Royal Australian Navy Discussions and Updates

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Todjaeger

Potstirrer
[Serious question not rhetoric] I'm sorry I'm not understanding, if Navantia spanish condition isn't that important why aren't you just buying the IP proprieties and build it yourself?

Like the Canadian Ice Breaker, the Canadians just bought the design from our Norwegian Vard branch and they built it themselves. Another example is the T-129 the Turkish Mangusta derivative after we sold to them for 1,4billions the A-129 tech data.

So why the need of Navantia?
It is a bit more complicated than that. However, that is similar to what was done with the Collins-class SSG ANZAC-class FFH, the Hobart-class DDG, will be done with the SEA 1180 OPV, and so on.

As I understand it, the CoA purchased the IP rights to build a certain number of each of the classes of vessel that were (or are to be) built in Australia, as opposed to complete IP rights. The principal difference AFAIK is that complete ownership of the IP rights would permit the CoA (or any other IP owner for that matter) to build and/or modify the IP/designs as much as they would like.

Using the SEA 5000 Future Frigate programme as an example, whichever design (British, Italian, or Spanish) gets selected, the vessels themselves will be assembled in an Australian facility (Techport) in Osborne. The company which is operating the facility might change, but it will still be an Australian facility, as will the other shipyards in Australia which might get block work.

Unlike Navantia's involvement in the Canberra-class LHD builds, or the upcoming replenishment oiler, during the Hobart-class AWD build Navantia was just involved in the design and ship plans though Volk would be much better at explaining what they did. For the Canberra-class LHD, the basic vessels were built in Spain, because Australia has not had a yard available for constructing naval vessels of such size since the Cockatoo Island yards shut down in 1992. Once the vessel's hull, machinery and superstructure were built and assembled, the vessels were transported to Australia for fitout.

With that in mind, what the RAN seems most interested in is the design work, and how suitable a design is within the Australian context for the SEA 5000 Future Frigate. The state of a foreign company's overseas shipyards, yard workforce, or balance sheet is irrelevant, unless it impacts the ability of the design team to put together plans for the type of frigate Australia is seeking, fitted with the kit Australia desires.

From my outsider's non-industry perspective, a design team that already has significant experience putting together designs which Australia is already somewhat familiar with, that also tends to feature much of the same kit Australia is going to use, is likely to have an edge.

With respect to comments regarding the EU, I do not see how they are realistically applicable. Aside from the assumption that any EU competition rules also include national security exemptions, none of the actual SEA 5000 build work is going to occur outside of Australia. So unless someone could make a credible claim that Italy, Spain, or the UK were going to subsidize (to one degree or another) an Australian frigate build programme, provided their respective national design was selected, then the EU competition rules should not matter.

This is not like the trade disputes which have been occurring between Airbus and Boeing over the cost of civilian airliners and resulting competition for orders. In the Airbus/Boeing trade disputes, civilian airlines have sought certain classes of airliners which both companies produce, and therefore the airlines have at least partially based their selection decisions on the initial acquisition and operating/support costs. These costs (initial acquisition especially) can be influenced or impacted by gov't policies on taxes, subsidies, etc. which impact the cost to either Airbus or Boeing to actually produce an individual aircraft or part. With the Australian National Shipbuilding plan having RAN ships built in Australia except for vessels too large to be built in current Australian yards, all those production costs which can be subject to influence from gov't policies are subject to Australian gov't policies, not those of the various national gov'ts belonging to the home countries of the designers.
 

Joe Black

Active Member
More on the OPV...

https://venturaapdr.partica.online/...ins-key-role-in-construction-starting-q4-2018

Some key info on the OPV:

Lürssen’s Australian OPV80 variant will be 80 metres in length, have a 13 metre beam, a draught of 4 metres, and displace 1700 tonnes.

The vessels will be fitted with a 40mm gun for self-protection, three 8.4m sea boats, state of the art sensors as well as command and communication systems. This will allow the OPVs to operate alongside Australian Border Force vessels, other Australian Defence Force units and regional partners.

One feature new to Navy is the placement of a rapid interceptor ramp, whereby a sea boat can be launched within one minute of being manned, down a sloping stern access to the sea. Recovery is by means of the same ramp.

The vessels will accommodate up to 60 personnel, including a crew of around 40 Navy personnel and will accept modular mission packs such as unmanned aerial systems. These may be contained in two TEU containers on the flight deck, which can otherwise land an RAN MH-60R medium helicopter. With no hangar available, the Romeo helicopter can only visit!
 

Todjaeger

Potstirrer
I have a Q for the experienced members here.

Have governments, not just Australia's, ever increased the number of naval vessels built because the tender was just that good? I'm thinking - no, but I don't follow other countries closely.

Eg if navantia wins, they save a lot of time and testing ( was it assail who said something like testing the steel is already done for the Hobart's, staff are already trained, etc) , so the $35bn might conceivably stretch to 11 ships, instead of 9.
It would depend on how you view things. Realistically though the only Western country which like builds naval vessels in sufficient quantity to make such a difference is the US.

Using the RAN as an example, there is a certain sized body of personnel who can be utilized to crew the various RAN vessels and shore establishments. If suddenly an extra two frigates could be added to the fleet, that would likely cause at least two frigates (possibly even more) to be tied up alongside in 'Extended Readiness' as the RAN has the personnel numbers to operate ~12 major surface escorts, and not 14.

From my perspective, the only time such a circumstance would be worthwhile to pursue if one were to know beforehand that at times there should be vessels unavailable due to extended repair or upgrade times that are measured in years. After all, it 'extra' vessels are acquired at no additional initial costs, having a larger fleet will have higher ongoing support costs, especially future upgrade costs.
 
Hmm, really

This contract combined with F110 that Spain have in the wings along with the BAM build and ongoing commercial work may actually ensure the company becomes viable. That will certainly drive behaviour ..... but possibly not in a negative fashion. If the F-5000 gets up there will be 17 F100 derivatives in service ..... that has benefits in developing upgrades and ongoing sustainment.

The other big point is we have got CEC on the Hobart DDG and the USN has got quite a bit of exposure assist in the build and operating with the F100/105 vessels and the Hobarts. Makes them a known quantity which is a selling point for FFG(X).

Mind you .... the need to keep Marinetta Marine going may see the FREMM prevail.
Very right!

Add to that the engineering of the Turkish LHD and the 5 billion contract to build 5 corvettes + port facilities to Saudi Arabia.

Lets not forget that Navantia is 100% owned by the Spanish government in what is considered an strategic sector, so the Spanish government will do what it has to to ensure it remains that way.
It has been a tough few years (Worldwide) but right now Navantia Spain has under construction two BAMs, Two AORs for Australia , four S80 (finally on their way) and very shortly 5 F110 and 5 corvettes based on the Avante class to SA . The gap is gone.
Top that with Navantia Australia Sea 5000 tender and Navantia Australia leading the efforts in Canada + The FFG(X) and the future does not look as bleak as some people would like to paint it.
 

John Fedup

The Bunker Group
[Serious question not rhetoric] I'm sorry I'm not understanding, if Navantia spanish condition isn't that important why aren't you just buying the IP proprieties and build it yourself?

Like the Canadian Ice Breaker, the Canadians just bought the design from our Norwegian Vard branch and they built it themselves. Another example is the T-129 the Turkish Mangusta derivative after we sold to them for 1,4billions the A-129 tech data.

So why the need of Navantia?
Canada has not built any heavy icebreaker yet.
 

Meriv90

Active Member
What I'm going to write is an answer to the question of Spanish state and Navantia solidity it isn't relative to the RAN.
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First. Order book doesn't imply returns. One could even say by looking to the graphs (if we ignore the "correlation doesn't imply causality") that the bigger the order book the bigger the loss.

For example Fincantieri reached just now positive returns, with a 30bln order book behind it... 3 times more than Navantia.

This is from the Spanish newspapers i read and I'm no expert

Navantia is a pubblic shipyard, with public rules. Thus at the base of the problem we have incompetent managers, that keep increasing in numbers and salary regardless of the company loss.

It is the same Galicians that say so

Navantia multiplica el número de altos cargos pese al récord de pérdidas

For the same reasons market competition don't apply to it, so having 50% of workers over 50year old is possible. (again spanish newspaper ask for source if needed) .

Second. It isn't immune to the EU rules, it has already been found guilty of state aid in the past.

El Tribunal de Justicia de la UE asegura que las ayudas a Navantia pueden ser ilegales

https://www.eldiario.es/galicia/justicia-Navantia-librarse-IBI-Ferrol_0_348215912.html

http://europa.eu/rapid/press-release_IP-04-633_en.htm

Today the European Commission decided that aid provided to the public Spanish shipyards is not in line with EC rules on State aid to shipbuilding. The Commission has established that State holding company Sociedad Estatal de Participaciones Industriales (SEPI), in 1999 and 2000, granted aid worth €500 million to the civil public shipyards that are today all owned by IZAR. The aid took the form of a capital injection, loans and a purchase price above market value. As the loans amounting to € 192.1 million to SEPI were paid back, the sum to be reimbursed will amount to € 308.3 million, plus interest. The Commission concludes that the above amount constitutes further state aid which, after the approval of a final restructuring package, can no longer be approved under the EU shipbuilding aid rules.
As you can see the spanish goverment has been state aiding Navantia for the last 20 years.


P.S. Todjaeger thanks for the answer :) and thanks to Jonh Fedup for correcting me
 

Todjaeger

Potstirrer
u can be sure this will be a MAJOR consideration as it drives behaviour and costs in the sustainment phase

its a 2 horse race fremm and t26 with t26 the front runner degraded by its own government such that fremm has to be the winner with t26 a runner up but still a possibility if the risk appetite is higher lets not forget the navantia option has already failed an evaluation

lets also not forget FREMM = 2 Helo plus Fincant Industrial
How would any economic issues going on with Navantia in Spain impact the RAN's sustainment costs, when the work done for the RAN will be carried out in Australia by Australian workers and yards?
 

ASSAIL

The Bunker Group
Verified Defense Pro
Apparently Australian auditors like doom and gloom reports, just like their Canadian counterparts. Can't really comment on the validity of the report but I have think the Australian approach is less risky assuming Australia and Canada choose either the Navantia or T26 design.

Audit: Australian multi-billion shipbuilding plan carries extreme risk
Those risks are to cost, schedule and industrial capacity not to commercial viability and as in every national enterprise such as the $90billion shipbuilding plan, these risks are manageable
 

Meriv90

Active Member
Unfortunately the Navantia presence is big enough to cause problems, word is the Spanish concept of quality and accountability isn't quite up to the Australian and US ones. As part of the contract with navantia many key roles were assigned to their managers with the incumbent Australians pushed sideways or made redundant, irrespective of the performance, as a result sadly a number highly skilled and experienced locals are no longer in the industry.
By quoting Volk, if problems arise in Spain for Navantia and they must cut personnel they could end up cutting employees assigned to the Australian project.

Navantia presenta a los sindicatos la fórmula para rejuvenecer la plantilla

El 68% de los 5.283 empleados tiene más de 50 años. En el caso de las tres plantas de la Bahía de Cádiz la situación es aún más preocupante, ya que el 30%, unos 517 trabajadores, está por encima de los 60 años. Los astilleros de Fene y Puerto Real concentran las plantillas con más edad. La edad media en la planta gallega es de 56 años, mientras que en la gaditana es de 54.
Many situations pass trough my head. You could have your Australian manager promoted to a Spanish higher position, or your Australian manager simply retires without a replacement ready etc... etc...


The good side is it would mean more job for locals.
 

hairyman

Active Member
It would depend on how you view things. Realistically though the only Western country which like builds naval vessels in sufficient quantity to make such a difference is the US.

Using the RAN as an example, there is a certain sized body of personnel who can be utilized to crew the various RAN vessels and shore establishments. If suddenly an extra two frigates could be added to the fleet, that would likely cause at least two frigates (possibly even more) to be tied up alongside in 'Extended Readiness' as the RAN has the personnel numbers to operate ~12 major surface escorts, and not 14.

From my perspective, the only time such a circumstance would be worthwhile to pursue if one were to know beforehand that at times there should be vessels unavailable due to extended repair or upgrade times that are measured in years. After all, it 'extra' vessels are acquired at no additional initial costs, having a larger fleet will have higher ongoing support costs, especially future upgrade costs.


Surely the RAN could up its recruiting and training extra sailors to accommodate two extra ships, as it would take several years to build two additional ships, it would not happen overnight.
 

pgclift

Member
Those risks are to cost, schedule and industrial capacity not to commercial viability and as in every national enterprise such as the $90billion shipbuilding plan, these risks are manageable

Agree with that conclusion.

In summary, the stated audit objective was to assess the effectiveness to date of the DoD’s planning for the mobilisation of its continuous shipbuilding program in Australia and the audit does not seek to provide assurance on the detailed management and progress of individual programs or platforms.

In respect of the main audit objective, the report is generally favourable.

However, the ANAO had made a finding that (regardless of the selected option) “A key potential risk relates to any decision to integrate the Aegis Ballistic Missile Defense capability into the selected frigate, which would require significant development work and be a departure from the Government’s guiding principle of minimising unique Australian design changes”.

Interestingly the ANAO does not make any recommendation about ABMD integration risk (and as Assail has inferred), the only recommendation from the audit relates to defence revisiting the 2016 White Paper costings to update the affordability of the 2017 Naval Shipbuilding Plan.

Defence has rejected that recommendation.

The report is available by searching ANAO, Performance Audit, Naval Construction Programs -Mobilisation and if the link works it’s at:

https://www.anao.gov.au/work/performance-audit/naval-construction-programs-mobilisation
 

Todjaeger

Potstirrer
By quoting Volk, if problems arise in Spain for Navantia and they must cut personnel they could end up cutting employees assigned to the Australian project.

Navantia presenta a los sindicatos la fórmula para rejuvenecer la plantilla



Many situations pass trough my head. You could have your Australian manager promoted to a Spanish higher position, or your Australian manager simply retires without a replacement ready etc... etc...


The good side is it would mean more job for locals.
Could that happen? Sure. Is it likely? IMO, and having gone through a couple of layoffs, no. In my experience, personnel who get laid off tend to be people in positions that are either no longer productive, no longer profitable, or can be replaced by other personnel who can perform the same functions for lower wages.

This is why places like shipyards tend to layoff the yard workers when there are no open orders booked, and then reduce the management staff when the pool of yard workers shrink and there are less people to manage.

As I understand it, the Australian-based subsidiaries of overseas ship builders (BAE, Fincantieri, Navantia) are going to have their Australian subsidiaries doing some design and certification work, QC and possibly some design modification as needs are dictated by the build programme. Once their work for the SEA 5000 project is done, then I would expect they would either be reassigned to other projects, or change companies, depending on what opportunities are available, where, and the required skills/qualifications. Keep in mind that a fair number of all the Australian subsidiary employees are Australian and that the foreign companies have to abide by Australian employment laws with regards to the employees of their Australian subsidiaries.

In short, rather than continue with a discussion on the potential economic forecasts for Navantia which would be unlikely to have an impact on RAN projects, how about we confine discussion to the RAN.
 

Todjaeger

Potstirrer
Surely the RAN could up its recruiting and training extra sailors to accommodate two extra ships, as it would take several years to build two additional ships, it would not happen overnight.
The construction of two additional vessels would not happen overnight, that is true. However it can take quite some time to train the various personnel which would compose a frigate's crew. I am not really referring to the junior officers and enlisted sailors, but more the senior officers and chiefs. Having looked over the service histories of the current ANZAC-class FFH captains, they all have had over 20 years of service prior to assuming command of a frigate. Assuming that is the level of experience that the RAN wants for CO's, unless the RAN has 'extra' staff officers with that level of experience that are also in command tracks, then the RAN might have difficulty getting two extra frigate CO's with the same degree of experience. The same goes for other positions of significant importance like the XO, chief engineer, chief petty officers and warrant officers. Basically the ranks and roles that take service members years of service and experience to attain.

As for building two extra frigates, unless the programme contract has options to purchase/build additional units, whatever the number is likely to be the limit. If all the sudden it was determined that the RAN (or anyone else for that matter) could spend the same amount of money to get an extra two vessels, that realization would likely not come until towards the end of the planned build cycle, perhaps 36 months before the completion of the last planned vessel. By that point, there is likely going to be a max of perhaps six years before the last 'extra' vessel would be in service and requiring a crew. The first 'extra' vessel would likely be requiring a crew in 4.5 years or less after the decision to order extra vessels is made.

4.5 years should be plenty of time for additional Seamen, Able Seamen, and Sub Lieutenants to be recruited and trained (provided of course that the budget and permission is granted to swell the numbers of RAN personnel) but I suspect that finding appropriate Commanders, Lieutenant Commanders, and Chief Petty Officers from within the current RAN ranks could be more problematic.
 

CB90

The Bunker Group
Verified Defense Pro
Agree with that conclusion.

In summary, the stated audit objective was to assess the effectiveness to date of the DoD’s planning for the mobilisation of its continuous shipbuilding program in Australia and the audit does not seek to provide assurance on the detailed management and progress of individual programs or platforms.

In respect of the main audit objective, the report is generally favourable.

However, the ANAO had made a finding that (regardless of the selected option) “A key potential risk relates to any decision to integrate the Aegis Ballistic Missile Defense capability into the selected frigate, which would require significant development work and be a departure from the Government’s guiding principle of minimising unique Australian design changes”.

Interestingly the ANAO does not make any recommendation about ABMD integration risk (and as Assail has inferred), the only recommendation from the audit relates to defence revisiting the 2016 White Paper costings to update the affordability of the 2017 Naval Shipbuilding Plan.

Defence has rejected that recommendation.

The report is available by searching ANAO, Performance Audit, Naval Construction Programs -Mobilisation and if the link works it’s at:

https://www.anao.gov.au/work/performance-audit/naval-construction-programs-mobilisation
Retrofitting BMD capability to an existing AEGIS ship has been performed on numerous AEGIS baselines, across multiple navies, in varying levels of capability (sensor/shooter vs sensor only).

Biggest risk would be use of CEAFAR, as that's where the development/testing would have to occur.

But it would be an odd choice if low risk and rapid transition to capability were desired. It'd be a much easier addition to a planned SEA 4000 modernization program.
 

StingrayOZ

Super Moderator
Staff member
In the case of the F-5000. It is a design not yet built. There is on going development and design work as well. That is one of the big pieces of the continuous ship building program, is our own ship design.

With the F-5000 design, I don't see Australia being particularly dependent on Navantia (Spain). Navantia Australia will handle basically everything we need, and as we have already build the AWD's and are quite familiar with the design I would say it is pretty fairly low risk from the exposure of Navantia being a Spanish company. I believe the design is very similar below the deck line by the way of structure.

I don't think the commercial profitability of any company will play a big part. It will be the gadget itself.

Surely the RAN could up its recruiting and training extra sailors to accommodate two extra ships, as it would take several years to build two additional ships, it would not happen overnight.
There is a real possibility of a large scale conflict occurring during this build period (and Sea1000). We should have plans to increase production or surge it (if only for a short period). It is possible (if somewhat unlikely) other Navies might also want something we might be building, in that case. (or we might be tempted to build a ship, even if we don't intend to crew it immediately, as part of a deterrent strategy).

In terms of crewing additional RAN ships, I would assume in a realistic conflict scenario, crews can be found and funded to some extent if given time (which would be needed to build ships anyway).

I would imagine Australia would go on a mission to pinch/find/relocate/bring out of retirement key officers globally in that kind of situation.
 

oldsig127

The Bunker Group
Verified Defense Pro
Unlike Navantia's involvement in the Canberra-class LHD builds, or the upcoming replenishment oiler, during the Hobart-class AWD build Navantia was just involved in the design and ship plans though Volk would be much better at explaining what they did. For the Canberra-class LHD, the basic vessels were built in Spain, because Australia has not had a yard available for constructing naval vessels of such size since the Cockatoo Island yards shut down in 1992. Once the vessel's hull, machinery and superstructure were built and assembled, the vessels were transported to Australia for fitout.
Details only, but the LHD superstructures were constructed in Australia and then added in Melbourne during the fit out process.

oldsig
 

aussienscale

The Bunker Group
Verified Defense Pro
FYI for anyone interested

For all those interested, the new HMAS SYDNEY V (DDG-42), the third and last of the three Air Warfare Destroyers will be launched this Saturday. You can view the launch live at the link below from 0945 until approximately 1100 (SA time I believe, so add half an hour). Enjoy: An error has occurred…/

Copied and pasted from Task Force 72 Facebook page

Cheers

P.S. Guessing the link should work on the day :)
 

MickB

Well-Known Member
4.5 years should be plenty of time for additional Seamen, Able Seamen, and Sub Lieutenants to be recruited and trained (provided of course that the budget and permission is granted to swell the numbers of RAN personnel) but I suspect that finding appropriate Commanders, Lieutenant Commanders, and Chief Petty Officers from within the current RAN ranks could be more problematic.
Thank God for Canada.
But seriously I imagine that most Navys have more command qualified officers than ships. So if the need was there perhaps we could stretch.
 

alexsa

Super Moderator
Staff member
Verified Defense Pro
FYI for anyone interested

For all those interested, the new HMAS SYDNEY V (DDG-42), the third and last of the three Air Warfare Destroyers will be launched this Saturday. You can view the launch live at the link below from 0945 until approximately 1100 (SA time I believe, so add half an hour). Enjoy: An error has occurred…/

Copied and pasted from Task Force 72 Facebook page

Cheers

P.S. Guessing the link should work on the day :)
Yep and looking forward to seeing the bits of the OPV coming together on the hard stand. Sad to see the politicking is still going on around the building plan and I hope a change of government does not see it fiddled with for the same of putting a Labor stamp on it.
 
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