Page 60 - Australian Defence Magazine Aug 2019

DEFENCE BUSINESS
VIEW FROM CANBERRA
Will military vehicles have
their own Valley of Death in Australia?
Managing peaks and troughs
THAT was the period of years between the wind down of construction of the three Air Warfare Destroyers (AWDs) and the start of new ship building projects for Hunter- class frigates, Offshore Patrol Vessels and Attack-class submarines.
In that period, ASC Shipbuilding had no choice but to lay off a significant number of skilled workers. That this was coming was well known to anyone with any knowledge of current and upcoming shipbuilding proj- ects and access to a calendar.
Shipbuilding projects are now under way and the continuous build program for new frigates would seem to offer assurance it won’t happen again any time soon in this sector.
But how about the emerging armoured vehicle sector?
This may never become an issue but Aus- tralia could actually end up with four dis- tinct factories, each producing one particu- lar type of vehicle and each beholden to the ADF for business, plus whatever sales can be picked up overseas.
This could end up less a Valley of Death – where there’s some prospect of even- tual recovery – and more a Bottomless Pit of Death, where once current orders are filled, businesses have to either export into a crowded global market or endlessly gouge Defence (and the Aussie taxpayer) to buy more vehicles which may not be needed.
First off there’s the established Thales fa- cility at Bendigo, Victoria, where Bushmas- ter and Hawkei vehicles are produced.
Bushmaster has been a big success and has achieved some exports but the Army, with more than 1,000 in inventory, would appear to have as many as it needs. Produc-
tion of 1,100 Hawkei vehicles is under way. Rheinmetall Australia plans to produce the Boxer Combat Reconnaissance Vehicle (CRV) facility at a new greenfield site at Redbank, a suburb of Ipswich in southern
Queensland.
Then there’s Land 400 Phase 3, to replace
the Army’s elderly fleet of M-113 armoured personnel carriers with up to 450 modern infantry fighting vehicles (IFVs).
Right now Defence is considering which of four contenders – Hanwha, Rhein- metall, GDLS and BAE Systems – will go onto a shortlist of two for detailed assess- ment for a Risk Mitigation Activity that was seen in Phase 2.
The winner will be announced in 2022, with initial operating capability achieved in 2024-25 and final operating capability in 2030.
Should Rheinmetall win, their Lynx vehicles would be built at Redbank, Qld alongside the Boxers. But each of the other contenders has their own ideas for production in Australia.
One possibility would be to co-locate pro- duction with Rheinmetall, creating one large plant rather than a pair of smaller plants.
South Korean firm Hanwha Defense Australia isn’t at all keen on that idea as it has its own plans to set up in Geelong, Victoria, drawing on the supplier and
workforce base from the now defunct car industry and compliment work for self pro- pelled howitzers, based on the K-9, already announced during the election.
Labor canned that project in 2012 for Budget reasons following a contest between K-9 and the German PzH 2000 from which K-9 emerged as the better solution. There was a strong sense that the Koreans had been treated pretty shabbily.
Then, to the surprise of just about every- one, Prime Minister Scott Morrison stood up during the election campaign to an- nounce that the Army would get its SP guns.
“We will utilise the outcomes of the tender process cancelled by Labor and the Coalition’s Smart Buyer framework, as the starting point of an accelerated approval process,” he said. “This will ensure that an Australian prime contractor can deliver a world-class platform with work beginning in Geelong before the end of 2022-23.”
That seems pretty clear – 30 Hanwha K-9 guns and 15 K-10 supply vehicles will be built in Geelong. So will Hanwha's Red- back IFVs if Hanwha wins Land 400 Phase 3. The South Koreans see production of armoured vehicles in Australia as a busi- ness venture but also a strategic backstop to their own defence industry, which would likely be obliterated in the first hours of all out conflict with the north.
A SPECIAL CORRESPONDENT | CANBERRA
Readers will be well aware of the Valley of Death, from which the shipbuilding industry is just now emerging.
60 | August 2019 | www.australiandefence.com.au
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