Australia by being able to interdict enemy shipping at choke points – all those channels between Malaysia, Indonesia, PNG, The Philippines, Taiwan, and Japan.

      They can also wait for enemy shipping near their ports and on their trade routes.

      An enemy ship sunk or forced to remain in port is a ship that cannot threaten the Australian Coast.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        The same role can be achieved with the air force at their discretion as opposed to subs in service. Australia has a pretty sophisticated over-the-horizon radar system as well. Are we really concerned about a few ships landing in Australia? High speed cats will out-speed a few subs. No, I think this is the projection of Western power into Asia. These governments don’t exactly mount a compelling case for freedom. I’d not trust them with military power either.

      • Starviking

        Subs are stealthier and can lurk undetected for significant lengths of time. RAAF planes on their own would face range issues getting to many choke points, have a short period of time over the area, and would probably face significant air defences when pressing an attack. Getting intel for attacks could be problematic too.

        Are we really concerned about a few ships landing in Australia?

        You seemed to be alluding to something like that:

        “There is no prospect of defending its coast. We should be building fox holes in old mine shafts.”

        As for high speed catamarans, so? They are not the sub’s forte. I would expect RAAF or RAN FAA aircraft to take care of any catamarans – though why an enemy would be sending catamarans I don’t know. Current Cats are not well-suited for Amphibious Assault Ops.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        When you have a budget of $38bil, there is scope for improvisation. There are runways all over australia. Some can be upgraded. Planes can be refuelled mid flight. Long haul flights are possible if you have rapid response systems and defense systems.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Do you know why we are finding it easier to discover oil – a liquid? Its because geophysics is getting more sensitive, with more sophisticated modelling software. That said, it gets harder to hide a 240-foot submersible. Its a rather unnatural shape and size, and software can be created to model such ‘unnatural features’ and to distinguish them from natural phenomenon. The $38 billion budget is excessive for a small country like Australia. Moreover the risk of obsolescence is high. Anything like that immediately becomes a target of something newer because it cannot scuttle. It cannot even stand still without being ‘noticed’.

      • R Valencia

        Natural objects wasn’t designed against sensor threats. Sound wave pings can be negated by sound wave inversion techniques i.e. active noise cancelation techniques.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        That’s the point, notwithstanding ‘cancellation’, which is remedied with more sensitive equipment, ‘unnatural’ sound absorbing layers are still distinct from the ping of natural objects.

      • R Valencia

        Which is remedied by digital active noise phase ‘cancellation’ which operates similar to Digital Radio Frequency Memory (DRFM) jammer.

      • R Valencia

        Which is remedied by digital active noise phase ‘cancellation’ which operates similar to Digital Radio Frequency Memory (DRFM) jammer.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Oh ok, I see what you are saying. Hmmm. Don’t you think that is in itself ‘unnatural’, so distinct. Then there is the fact its a moving object. Time-variable data is another source of ‘identification’ for software. Natural objects don’t move.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Oh ok, I see what you are saying. Hmmm. Don’t you think that is in itself ‘unnatural’, so distinct. Then there is the fact its a moving object. Time-variable data is another source of ‘identification’ for software. Natural objects don’t move.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Oh ok, I see what you are saying. Hmmm. Don’t you think that is in itself ‘unnatural’, so distinct. Then there is the fact its a moving object. Time-variable data is another source of ‘identification’ for software. Natural objects don’t move.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Oh ok, I see what you are saying. Hmmm. Don’t you think that is in itself ‘unnatural’, so distinct. Then there is the fact its a moving object. Time-variable data is another source of ‘identification’ for software. Natural objects don’t move.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Oh ok, I see what you are saying. Hmmm. Don’t you think that is in itself ‘unnatural’, so distinct. Then there is the fact its a moving object. Time-variable data is another source of ‘identification’ for software. Natural objects don’t move.

      • R Valencia

        Both sides are using software to detect the acoustic and faking acoustic characteristics and submarine is moving slowly in the environment. What happens if a submarine can fake a natural moving whale’s acoustic characteristic? Modern stealth’s main goal to reduce the enemy’s detection range i.e. it’s not a cloaking device.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        I’m actually not against subs. I’m actually against large investments in them because I can see where the market is moving to, and this technology is anachronistic. We are moving towards miniaturised submarine units, unmanned in all likelihood, nuclear powered, perhaps despatched from mother subs, but not necessarily. Now, its possible that these craft can be re-engineered, but it begs the question, as to whether this is a sound investment, and I would say its a ‘mature’ stage in the life of the existing sub technology, so destined to be quickly obsolete. Therefore, I’d be delaying or ‘seizing the opportunity’ and developing a new Australian industry, or working with foreign partners. Nuclear partner – Lockheed Martin.

      • R Valencia

        Which is remedied by digital active noise phase ‘cancellation’ which operates similar to Digital Radio Frequency Memory (DRFM) jammer.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        That’s the point, notwithstanding ‘cancellation’, which is remedied with more sensitive equipment, ‘unnatural’ sound absorbing layers are still distinct from the ping of natural objects.

      • R Valencia

        GE’s Leakwise product line uses electromagnetic (EM) absorption technology for the early detection and monitoring of hydrocarbons on water.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Hmm. Not sure how that would apply – EM to detect hydrocarbons? Seems a little crude detecting hydrocarbons in seaways full of ships, not to mention natural seaps. Sounds like a technology Obama and Bernie would buy. lol

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Hmm. Not sure how that would apply – EM to detect hydrocarbons? Seems a little crude detecting hydrocarbons in seaways full of ships, not to mention natural seaps. Sounds like a technology Obama and Bernie would buy. lol

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Hmm. Not sure how that would apply – EM to detect hydrocarbons? Seems a little crude detecting hydrocarbons in seaways full of ships, not to mention natural seaps. Sounds like a technology Obama and Bernie would buy. lol

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The new proposed subs has sound absorbing layer not just generating very little noise.

      • R Valencia

        The Collins are armed with UGM-84C Sub-Harpoon anti-ship missiles.

      • Starviking

        Subs are stealthier and can lurk undetected for significant lengths of time. RAAF planes on their own would face range issues getting to many choke points, have a short period of time over the area, and would probably face significant air defences when pressing an attack. Getting intel for attacks could be problematic too.

        Are we really concerned about a few ships landing in Australia?

        You seemed to be alluding to something like that:

        “There is no prospect of defending its coast. We should be building fox holes in old mine shafts.”

        As for high speed catamarans, so? They are not the sub’s forte. I would expect RAAF or RAN FAA aircraft to take care of any catamarans – though why an enemy would be sending catamarans I don’t know. Current Cats are not well-suited for Amphibious Assault Ops.

      • R Valencia

        What’s the use for over-the-horizon radar if a nation doesn’t have the means for a counter strike? High speed cats are no match against strike fighter aircraft with anti-ship missiles.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Reasonable enough point. The radar system is a defensive measure. Subs are maritime defence or attack. There is still scope for ‘defence’ on land. i.e. missile defense systems, or even a modest sub program for flexibility. More importantly is – What would be China’s incentive to attack Australia? Resources? They have now very cheap access to resources. The best of intentions for China’s leadership is to preserve hegemony over its population. Its only when the US pushes the envelope, challenges that franchise, that Russia or China will push back. These countries are developing. The burden of seeking liberalisation lies internally. If those regimes collapse, its a huge waste of resources. A disproportionate waste. The US has served as the global policeman. Clearly there is some reticence to retain the scale of defence budget as in the past. I’d not even be so sure to countenance Japan as an ally, even if the current administration (LDP) is. You have the US spying on Germany. What’s to stop Japan adding its own suerveillance capability to a seemingly stealthy submarine, given the size.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Reasonable enough point. The radar system is a defensive measure. Subs are maritime defence or attack. There is still scope for ‘defence’ on land. i.e. missile defense systems, or even a modest sub program for flexibility. More importantly is – What would be China’s incentive to attack Australia? Resources? They have now very cheap access to resources. The best of intentions for China’s leadership is to preserve hegemony over its population. Its only when the US pushes the envelope, challenges that franchise, that Russia or China will push back. These countries are developing. The burden of seeking liberalisation lies internally. If those regimes collapse, its a huge waste of resources. A disproportionate waste. The US has served as the global policeman. Clearly there is some reticence to retain the scale of defence budget as in the past. I’d not even be so sure to countenance Japan as an ally, even if the current administration (LDP) is. You have the US spying on Germany. What’s to stop Japan adding its own suerveillance capability to a seemingly stealthy submarine, given the size.

      • R Valencia

        What’s the use for over-the-horizon radar if a nation doesn’t have the means for a counter strike? High speed cats are no match against strike fighter aircraft with anti-ship missiles.

      • R Valencia

        Btw, did you forget MH370? So much for Australia’s OTH radars.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Haha. that’s for above the horizon, not under it. I suspect they’d not want to highlight its effectiveness, even if it did pick it up. i.e. They got to Chinese to spend money on treasure hunting in the indian ocean. I can’t say I know its range or effectiveness. Very powerful tech. :)

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Haha. that’s for above the horizon, not under it. I suspect they’d not want to highlight its effectiveness, even if it did pick it up. i.e. They got to Chinese to spend money on treasure hunting in the indian ocean. I can’t say I know its range or effectiveness. Very powerful tech. :)

      • http://www.sheldonthinks.com/ Andrew Sheldon

        Haha. that’s for above the horizon, not under it. I suspect they’d not want to highlight its effectiveness, even if it did pick it up. i.e. They got to Chinese to spend money on treasure hunting in the indian ocean. I can’t say I know its range or effectiveness. Very powerful tech. :)

      • R Valencia

        Btw, did you forget MH370? So much for Australia’s OTH radars.

      • http://www.sheldonthinks.com/ Andrew Sheldon

        The same role can be achieved with the air force at their discretion as opposed to subs in service. Australia has a pretty sophisticated over-the-horizon radar system as well. Are we really concerned about a few ships landing in Australia? High speed cats will out-speed a few subs. No, I think this is the projection of Western power into Asia. These governments don’t exactly mount a compelling case for freedom. I’d not trust them with military power either.

    • R Valencia

      NZ’s approach would NOT work with nations that are in conflict around South China/West Philippine sea. NZ is far from South China/West Philippine sea.

      Like NZ, Philippines doesn’t have a proper air-force with fighter aircrafts and it was forced to re-arm e.g. purchased FA-50 fighter aircrafts. Perhaps larger friendly nations should remove their protection for NZ and see how foolish is the NZ approach.

  • Alexander Judzewitsch

    The advisors advising the Prime Minister and Defence Minister would do well to make these senior ministers aware of a couple of excellent papers written by Jon Stanford and published by John Menadue:

    Jon Stanford. Australia’s New Submarine: What is its Mission? Posted on 22/10/2015 by John Menadue

    The Defence requirements stated In the 2009 Defence White Paper,cannot be met by any diesel powered attack submarine. So are we going to dumb down the requirements to suit an inadequate, pre-determined solution?

    Jon Stanford. Defence procurement and the new submarine Posted on 11/12/2015 by John Menadue

    Look at past mistakes and please don’t repeat them anymore. We should not try to build another unique submarine, one that has never been built before and can’t be evaluated by taking it for a test drive. You wouldn’t even buy a car like that and yet the Government seems to be embarked on selecting a critical, very complex weapons system, costing billions of dollars of taxpayer money, just like that.

    Check out the Virginia class submarine. It is available off the shelf for a fixed price, can be built and delivered with a minimum of risk, has an extensive plan for future upgrades, is the only boat that would need a minimum if any modifications to fit into Australia’s mostly USA sourced weapons systems with a unique assurance that it will remain so. It is the best attack submarine in the world currently in production with a service life planned out to around 2070 which meets our requirements. The training establishments are proven and so are the simulators. We might even be able to get some boats early to save money by decommissioning the Collins boats early. That alone would save $600m per year.
    I would hate to think of the extra cost if we had to keep them longer than
    planned which is a real risk we take with a new, unique design made in
    Australia. Oh yes, and we can take the Virginia for a test dive whenever we’re ready.

    If we are serious about creating long term job opportunities for Australia then let’s negotiate a deal with the USA along these lines:

    Jointly build a maintenance facility in WA (if our boats are to be located in
    WA the maintenance facilities should also be there!) and then use Aussies to maintain the USN boats serving in our region as well as our own. Good for the USN as it makes their fleet more productive (no need to travel to the USA and then back again) and creates jobs and foreign exchange earnings for Australia for a very long time. It would in effect be a new export business!

    The Virginia option has a lot of unique benefits. Shouldn’t we at least evaluate it?