Geelong loses defence deal after major review
The second phase of Geelong’s multi-billion dollar howitzer program will be scrapped, after the government’s landmark defence review found the weapons would not provide enough range or lethality.
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The second phase of Geelong’s multi-billion dollar howitzer program will be scrapped, after the government’s landmark defence review found the weapons would not provide enough range or lethality.
The announcement, made by Prime Minister Anthony Albanese and Defence Minister Richard Marles on Monday, will be a blow to Hanwha Defense Australia which is building a $170m Avalon airport facility where the howitzers will be produced.
Phase one of the project – to build 30 self-propelled howitzers – is in train and will not be affected.
Hanwha, a Korean defence giant, is also one of two companies short-listed to manufacture infantry fighting vehicles.
That contract was expected to be worth about $27bn with up to 450 infantry fighting vehicles to be manufactured, but under the review the order is expected to be slashed to just 129 vehicles.
The landmark Defence Strategic Review conducted by former chief of defence Sir Angus Houston and former Labor defence Minister Stephen Smith is being touted as the most significant update to Australia’s posture in 35 years.
In a stark assessment of international stability, the pair say Australia cannot rely on “geography or warning time” to help it as it faces the “prospect of major conflict in the region that directly threatens our national interest”.
They say Australia’s alliance with the United States will remain central to Australia’s security and strategy, calling ond efence to pursue greater technology collaboration and invest in partners in the Indo-Pacific.
“While there is only a remote possibility of any power contemplating invasion of our continent, the threat of the use of military force or coercion against Australia does not require invasion,” they said.
In 2019 then-Prime Minister Scott Morrison revived the decade-old dumped howitzer project, touting it as a major shot in the arm for Geelong manufacturing
A year later the Coalition backed its commitment to the project, by doubling the number of self-propelled howitzers to be manufactured in Geelong from 30 to 60.
In 2020 the Labor Party slammed the Coalition for concocting the billion-dollar election promise “on the run”, even labelling their jobs pledge a “patent lie”.
Mr Marles has also been critical of the project, once calling it a marketing tool.
On Tuesday, Liberal Senator Sarah Henderson said the government had “broken Geelong’s heart by cutting $1bn from the howitzer defence project”.
“Announced with no consultation or consideration of the profound uncertainty this creates for defence industry and our sovereign manufacturing capability, this is a very dark day for Geelong and regional Victoria,” she said.
Mr Marles said the review, and the government’s response, was about maintaining peace, security and prosperity in the region.
“There are a lot of tough decisions that need to be made, but in doing so, we are making them in the best interest of our Defence Force and our nation,” Mr Marles said.
“Work to implement the review starts today, ensuring out ADF and our defence personnel has the capability they need to keep Australians safe.”
Hanwha did not respond to questions for comment by deadline.
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