Strategy Matters in Australia’s Submarine Deal

East Asia Forum

01 March 2016

Sam Bateman

Australia’s future submarine program is the largest and most complex defence procurement in the nation’s history. While technical issues to establish the ‘best’ submarine remain important, strategic, political and economic factors are key to Australia’s decision. The deal could have a significant impact on Australia’s regional relations and its ability to act independently within the region.

There are three contenders in the current evaluation process. France’s state-controlled naval contractor is offering a conventional-powered version of the nuclear-powered Barracuda-class submarine and Germany’s ThyssenKrupp Marine Systems (TKMS) propose a Type 216 Class submarine, an up-sized version of the popular Type 214 submarine. The Japanese government has a proposal based on the existing Soryu class. None of these options are ideal for Australia’s requirements.

The contest between Japan, Germany and France has become increasingly bitter with sniping between the rivals. Recent reports suggest that competition among the bidders has led to the acquisition cost for Australia being at least AU$5 billion (about US$3.5 billion) less than expected.

… Sam Bateman is an adviser to the Maritime Security Programme at the S. Rajaratnam School of International Studies, Nanyang Technological University. He is a former Australian naval commodore who has worked in force development areas of the Department of Defence in Canberra.

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