Australia, Naval Group sign Future Submarine contract after two years of negotiations

The Australian government has signed an official contract with France’s Naval Group for the construction of 12 new submarines for the Royal Australian Navy.

The contract signing on February 11 marks the conclusion of two years of negotiations after Australia selected the French shipbuilder over Japanese and German competitors in December 2016.

Work on Australia’s AUD50 billion submarine program, which will deliver 12 vessels in total, has taken place under the design and mobilization contract, the government said, adding that this will continue uninterrupted under the February 11 deal.

“This agreement with Australia will see Naval Group transfer the “know-how” and “know-why” to Australia to become an sovereign submarine nation,” Herve Guillou, Chairman and CEO, Naval Group, said commenting on the contract. “We are very excited about the opportunities that lay ahead of us and are committed to delivering the Future Submarine Program for Australia.”

The new submarines will be known as Attack-class, according to an earlier announcement. The lead boat – HMAS Attack – is scheduled to be delivered in the early 2030s.

The new submarines are to replace Australia’s current six Collins-class submarines, first of which is set to retire in 2026.

Critics have warned that Australia is facing a submarine capability gap because the first Collins-class submarine will retire way before the first Attack-class submarine is delivered. An Insight Economics report from 2017 argued that a price of over AU$3 billion per submarine was too expensive for a conventionally-powered submarine with no air-independent propulsion system. Purchasing off-the-shelf submarines was a more sound option, the report argued.

Construction of Attack-class submarines is part of an AU$90 billion National Shipbuilding Plan, which will see 54 naval vessels built in Australia, to meet the strategic requirements set out in the country’s 2016 defense white paper.