Definitely need a like button.Okay... Where to start, where to start, keeping in mind the Mods are watching this thread and not especially pleased with the degree of, or lack thereof, thought that people are putting into some of their posts.
The first is that without an up to date DWP and DCP, much of this is speculation and guesswork, with occasional input from the Wag Institute.
First, it seems there are some misunderstandings and misconceptions which need to be addressed and cleared up.
First has to do with costings. Australia, unlike a number of other nations, do an estimated "whole-life" cost for a piece of kit/programme, whether it is a ship, aircraft, or tank. This is where it can be quite different from the cost of a US defence programme, which the cost of an AB DDG is the actual purchase price of it just to enter service. It has been mentioned a number of times here and elsewhere, that the US is/has been looking at the Australian costing model, because of what it helps keep account of and track. The actual, straight cost to buy (flyaway cost for aircraft typically) is usually around one-half to one-third the total programme cost for Australian defence programmes. The SLEP or MLU which is typically done for major pieces of kit (aircraft, warships, etc) at the midpoint of the respective service lives, along with various other upgrades and modifications done is usually also about a third of the total programme cost, or nearly the cost to actually purchase the kit in the first place. The final (typically another third) is the anticipated operating cost. In some cases, the divisions are a bit different, depending on the initial cost, and/or how long kit is kept in service, etc.
Next up is the bit about paying a 'premium' for having kit built in Australia. It depends on the type of kit. For some things, like tanks and aircraft, the cost just is not worthwhile. Australia has assembled modern(ish) fighters from knockdown kits, but that is not the same as actually having an actual production line, and from an economic standpoint, Australia does not the volume to sustain combat aircraft assembly. France as an example, has placed only enough orders for Dassault to keep the Rafale production line going at the rate of about one per lunar cycle, or 13/year. This was done to make sure the line stayed open, but IIRC the production costs were approximately those of a LRIP Rafale. For tanks, I forget the exact numbers but the costs to setup a modern production line, design, manufacture tanks, etc. would require something on the order of 1,000+ units ordered to reach the breakeven point. Realistically, only Germany and the US (from the Western nations) have had order volumes which approached or exceeded those numbers, and of the friendly/allied Eastern nations, only South Korea has reached that number with production of their MBT. With Australia having had 100 tanks or less in service and stockpile following the end of WWII, setting up to produce tanks also seems a bit senseless.
Ships are a bit different, since there is some domestic shipbuilding an maintenance, as well as a need for an organic capability to repair/modify RAN vessels. Now for the actual premium bit. Before, during part of the natural resources/rawmat mining boom, a 30%+ premium would still have been economically viable for warships produced in Australia.
What that meant at the time, is that the net economic cost to Australia for a AUD$1.3 bil. DDG built in Australia, was approximately the same as an AUD$1 bil. DDG built overseas and 'imported'. The reason an Australian-built warship could cost AUD$300 mil. more and have the same economic cost, is that all the extra costs associated with buying 'in Australia' would get recouped via taxes paid on the economic activity generated by the Australian build. Taxes paid directly by the shipyard workers is obvious, but also by the various parts suppliers supporting the shipyards, and of course taxes paid by employees of those parts suppliers. Then of course there is the economic activity all those employees and their companies generate, and so on.
Last (for now) I will cover maritime aluminum construction. Austal does have a reputation as being amongst the world's best at working with maritime grade aluminum. Now, if a large OPV-sized vessel was desired, it could be constructed out of aluminum. However, to get the sort of size/strength desired for most OPV's using aluminum, extra work needs to be done, which ends up negating many of the weight/displacement advantages aluminum has in small vessels. Making matters worse, it is hard to work with and more expensive than steel. Therefore, what might be appropriate for a vessel just would not work for larger vessels in most cases.
More later.
I would only add that the calculation of cost benefit to the Australian economy needs to include the amount of skilled labour required and what those workers would be doing otherwise.
During the ANZAC project the workers were the same who had delivered the Australian Frigate Project, were already trained and experienced, working for an established and experienced organisation at a recently upgraded existing facility, in conjunction with a competent designer who was highly experienced in supporting foreign builds and also the project had been planned and evolved for years before hand.
The corresponding submarine project involved a new builder, work force, facility and a designer, that had never worked on on open ocean sub or exported any design, in fact they had only ever worked very closely with one particularly knowledgeable and proactive customer. There was also a completely inexperienced combat system designer that was independent of the prime contractor and often defended by the customer, even though they consistently failed to deliver. Compare the two projects and the amount of funding and effort to deliver the required capability.
The other fact is at the time these projects were running the Australian economy was more balanced, the dollar was lower and there was no skill shortage. By the time the AWD project kicked off much of the capability and momentum gained had been lost and the the government capped this off by first awarding FFG UP to Thales instead of Tenix then AWD to ASC, again instead of Tenix. A new facility had to be built, a designer that had never exported a design or supported an overseas build was selected. Also, in the middle of a never before seen mining construction boom and associated skill shortage, a new work force had to be hired, trained and certified. Perhaps the most damning is there appears to have been nowhere near the level of planning and preparation that the earlier projects received. Is there any doubt why there have been issues?
Now this work has been done it appears we have let momentum be lost again through the decision to build the new AORs offshore. A local build would have involved sufficient steel bashing to keep ASC, BAE (they bought Tenix's defence operations after Tenix lost the AWD bid) and Forgacs busy until the OPVs and frigates came on line. A fourth AWD would have been sensible as well but the AORs would have been sufficient.
Now the economy is returning to it's pre-boom base, minus a number of industries that were not adequately protected from what was obviously a temporary economic distortion, the factors determining the efficiency of a local build are returning to normal as well. The situation now is more like those in the late eighties than the early 2000s meaning many assumptions made about costs and efficiencies probably need to be reassessed. Actually, the governments changing stance on continuous builds and the possibility of local construction of the future submarines suggests that just such a reassessment has occurred.