DCNS of France wins the CEP

After years of effort, as of April 27 we finally have a design partner for the Future Submarine project

28th Apr 2016


SEA 1000

 

DCNS of France wins the CEP

 

Kym Bergmann / Canberra

 

 

After years of effort, as of April 27 we finally have a design partner for the Future Submarine project – one of the western world’s great naval designers and builders: DCNS.  France has always produced exceptionally high quality undersea naval equipment and it should be remembered that the Collins Class – specified to achieve a “best of breed” outcome – has a number of French systems on board, including Thales (the sonar suite); Sagem (Inertial Navigation System); and Jeumont Schneider (main electric motors).

 

The full reasons for the selection of DCNS with the approximately 5,000 tonne ‘Shortfin Barracuda’ Block 1A will probably never be known publicly, but high on the list is that the company has offered an extremely modern design with a lot of growth potential – coupled to a proven record of constructing hulls of this size and larger.  The company also has a good reputation on the export front – and has previously enthusiastically embraced transfer of technology agreements with its various international customers.  It also has the full support of the French Government and the Marine Nationale.

 

Like the other bidders, DCNS has been blocked by the Australian DoD from describing the specifics of their CEP offer.  However, it is highly significant that they chose to base their bid on an existing hull in the form of the nuclear powered ‘Barracuda’ SSN rather than a scaled up diesel-electric ‘Scorpene’.  There are several reasons for this.  Even though the French Navy ‘Barracuda’ – six are on order - will require significant modifications to convert to diesel-electric propulsion, DCNS engineers presumably concluded that this was a less risky path to go down.  Secondly, the Marine Nationale does not operate conventional submarines – meaning that only a ‘Barracuda’ could come with French parent navy support.  Finally, it is most unlikely that France will ever sell a ‘Barracuda’ to anyone apart from Australia, thus addressing one of the RAN’s longstanding hang ups that our future submarines must be unique and not be found in the inventories of other regional powers.

 

To this can be added a statement in the 2016 Defence White Paper at 4.29 that:

 

“As part of the rolling acquisition program, a review based on strategic circumstances at the time, and developments in submarine technology, will be conducted in the late 2020s to consider whether the configuration of the submarines remains suitable or whether consideration of other specifications should commence.” 


 

This might be code for Australia being prepared in the future to consider a switch to nuclear propulsion, in which case the selection of DCNS as a design partner makes perfect sense.  As it happens, through its close association with the nuclear powered USN submarine fleet and now the nuclear powered French submarine fleet, the RAN will become a de facto member of a very exclusive club of navies that utilize this technology.

 

The selection of DCNS probably came as a surprise to many observers since a lot of attention had understandably focused on the offer from the Japanese Government.  This was because of the sheer novelty of military technology sourced from that country, combined with the highly unusual – and controversial – origins of their involvement based on the perception that they were the preferred choice of the Prime Minister at the time, Tony Abbott.  The German company TKMS also seemed to have a higher profile and were very vocal up front about their intention to build all 12 submarines in Adelaide.  DCNS adopted more of a wait and see approach, though initially advocating that a hybrid build was the fastest and least costly way to proceed. 

 

Even though Defence managed the process very carefully with no major leaks, astute watchers of the submarine space would have noticed a curious article by Greg Sheridan, the Foreign Affairs editor of ‘The Australian’ on April 9, when he suddenly departed from his traditional pro-Japan, pro-Tony Abbott line and instead wrote of the need for Australia to consider all three bids seriously, adding prophetically that the Government would choose the most capable submarine being offered.  Even more curiously for the occasionally well-informed Sheridan, he wrote highly of the French bid, including a reference to their low profile Australian CEO that must have made him blush:

 

“Nobody more perfectly embodies the complexity and epic quality of this choice than Sean Costello, the CEO of DCNS Australia, the French government owned company which is the French bidder.”

 

Clearly, something was going on.

 

There were few other indications of what Defence had recommended, apart from some reporting that the Japanese had fallen out of favor at much the same time.  Again, the reasons for this are highly speculative but might be related both to Japan’s lack of export experience, coupled with the extreme reluctance of Tokyo to agree to Intellectual Property access and ownership.  This last point alone had the potential to eliminate Japan from the race.  The reasons for DCNS being preferred ahead of the slight favorites TKMS are equally opaque, but might be related to France being able to offer highly advanced systems found on a nuclear submarine, such as propulsor technology.

 

 

And despite the usual mainstream media hysteria and lack of attention to detail, there is still a long way to go in all of this.  DCNS have not yet been awarded a contract for anything – let alone for a $50 billion order.  This number, by the way, is just plain silly and it amazes APDR that politicians including the Defence Minister and Prime Minister continue to boost it in public, because no one has explained what it includes.  The eventual acquisition cost will only be calculated when a design has been finalized  – and without that it is impossible for anyone to be specific about how much Australian taxpayers will be forking out a decade from now.

 

The next step is for Defence and DCNS to negotiate an initial contract that will lead to the detailed design of the submarine.  Even getting to this next stage will take several months since the RAN will have to start being specific about performance parameters because then it will be necessary to make hard decisions about cost – capability tradeoffs.  An early example is going to be whether the RAN wants air independent propulsion (AIP), or whether it is happy for a World War II type solution that will require the submarine to come to the surface and snort every two or three days.  Uniquely in the western world, the RAN has to date shown little interest in AIP, apparently believing that they are better off being able to carry some extra pallets of provisions instead of having the capacity for sustained underwater endurance – but that could change, especially if they are serious about wanting a “regionally superior” conventional submarine.

 

Another very worthwhile feature of the selection of DCNS is that it finally puts to rest the whispered suggestion that somehow the United States has a problem cooperating with French companies – or sharing sensitive technology with Paris.  These rumors have always been difficult to come to grips with, because of course no U.S. official who wanted to keep his or her job were prepared to be identified as the source of such comments, if indeed they were ever made.  Nevertheless, it has been occasionally asserted that Washington would be unhappy if Australia chose DCNS and would be reluctant to share combat system and weapon technologies.  Given the number of people from the U.S. who participated in the CEP evaluation, we can now safely call these rumors for what they are – total nonsense.

 

The forthcoming detailed design phase is likely to last between three and five years – and at its peak could involve as many as 500 highly skilled DCNS personnel, mainly located in Cherbourg.  If the RAN follows the same methodology as the French Navy – which would seem prudent – they will be involved in a highly interactive process that involves dozens of working groups.  As the writer witnessed during a visit in October last year, by making extensive use of 3D modeling and virtual reality tools, the nuclear powered ‘Barracuda’ is being designed in an iterative manner that means what is being constructed is exactly what the customer wants.  However, for this to work to maximum effect the RAN will need to find sufficient numbers of experienced submariners to participate – and in addition they will need to have professional and cooperative personalities, which in France are the norm rather than the exception.

 

In parallel with the detailed design process a large number of other tasks will need to begin.  These will include infrastructure work at Osbourne – and most importantly the identification and qualification of a myriad of suppliers, both large and small.  In this task France will be greatly helped by the strong in country presence of Thales – which owns 27% of DCNS – and other high technology French defence suppliers such as Sagem.

 

Another big decision that will need to be taken in the lead up to construction is the serially delayed privatization of ASC.  Since it is the designated builder, DCNS can only realistically hope to control price and quality is if it has control of construction.  To effectively subcontract that to a Government-owned entity will be to risk cost and schedule overruns, such as those we are currently witnessing on the Air Warfare Destroyers.  What the Government will receive from the sale of ASC – at most a few hundred million dollars – is peanuts compared to the savings to be gained by having the future submarines constructed efficiently.  Having said that, DCNS is itself partially Government owned with the French state holding 62% of the shares – but it has a corporate culture that goes back more than 350 years and has been operating as a fully private company for more than a decade.

 

The choice of DCNS might have surprised some, but it is an inspiring selection that dwarfs any previous efforts at Franco-Australian collaboration.  Knowing the French, they will collectively throw themselves at the many challenges with all of the energy and creativity that they can muster – and that is a lot.

APDR at a glance