Australia’s Submarine Decision: Concerns Down Under, Celebrations in Paris
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France’s share of the prospective deal is €17 billion (US $19.5 billion), according to sources close to defense minister Jean-Yves Le Drian, weekly Le Point reported, while Reuters reported some €8 billion (US $9.2 billion) for DCNS. DCNS chairman Hervé Guillou welcomed the support from the Direction Générale de l'Armement procurement office, Navy chief of staff Adm. Bernard Rogel, Thales, Sagem, and Schneider Electric, a French energy company with a significant business presence in Australia.
The deal is also a win for Thales, holder of 35 percent of DCNS, with the French government holding the remainder. Thales' share of the Australian program is expected to be some €1 billion (US $1.2 billion), with €100 million ($115 million) per sub based on the sale of sonar systems, electronic warfare and periscopes, a Thales executive said.
With the selection of the French proposal, negotiations will begin for a three-year submarine design contract, said Marie-Pierre de Bailliencourt, DCNS executive vice president for development. A contract agreement is expected later this year or early in 2017, she added.
More choices remain for the submarine program, which is specified to have a US combat systems integrator and employ US weapons. Australia reportedly is considering bids from Raytheon and Lockheed Martin [emphasis added]— each already working on the Royal Australian Navy’s Air Warfare Defense destroyer, fitted with Lockheed’s Aegis radar with integration from Raytheon.
Installing a US combat system is one of the reasons for building the subs in Australia rather than France, as there is sensitive technology involved [emphasis added, nice justification for high cost of build domestically], said Robbin Laird of consultancy ICSA, based in Washington and Paris. “It will be interesting for Thales” in Australia he said, as the Australian subsidiary of the French electronics company will work closely with DCNS and the US combat systems integrator.
One of the issues to be worked through is guarding US technological secrets. DCNS has never worked with a US company on this scale.
“I can’t help but think that the US Navy has considered the full intellectual impact on any of the platforms that might be selected,” observed Guy Stitt of AMI International. “I think the Australians will have a process that assures that US intellectual property will be protected.”..
http://www.defensenews.com/story/defense/2016/04/29/australia-submarine-dcns-france-hollande-turnbull-stitt-davies-germany-japan-tkms-mitsubishi/83713442/