F100 visits Sydney
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Under the SEA 4000 Air Warfare Destroyer program, Australia plans to replace its retired air defense destroyers with modern ships that can provide significantly better protection from air attack, integrate with the US Navy and other coalition partners, offer long-range air warfare defense for Royal Australian Navy task groups, and help provide a coordinated air picture for fighter and surveillance aircraft. Despite their name and focus, the ships are multi-role designs, with a “sea control” mission that includes area air defense, advanced anti-submarine operations, and the ability to fight other ships.
The Royal Australian Navy took a pair of giant steps in June 2007, when it selected winning designs for its keystone naval programs: Canberra Class LHD amphibious operations vessels, and Hobart Class “air warfare destroyers.” Spain’s Navantia made an A$ 11 billion clean sweep, winning both the A$ 3 billion Canberra Class LHD and the A$ 8 billion Hobart Class Air Warfare Destroyer contracts. The new AWD ships were scheduled to begin entering service with the Royal Australian Navy in 2013, but that date has now slipped to 2016 or so. A 2014 ANAO report examines why – and the answers aren’t pretty…
SEA 4000: The Program
The AWD is needed because Australia’s Adelaide Class (heavily upgraded FFG-7 Oliver Hazard Perry Class) frigates have limited air defense capabilities, and would be hard-pressed to survive against modern anti-ship missiles. All 4 remaining ships are set to retire by June 2019. Planned upgrades to Australia’s 6 ANZAC frigates will deliver a big leap ahead in their capabilities, but they still won’t be suitable for protecting an entire task force by themselves in high threat areas. Nor will they have the potential to grow into ballistic missile defense roles, which are acquiring new urgency in the 21st century. Hence SEA 4000.
In 2001, the SEA 4000 entry in the Defence Capability Plan 2001–2010 contained an initial cost estimate of A$ 3.5 – $4.5 billion. By June 2007, the SEA 4000 cost analysis for a 3-ship, F100 based program was A$ 7.207 billion (A$ 7.929 billion as of December 2013, with inflation and foreign exchange).
That jump was alarming. On the other hand, it’s less expensive than blindly accepting lowball estimates, then having to make ship changes part-way through the build stage. It’s also less disruptive than having to find billions of extra dollars after long-term navy plans are set. Those kinds of surprises are normal in places like the USA, but Australia has undertaken some major defense reforms intended to surface problems, and their likely costs, before the build contracts are placed. That has partly paid off, with a current 2014 estimate of A$ 8.455 billion – just a 6.6% increase over the June 2007 figure.
Unfortunately, the most 2014 ANAO report looked at EVMS data, and concluded that “…major corrective actions were necessary to restore confidence in the AWD build program’s [current] cost and [v2.0] schedule estimates.” See the full timeline below:
There was a contractual option for a 4th ship, but it was declined by the government. See Appendix B for more details concerning the SEA 4000 project’s phasing and timelines.
SEA 4000: The Process
The Problem: The Australian Treasury’s June 2007 Second Pass submission to government estimated an extra A$ 1 billion in costs associated with building the AWDs in Australia, representing an effective rate of assistance of over 30% for naval shipbuilding. Reader will note that this doesn’t square with overall project costs, but shipbuilding usually isn’t even the majority of a warship’s cost.
SEA 4000 Solution: In order to minimize these cost premiums, the AWD was meant to be the product of several competitions, not just one. Rather than taking the conventional approach of securing a prime contractor and having them do the integration and deliver the ship, the Australian government broke up the process into a series of contracts, with each subsequent decision building on the previous ones.
Australia calls the proposed acquisition strategy a “Design Driven” approach, where it contracts separately for design and construction. A designer is contracted to produce a ship design to meet specified requirements, and that design was competed among several shipbuilders offering their platforms as a base, plus one contracted ship design based on the American DDG-51. A winner is chosen, and then a shipbuilder is contracted to build that design.
In theory, the potential contracting strengths of the “Design Driven” strategy include:
The potential to design to a budget;
Greater assurance that the final product will meet the user expectations;
Maximized competition in equipment supply and construction;
More standardization across future shipbuilding projects by having the government instead of the contractor set the key standards;
Maintain a long-term relationship to ensure that through life support considerations are taken into account up front, and vet this before making a design choice.
Navantia’s modified F100 Alvaro de Bazan Class AEGIS frigate won the competition, beating Blohm + Voss’ F124 frigate, and an “Evolved Design” based on the larger American DDG-51 Arleigh Burke Class destroyer. See Appendix A for more details concerning that competition, and the offered platforms.
Unfortunately, the most 2014 ANAO report concluded that these process improvements were only a start. They looked at EVMS data, and concluded that:
“Defence and its industry advisers underestimated the risks associated with incorporating the design changes to Navantia’s F-104 design, exporting that design to Australia, and adapting the designer’s build strategy and processes to accommodate a distributed build at shipyards that lacked recent experience in warship building.”
These conclusions have implications beyond the Hobart Class. Australia is planning a SEA 5000 program to field anti-submarine frigates, as well as an A$ 40 billion program to field up to 12 new-build submarines. Both will try to learn from the SEA 4000 program’s efforts, successes, and shortfalls.
Australia’s Hobart Class AWD
2007 AWD Concept
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Australia’s 7,000t destroyers are based strongly on Spain’s 5,800t F-104 Mendez Nunez AEGIS “frigate”, with some features from the subsequent 6,390t F-105 Cristobal Colon. They also have a few unique Australian features like bow thrusters, a different helicopter hangar and recovery system, and interoperability changes to the combat system.
Australia’s approach to picking their AWD design actually began with a decision about the radar and combat system they wanted. America’s SPY-1/ SPS-62/ SPQ-9B radars weren’t as modern as the European LCF’s APAR/ SMART-L systems, but they have a very strong foothold in the Pacific Rim, and the back-end AEGIS combat system is a well-proven offering that creates interoperability with advanced ships throughout the region. Australia made AEGIS their choice, and a mature trump card called Co-operative Engagement Capability (CEC) even offers them the ability to fire at targets they cannot see, using an American ship’s target cue.
While the Hobart Class isn’t built with Ballistic Missile Defense (BMD) capabilities, it has a proven path. Once new SM-6 missiles arrive in the early 2020s, the ships will be able to intercept ballistic missiles in their last stage of flight, much like the USA’s land-based PATRIOT missiles.
Efforts beyond that will require ship upgrades, and purchases of larger SM-3 missiles that can intercept enemy missiles outside the atmosphere. The US Navy is busy upgrading most of its DDG-51 AEGIS destroyer fleet, paying about $60 million per ship to do so. Similar upgrades have been applied to Japan’s 4 Kongo Class AEGIS destroyers, and their 2 newer Atago Class derivatives are following suit. Korea’s cruiser-size KDX-III AEGIS destroyers face a missile-armed North Korea, and may yet see upgrades of their own. If all parties have also adopted CEC technology, the result will be a powerful pool of fully interoperable, top-tier air defense ships around the Pacific Rim. The following chart offers some comparative perspective:
The USA’s AMDR program offers another potential upgrade. It will use the same X-band AN/SPQ-9 carried by the Hobart Class as a secondary radar, linked to a main AMDR S-band system that uses modern active array radar technologies. The Hobart Class’ onboard power generation is already superior to America’s larger destroyers, and the USA is spending significant R&D funds to overcome important weight and cooling challenges. If they succeed, Hobart Class upgrades could become feasible by the late 2020s.
Other potential upgrades, involving the ship’s weapons, are presented in the Additional Readings sections at the end of the article.
SEA 4000: Industrial
AWD Project management is performed by the Air Warfare Destroyer Project Office, located in Canberra, Australia. The Alliance contract is based on a cost-plus incentive-fee arrangement, under which they receive monthly payments of Direct Project Costs, and incentive fees based on their cost performance relative to a Target Cost Estimate. If there are cost overruns, AWD Alliance members share reductions in their incentive fees.
The AWD Alliance includes ASC Pty Ltd. in Adelaide as the lead Australian shipbuilder, and Raytheon Australia as the combat system integrator. Input comes from an Integrated Product Team (IPT) drawn from the Defence Materiel Organisation, DSTO and the Royal Australian Navy. BAE Australia (formerly Tenix) in Melbourne and Forgacs in Newcastle are the major shipbuilding sub-contractors within the program.
Each destroyer is comprised of 32 ship section “blocks”, which are outfitted with relevant equipment at their home shipyard before they are joined together at ASC’s facility. Key industrial participants, and their contributions, include:
Alliance CEO Rod Equd has said that “there is no way in which the traditional Defence contracting model would have coped [with the project],” but the risk-sharing dimension didn’t make sense for Navantia. Their project share was supposed to be just A$ 300 million, and if the firms picked by Australia’s government didn’t perform, they weren’t about to pay penalties. DMO ended up signing separate contracts with the AWD Alliance and with Navantia, introducing a disconnect that ended up haunting the program.
SEA 4000: Contracts & Key Events
Unless otherwise specified, US Naval Sea Systems Command in Washington, DC manages the contracts, on behalf of their Foreign Military Sale client.
Program restructured, again, as delays & costs escalate; ANAO in-depth review; Brisbane’s keel laid.
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June 4/14: Restructuring. Australia’s new Liberal Party government announces another AWD program restructuring, “dealing with a range of unresolved structural and systemic issues that have remained unaddressed for too long.” The short form of their conclusions?:
“Now the main problems with the project as we have inherited it is that there were problems with the initial program plan, there were problems with inadequate government oversight, there were problems with the alliance structure which seemed incapable to manage issues if and as they arose and there were also problems with the performance and capabilities of ASC and major subcontractors.”
The overall project is 21 months behind, with Hobart delayed to 2016, and delivery of the 3rd ship shifted to March 2019. Defense minister Johnson reminds reporters that this is the program’s 3rd remediation cycle, and patience seems a bit thin. That’s understandable, given the program’s huge size and how alarmingly far along it is. In the wake of former US Secretary of the Navy Don Winter’s report (q.v. Nov 18/13), and an ANAO review (q.v. March 6/14), SEA 4000 is now on Australia’s “Projects of Concern” list. In addition:
“…the reform strategy that Professor Winter has recommended to the Government will seek to improve ship building productivity at the Air Warfare Destroyer Ship Builder ASC and its sub-contractors. It will include the urgent insertion of an experienced ship building management team into ASC [emphasis ours] and after we have been able to augment ship building capacity, we will seek to pursue the reallocation of blocks between ship yards to ensure that the program is sustainable and that productivity levels are maximised…. There are obviously some serious complexities involved in giving effect to the recommendations… which is why we will immediately engage relevant commercial and legal advisers to assist us through that process. We will have some further announcements to make in terms of the practical implementation of this reform strategy in July this year.”
Defense minister Johnson certainly sounds serious, and then he delivers a 2nd major shot across ASC’s bow. Submarines may be considered to be a top-tier strategic industrial capability, but:
“Now we’ve got potentially another 8 future frigates that we would like to build in Australia, but I am sending a very clear message out today. If we can’t fix this, that is something that will certainly be in jeopardy, because I don’t believe the Government will support an enterprise that cannot deliver productively.”
The next step is a lot of complex negotiations, especially given the legal issues around existing contracts. The government is saying that these negotiations are why they won’t release Winters’ full report now. Sources: Australia DoD, “Minister for Finance and Minister for Defence – Joint Media Release – Putting the Air Warfare Destroyer program back on track” | “Minister for Defence – Air Warfare Destroyer added to Projects of Concern list” | “Minister for Finance and Minister for Defence – Joint Press Conference – Review of the Air Warfare Destroyer program”.
March 6/14: ANAO Report. Australia’s ANAO releases a 302 page report that chronicles the AWD program and its issues, and makes recommendations. The key takeaway is that ANAO has almost no confidence in the A$ 302 overrun estimate provided by the AWD Alliance in November 2013, citing issues with process control and EVMS measurements of shipyard productivity – 1.0, as of September 2010, vs. 0.62 as of November 2013. Why?
“As at November 2013, the Alliance was experiencing a range of difficulties that have cost and schedule implications. Longstanding issues with the maturity of detailed design documentation were ongoing, resulting in significant rework, major construction problems had re-emerged at subcontractor level, and shipbuilding productivity remained well below expectations…. There has been an average of 2.75 revisions per drawing (as at March 2013), and revised drawings were still being provided in late 2013. This process has led to costly and out-of-sequence rework in cases where construction work already undertaken no longer matched the design…. detailed design immaturity and construction performance issues were ongoing in late 2013, and continue to pose a [serious] risk to the program’s cost and schedule.”
Forgacs’ ANAO audit reply adds that some remedial measures, like the November 2010 reallocation of ship blocks from BAE, just ended up breaking execution limits at their firm and spreading the problem. It’s important to remember that none of the Australian firms picked had built a major surface combatant in recent memory, and Forgacs warns of a possible repeat: “…the time line for the tender evaluation process of the next major Defence project to prevent a gap in work is dangerously close.” On which note, Australia’s DoD’s reply adds insight into SEA 4000′s issues, while providing a textbook example of a phenomenon known as The Planning Fallacy:
“Defence did consider these issues throughout Phases 1 and 2 of the AWD project and made sizeable investments in the shipbuilding industry in studying existing and evolved designs, and comparing these to contemporary projects of similar scale and scope in Australia and overseas. The estimated cost and schedule for the shipbuilding element exceeded all other contemporary examples…. on present estimates, the shipbuilding delay is anticipated to be at least 49 weeks (or 18 per cent) longer than the period required for the original F100 design and build….. Defence considers the amount of design change was not excessive for a design of the complexity of the AWD, nor was the level of design change unpredicted at Government approval.63 The real issue around these changes was in the immaturity of the processes to manage the design change challenge with the designer and the block subcontractors.”
Sources: ANAO, “Air Warfare Destroyer Program” | NineMSN, “Warship project heading for cost blowout”.
ANAO Audit Report
Nansen Class: S-5000?
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Feb 3/14: Keel-laying. ASC in Adelaide holds a ceremony for destroyer #2 Brisbane. There are a number of questions swirling around reports of large cost overruns, the inquiry the government announced last year, etc. The Minister’s response:
“The project overall won’t have an overrun until we have finished the project, if there is one. Now, things come and go with ships – with labour there is a whole lot of flexibility in the program, there is a lot of contingency. We won’t know the final figure until the last boat is in the water…. I can confirm that the contingency has not been spent already…. I am working on the inquiry as we stand here now, and there may be an announcement on that in the near future…. I don’t believe it is government policy for a 4th Air Warfare Destroyer at this time because we have a White Paper coming. Those issues are very important to inform the White Paper and there is a possibility that this hull can be used for the SEA 5000 [DID: future ASW frigate] programme but we are a long way from finalising that. So, let’s just not try and speculate too much before we put everything together in a White Paper…”
With respect to his statement that the base (F100 class) hull could be used as the basis for Australia’s SEA 5000 anti-submarine warfare frigates, it’s worth remembering that shipbuilding is a minority of a ship’s cost, with onboard equipment and weapons making up the majority. With that said, 7,000t is quite large for an anti-submarine frigate. Even with significant equipment cost reductions, Australia would be very hard pressed to build 8 ships. Navantia has a more likely option in the scaled-down Fridtjof Nansen Class AEGIS frigates it built for Norway. The 5,130t ships combine an anti-submarine focus with a smaller AN/SPY-1F radar, AEGIS combat system, and solid mid-range air defenses. Costs in 2000 were about $326 million per ship. Sources: Australia MoD “Minister for Defence – Transcript – Keel-laying ceremony for Air Warfare Destroyer (AWD) HMAS Brisbane, Techport Australia, Adelaide” and “Minister for Defence – Transcript – Doorstop at Keel-laying ceremony for Air Warfare Destroyer (AWD) HMAS Brisbane, Techport Australia, Adelaide”.
Brisbane keel laid; Same hull for SEA 5000?
2012 – 2013
Hobart’s keel laid; Australia to wait until 2017-2018 for next-gen EW systems; Labor Government stretches AWD project timeline to keep busy until submarine contracts begin – then dithers on its submarine choices; New Liberal government promises a program review after AWD is 17.2% over budget for the past year.
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Dec 17/13: ANAO Report. Australia’s National Audit Office releases their 2012-13 Major Projects Report. There’s a lot of coverage in the Australian press about overspends during the past year, including reports describing potential billion-dollar bailouts of the program. The overspend is real, but the ANAO says nothing about billion-dollar cost increases. Here’s how the actual numbers break out.
According to ANAO, the total program budget, including indexing for inflation and exchange rate factors, works out to A$ 7,869.2 million as of June 2013. That hasn’t moved much in real terms since the program began. ANAO does say that about 59.2% of the program’s budget has been spent as of June 2013, leaving about A$ 3.3 billion to go, with only 46-49% of the project complete. That isn’t unusual for long efforts like shipbuilding, which order a lot of equipment up front. Indeed, the Canberra Class LHD are in the same spend/completion boat. ANAO lists the AWD project’s maturity at about 75%, even as they warn “the 2012–13 MPR continues to highlight inconsistencies within [DMO's] application of Project Maturity, reducing the level of reliability of [their] maturity assessments.”
Financially, the SEA 4000 program went over budget by A$ 106.4 million in the past year (A$ 723 million instead of A$ 618.6 million, a 17.3% overrun), due to “Participants exceeding budget for labour, materials and subcontracts, as well as [DID: a miniscule] indexation shortfall.” Even if all remaining spending as of June 2013 faced a 17.3% hike, that adds up to about A$ 570 million extra – which would place the entire project just 6.7% over budget. For whatever it’s worth “DMO considers, as at the reporting date, there is sufficient budget remaining for the project to complete against the agreed scope.” ANAO does acknowledge that the budget for (American) Engineering and Technical Assistance probably isn’t sufficient, but that’s not generally a major cost driver. The one interesting technical note is that:
“Electronic Warfare Radar – Electronic Attack sub-system procurement has been deferred as current technology does not meet the contract and Royal Australian Navy (RAN) requirements. The budget has been preserved to support second generation technology being fielded in the AWD. It is expected that the capability will be available in the 2017-18 timeframe.”
If local efforts fail, there’s always the option of switching to the USN’s forthcoming SEWIP Block 2. Sources: ANAO, 2012-13 Major Projects Report | Australian Broadcasting Corp., “Air Warfare Destroyer project hit by budget blowouts of $10 million per month” | The Australian “Fears of $1bn bailout as destroyer project leaks $10m a month”.
Nov 18/13: Review coming. After the AWD Alliance reports that a full baseline review forecasts a A$ 302 million overspend beyond the approved budget, Australia’s government announces:
“Since coming into Government… detailed briefings from key stakeholders associated with the Air Warfare Destroyer program [show] ….part of the legacy of unresolved issues which we have inherited from Labor…. [The Ministry for Finance of Ministry for Defence] are committed to establishing an independent review into the Air Warfare Destroyer program. We will provide further details of this review when we finalise the terms of reference in early 2014.”
Source: Australia DoD, “Minister for Finance and Minister for Defence – Coalition committed to the efficient delivery of the Air Warfare Destroyer programme” | ANAO report No.22 2013–14.
July 11/13: Infrastructure. The Australian government announces that Baulderstone Pty Ltd. will be appointed to manage an A$ 170.2 million project to build new and refurbished LHD and Air Warfare Destroyer berthing and support facilities in Sydney. The firm has a long history managing large construction projects, including the iconic Sydney Opera House.
The award is split, with A$ 60.3 million allocated to the Canberra Class LHDs and $109.9 million for the Hobart Class Air Warfare Destroyers. Baulderstone will manage the build-out of berthing infrastructure, permanent maintenance, and systems support facilities for the new ships at Garden Island, and nearby training facilities at Randwick Barracks and HMAS Watson. Construction is expected to begin in late July 2013, with completion scheduled for late 2015. Australia DoD.
July 2/13: Hobart. The final keel block, which happens to be the 18th of 31 total ship blocks, of the Hobart was lifted into place in Adelaide. That block is used for flotation and stabilization. Work on the hull should be consolidated by early 2014. DoD | The Advertiser (with timelapse video}.
April 19/13: Weapons. Raytheon announces that they’ve delivered the 2nd Phalanx Block 1B CIWS system for last-ditch, close-in defense on board the future HMAS Brisbane. The first Phalanx 1B was delivered for Hobart in late 2012, and Sydney’s system will be delivered and installed in 2014.
April 2/13: Sub-contractors. MG Engineering loads Hobart’s 22m mast on a barge, and floats it up the Port River to Techport Australia. See also July 4/12 entry. Adelaide Now.
Jan 17-20/13: Industrial. BAE ships its 8th and 9th keel blocks to ASC, who accepts them. This completes all of BAE’s blocks for Hobart and Brisbane. Block 415 is a 117t hull block, while Block 111 is a 112t keel block.
BAE’s release emphasizes their focus on securing future work, which has been in jeopardy ever since the yard’s high-profile workmanship problems in 2010. Unsurprisingly, the rest of the release spends time discussing improved processes for work planning, welding quality, dimensional control, and inspection and acceptance. BAE Systems.
Oct 30/12: Torpedoes. Australia’s government announces that Hobart’s triple-tube Mk32 MOD 9 torpedo launchers successfully completed testing in June 2012, and Brisbane’s launchers successfully completed their own test with an MU90 torpedo mockup.
Sept 6/12: Delays. The Australian government announces a re-baselining of the AWD construction schedule. Nothing’s wrong, but the government’s delayed commitment to the future submarine program means that the AWD program will end before any submarine program begins. That would create a sudden loss of jobs and skilled workers, so after consultation with Australian industry, the time between each delivery is being extended to 18 months.
That’s certainly an easier schedule to meet, and offers more project leeway, but it also means that Australia’s ability to protect its naval forces will suffer. The opposition Liberal Party’s shadow defence minister, highlights this problem, even as Sen. Johnston dismisses the industrial rationale. The AWD delays, he says, are entirely driven by recent heavy cuts to the defense budget, and the delays are just a way to take money out of the project.
The re-baselined schedule changes the delivery dates to March 2016 for D39 Hobart, September 2017 for D41 Brisbane, and March 2019 for D42 Sydney. The program is currently valued at A$ 8 billion. Australian government | Liberal Party Opposition.
Sept 6/12: Keel-laying. The official keel-laying for AWD01 Hobart at Techport Australia in Adelaide moves the project into the Consolidation phase. BAE Systems has delivered all 7 of its Hobart blocks to AWD Shipbuilder ASC in Adelaide, and Forgacs is expected to deliver all 7 of its blocks before the end of 2012. Hobart’s hull is due for completion on the hardstand within 15 months, but delivery won’t take place until 2016. AWD Alliance.
Hobart keel laid
July 4/12: Sub-contractors. The Australian government awards an A$ 3.25 million contract to MG Engineering in Adelaide. Over the next 2 years, the firm will build 25 tonne, 22 meter long central masts for all 3 Air Warfare Destroyers.
The masts have to be built in 6 sections, joined together on a jig, then transported by barge to Techport. MG engineering will hire another 10 staff to do this work, raising their total to 40 people. AWD Alliance.
July 4/12: AEGIS. The first 2 radar faces for Hobart’s AN/SPY-1D (V) phased array radar arrive in Australia. Each SPY-1D radar has 3 “faces” to offer radar coverage all around the ship. Australian DoD.
Major reallocation of shipyard work arrangements away from BAE, to Forgacs; Australia picks MH-60R to serve on AWDs.
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Oct 18/11: Sub-contractors. The Australian government awards Hunter subsidiary Forgacs another 2 AWD blocks (1 each for Hobart and Brisbane), worth around $80 million. This brings their total to 40, up from 29 when the project started.
The work will create about 150 more jobs, and Forgacs will open another shipyard line at Carrington, which currently employs 50 people. Another 450 are working on the AWD at Tomago. Work has already begun on all 14 Hobart blocks, and 2/13 Brisbane blocks. The new hires will bring Forgacs to its envisioned maximum of 650 people working on AWD, across both shipyards. Australian DoD.
Aug 12-15/11: BAE Systems ships the first Air Warfare Destroyer (AWD) block to the ASC facility at Osborne in South Australia. This first block weighs around 180 tonnes, and is 18 x 16 x 5 meters. In light of past problems at the Williamstown shipyard, BAE Systems Director of Maritime, Harry Bradford, tried to reassure by saying that:
“We are now at a stage where we have the right people and the right skills to meet the challenges this project will bring. As an international shipbuilder BAE Systems also has the added advantage of global reachback and can draw on our experiences in other markets.”
Aug 6/11: Guns delivered. The AWD Alliance announces the arrival of 6 RAFAEL Typhoon Mark 25 Mod 2 guns, which will equip 3 Hobart Class destroyers at a cost of around A$ 15 million. These 25mm, stabilized guns are operated from within the ship using a joystick and screen, with imagery provided by the Typhoons advanced Toplite day/night optics. Each AWD will be equipped with 2 Typhoon guns, located on the Port and Starboard Bridge wings of each ship.
The guns will be stored in a secure Adelaide warehouse until they are installed on HMAS Hobart, Brisbane and Sydney during construction.
July 27/11: Guns delivered. The AWD Alliance has taken delivery of the Hobart Class’ 3 Mk.54 MOD 4 gun mounts, which include the 127/62 mm gun, turret, and associated below-decks systems for handling ammunition. The BAE Systems gun mounts were manufactured in the United States, per the Sept 17/08 contract, and are valued at A$ 80 million (conversion rose from USD $63.5 – $88 million in the interim). They will be placed into a controlled storage facility in Adelaide, until they are installed in their respective ships. Australian MoD.
June 16/11: MH-60R wins. Australia picks Sikorsky’s MH-60R naval helicopter over the NH90 NFH; it will equip the Hobart Class.
May 27-31/11: Shipbuilding issues. BAE Australia doesn’t react officially, but reports begin to surface in the Australian press that suggest problems with the AWD Alliance as the root cause, via poor quality drawings and incorrect specifications. The claim is that more than 2,400 faults have been discovered in the data, said to include wrong dimensions for the hull shapes, inconsistent assembly instructions, missing measurements, and faulty welding guides. It has reached the point that BAE has rejected the ASC’s design pack for Brisbane, the 2nd ship of class. The ASC has rejected BAE’s criticism, and refused to agree to BAE’s request for an improved design package.
There’s also controversy over reports that the Gillard government was warned of these problems in February 2011, and was very slow to act.
The Australian government eventually fires back. While they agree that there have been thousands of technical queries, and that lead shipbuilder ASC and BAE are in dispute over the designs, they note that the other 2 contractors, and Navantia haven’t had the same problems. DMO chief executive Dr Stephen Gumley tells an Australian Senate committee that experts will look into the drawings issue, but adds that BAE may have taken on more work than it had skilled personnel to handle, and did not inform the DMO about problems in a timely way. The state of AWD industrial team relations seems poor, at best. The Australian, re: drawings dispute, re: Government notice | Adelaide Now re: DMO testimony.
May 26/11: Shipbuilding issues. Australia’s government announces that they will change the allocation of work on the SEA 4000 AWD project. Even after reallocating 3 ship blocks away from the Melbourne BAE Systems shipyard to Forgacs in Newcastle (vid. April 1/11 entry), it remains stretched due to AWD and LHD commitments. As a result:
“The advice of the AWD Alliance is that if no action is taken to relieve the pressure on the Melbourne BAE Systems shipyard the first ship would be two years late, approximately 25 per cent over schedule… [our proposed changes] will reduce the delay of the completion of Ship 1 by up to 12 months, and of all three AWDs by up to 12 months.”
Note that this still means a year’s delay for Hobart. After consultation with Australia’s DoD, we are able to provide the following modified work summary for the 93 blocks involved in all 3 ships:
Navantia: 8 blocks… 3 sonar block assemblies, 5 reallocated blocks for Brisbane (expected cost: A$ 40 million)
ASC: 25 blocks… 9 Hobart, 8 for Brisbane & Sydney.
BAE: 7 blocks… 7 Hobart.
Forgacs: 38 blocks… 12 Hobart, 13 for Brisbane & Sydney.
BAE will complete the structural steel and initial outfitting work on the 7 Hobart blocks in its yard. Up to 13 BAE blocks (6 construction, 7 blast/ paint/ advanced outfitting) from Hobart & Brisbane to be reallocated “among the 3 Australian shipyards,” but this is likely to mean ASC & Forgacs in practice. A decision on BAE blocks for Sydney (implicitly: 2) will be made later in the AWD project.
BAE will, however, keep all 14 ship blocks for the 2 Canberra Class amphibious ships’ superstructure and integration work. Royal Australian Navy | Australia DoD | The Australian.
Major work reallocation
May 15/11: Infrastructure. ASC in Adelaide invites the public to its shipyard from 12noon -3:00pm, to tour progress on the construction of Hobart Class Air Warfare Destroyers (AWD). The event is jointly hosted with the AWD Alliance, and is the 1st time ASC’s shipyard has ever been open to the public.
This week also marked the start of blast and paint work at a new A$ 8 million facility at ASC’s Shipyard to paint steel blocks under construction. ASC.
April 27/11: AEGIS. Lockheed Martin Mission Systems & Sensors in Moorestown, NJ receives an $18.3 million not-to-exceed contract modification for command team trainer efforts to build the Aegis Weapon System baseline for Australia’s Hobart Class. The firm will provide necessary combat systems engineering, computer program development, ship integration and test, logistics technical services, technical manuals and staging support.
Work will be performed in Moorestown, NJ (89%); Clearwater, FL (9%); and Adelaide, Australia (2%). Work is expected to be complete by December 2014 (N00024-10-C-5125, FMS case AT-P-LCQ).
April 1/11: Shipbuilding issues. Lead yard ASC hands Forgacs in Newcastle, Australia a new A$ 40 million contract from ASC for another 3 hull blocks, as a result of problems with work at BAE systems (formerly Tenix) in Victoria, Australia.
The contracts comes on top of Forgacs’ original A$ 150 million contract, and the firm is set to employ an extra 70 workers, but they’re having trouble recruiting enough skilled tradespeople at the Tomago shipyard. They’ve already gone from about 15 people at Tomago to around 300, and adding the additional boilermakers, welders, riggers, dogmen and scaffolders is proving to be a challenge. Australia Broadcasting Corp.
Picks: EW/ESM, STACOM; Problems with BAE’s work; DSCA request: SM-2 air defense missiles.
Spain’s F101, 2005
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Dec 20/10: AWD Alliance. The Air Warfare Destroyer Alliance officially appoints acting CEO Mr. Rod Equid, BE (Electrical), M.Sc Engg (Aerosystems) as its new CEO. Before his step up to acting CEO in April 2010, he had been the alliance’s General Manager Business. His previous background includes 15 years as a RAAF engineer officer, 5 years as a senior Defence public servant, and nearly 14 years with Raytheon Australia.
“Mr Equid said hull construction is in the start-up phase on the way to peak production. Block production is currently underway in three shipyards, ASC in Adelaide, BAE Systems in Melbourne and Forgacs in Newcastle. “The combat system production is well advanced, combat system integration is on track and the AWD Alliance has signed contracts for nearly all major equipment and material,” Mr Equid said.”
Oct 27/10: Shipbuilding issues. The Australian reports that ASC has asked shipping experts from Lloyd’s Register Asia to visit BAE’s Williamstown shipyards, in order to “ensure the blocks are being built to internationally recognised standards.”
“ASC is believed to have asked Lloyd’s to become involved about four weeks ago when it became aware of the gravity of the keel bungle. The Lloyd’s advisers are likely to visit the shipyards once a week for at least the next six months to help oversee the construction. Spokespeople from ASC and Lloyd’s declined to comment yesterday.”
Oct 26/10: Keel Issues. Australian media report that Hobart’s 200t, 20m x 17m central keel block was built to inaccurate dimensions, as a result of faulty welding, and inadequate quality control at BAE Systems Australia’s (formerly Tenix) Williamstown shipyard. The AWD Alliance confirmed the problems, and said 2 other hull blocks were saved from distortion when the issue was identified and production processes were changed. The Australian reports that:
“One AWD source, who asked not to be named, said: “This is not a small problem – this is a major headache for us. This will have a ripple effect on the whole project because that hull block is critical, and if that block is delayed, then a raft of other things also get delayed.”
Beyond the obvious compatibility problems with other ship blocks, the keel block is arguably the most important part of the ship, supporting the heaviest machinery, and playing a large role in the ship’s long-term durability. AWD Alliance CEO Rod Equid said that he believes the problem has been fixed, without offering many details, and adds that the program has been 4 months ahead of schedule until recently. That buffer may help cushion the blow, but he would not commit to a revised timing figure. The Australian | Sydney Morning Herald | China’s Xinhua | The Age (incl. video) re: effects on other programs. See also The Australian’s update on current progress, “Destroyer program on full throttle .”
Shipbuilding problems at BAE
Oct 26/10: The US DSCA announces [PDF] Australia’s formal request to buy 17 Warhead Compatible Telemetry missiles used in missile tests, including AN/DKT-71 Telemeters and assembly kits, spare and repair parts, technical data and publications, personnel training and training equipment, and support. The estimated cost is $46 million. The prime contractors are Raytheon Missiles Systems Company in Tucson, AZ; and Raytheon Company in Camden, AR.
The proposed sale of SM-2 Block IIIB STANDARD missiles will be used for anti-air warfare test firings during Combat Systems Ship Qualification Trials for the Royal Australian Navy’s 3 new Hobart Class Air Warfare Destroyers, currently under construction. Australia, which has already integrated the SM-2 Block IIIA, will have no difficulty absorbing these missiles into its armed forces. Implementation of this proposed sale will not require the assignment of U.S. Government or contractor representatives to Australia.
Oct 8/10: We’re hiring! The AWD Alliance announces a national recruitment drive to fill up to 60 vacancies in skilled positions.
The current focus on hull fabrication is leading to a demand for more welders at all three shipyards, as well as sheet metal workers, stores and warehouse positions, schedulers, procurement specialists and business analysts, pipe fitters, and boilermakers. In total, the 3 shipyards will also employ about 200 apprentices.
The Combat System team is moving to the management and test phase, creating demand for production engineers, integrated logistics support (ILS), systems engineers, and operations managers.
Sept 17/10: AEGIS. Lockheed Martin Mission Systems & Sensors in Moorestown, NJ receives a $197.5 million cost-plus-fixed-fee, contract with performance incentives, for post-Critical Design Review (CDR) Aegis Combat Systems Engineering to finalize and implement the Aegis Weapon System baseline for the Government of Australia. This contract includes options which, if exercised, would bring the cumulative value of this contract to $211.4 million.
Naval Sea Systems Command contract N00024-09-C-5104 supported these efforts through Aegis Combat System Critical Design Review, but a new contract is needed for post-CDR efforts. Work will include the necessary combat systems engineering, computer program development, ship integration and test, logistics technical services, technical manuals and staging support.
The AWD AWS baseline will be derived from a technology refreshed variant of the U.S. Navy’s AWS Baseline 7, Phase I.
Work will be performed in Moorestown, NJ (86%), and Adelaide, Australia (14%), and is expected to be complete by December 2014. There’s only one Aegis supplier, so this contract was not competitively procured (N00024-10-C-5125 for FMS case AT-P-LCQ.
June 16/10: Block transport. The AWD Alliance signs a A$ 25 million contract with Toll North Pty Ltd. The firm will make 23 trips of a barge towed by a tug boat, in order to move 66 destroyer hull blocks by sea from BAE Systems in Newcastle (15 trips) and Forgacs in Melbourne (8 trips), to ASC in Adelaide. Each destroyer is composed of 31 hull blocks, which are assembled at the AWD Alliance’s Techport site in Adelaide.
Minister Combet adds that the SEA 4000 project is currently on track to deliver HMAS Hobart in December 2014. HMAS Brisbane is scheduled for delivery in March 2016, and HMAS Sydney in June 2017. Australia DoD.
May 20/10: SATCOM. Australia’s Labor Party Minister for Defence Materiel and Science, Greg Combet, announces that the Air Warfare Destroyer (AWD) Alliance has selected Thales Australia Ltd. as the preferred supplier for satellite communications (SATCOM) equipment for the Hobart Class destroyers.
The AWD system incorporates SATCOM equipment from leading suppliers including ViaSat, SITEP and Thrane & Thrane. Under the A$ 9 million contract, Thales Australia will design and build the equipment at its Garden Island facility in Sydney, before installing the equipment on the AWDs at Techport Australia in Adelaide. Australian DoD.
April 23/10: AWD Alliance. CEO John Gallacher retires as chief executive of ASC Shipbuilding and the Air Warfare Destroyer Alliance, returning to Western Australia after 5 years as the head of the company. Adelaide Now.
April 15/10: Update. Air Warfare Destroyer (AWD) Alliance CEO John Gallacher offers some updates, as the AWD Alliance holds a formal ceremony to launch the project’s construction phase:
“At ASC in Adelaide work is well advanced on two blocks including decking and superstructure components a total of 35 metres long and weighing a total of more than 200 tonnes.
At BAE Williamstown, Victoria work is underway on building the four main ‘keel’ blocks that, when consolidated at ASC, will be 69 metres long and weigh a total of 450 tonnes; and
At FORGACS Newcastle, New South Wales work is underway on three central blocks, including super structure, with a total length of 36 metres and weighing a total of more than 200 tonnes… At the three shipyards some 500 people are now working directly on building the blocks with the total workforce on the project of 1000.”
AWD Alliance | Adelaide Now
April 14/10: EW/ESM. The AWD Alliance announces ITT-EDO Reconnaissance Surveillance Systems (RSS) as the preferred supplier of the Hobart Class’ electronic warfare capability, which will detect and classifying radars, produce countermeasure transmissions, and intercept communication signals. The EW component will be integrated with the AEGIS combat system, and ITT/EDO is joined by Australia’s Jenkins Engineering Defence Systems and Avalon Systems.
The AWD Alliance will now enter into contract negotiations that are expected to be complete by mid-2010.
April 1/10: Radars. Northrop Grumman Systems, Inc. in Garden City, N.Y., is being awarded a $41.5 million modification to previously awarded contract (N00024-10-C-5343) for the delivery of AN/SPQ-9B radar sets and combat interface kits for use on U.S. Navy ships. Work will be performed in Melville, NY (91.2%); Norwalk, CT (5.5%); and Baltimore, MD (3.3%), and is expected to be complete by April 2011. The Naval Sea Systems Command in Washington, DC manages this contract.
A subsequent corporate release confirms that this purchase covers 6 radar shipsets, including the 3rd radar of a 3-system order for the Royal Australian Navy’s Hobart Class Air Warfare Destroyers; and 3 antenna groups. The follow-on order is part of a five-year $281.5 million contract awarded in October 2009. See also May 5/08, July 9/08, and Oct 30/09 entries in this FOCUS article, as well as the free-to-view article: “NGC Contracted for USN/RAN SPQ-9B Radars & Support”
March 10/10: Infrastructure. The AWD announces contracts worth more than A$ 4 million for the fit-out of the new Air Warfare Destroyer (AWD) Systems Centre at Techport Australia, Adelaide, South Australia. The new AWD headquarters will have a 5 Star Green Star rating from the Green Building Council of Australia, and will accommodate 300 staff including personnel from the Commonwealth, ASC, Raytheon Australia, Navantia, Bath Iron Works, Lockheed Martin and the US Navy. Move-in is expected later in 2010.
Member firm ASC signed a contract with the ISSI property services group, for infrastructure, equipment and services in the Systems Centre. This includes work stations; custom joinery; electrical, mechanical, hydraulic and fire protection services; graphics and interior design; equipment; and project management.
Member firm Raytheon Australia signed a contract with Synergy for work audio visual systems (including interactive whiteboards, LCD screens, projectors and audio systems), video confer