Fast-track plea for nuclear subs may sink in shipbuilding morass­

Fast-tracking Australia’s nuclear submarine plan by obtaining new or used boats from the US would require President Joe Biden to sacrifice scarce shipbuilding ­capacity.

The Virginia-class USS North Dakota. Picture: Reuters

Fast-tracking Australia’s nuclear submarine plan by obtaining new or used boats from the US would require President Joe Biden to sacrifice scarce shipbuilding ­capacity as he pushes to expand the US naval fleet.

While Scott Morrison says the AUKUS nuclear submarines will be built in Adelaide, there are growing calls for at least the first few boats to be built in the US so they can enter service sooner.

Multiple reports for congress, however, say the Biden administration’s blueprint to ramp up naval shipbuilding will test the limits of the US industrial base.

The 30-year US shipbuilding plan calls for a navy with 321 to 372 manned ships – up from the current 296 – including 66-72 ­nuclear-powered attack sub­marines and 12 ballistic missile boats.

A report by the US Congressional Research Service in September warned of “concern about the industrial base’s cap­acity for executing such a workload without encountering bottlenecks or other production problems”.

The prospect of Australia leasing older Los Angeles-class submarines would also require the US to allocate scarce maintenance resources to refuel and refurbish the boats.

Another CRS report, published on the day of the AUKUS announcement, said: “Shipyard capacity for conducting maintenance and overhaul work on an expanded fleet is another concern, particularly given the delays and other difficulties the navy has experienced in recent years in executing overhaul and repair work on today’s fleet.”

The paper cited 2017 testimony by John Casey, a senior executive of nuclear submarine builder General Dynamics Corporation, who said scaling up naval shipbuilding would be “most challenging for the nuclear submarine enterprise”.

“The entire submarine industrial base at all levels of the supply chain will likely need to recapitalise some portion of its facilities, workforce and supply chain just to support the current plan to build the Columbia-class SSBN program, while concurrently building Virginia-class SSNs.

“Additional SSN procurement will require industry to expand its plans and associated investment beyond the level today.”

Australian Strategic Policy Institute analyst Marcus Hellyer said the US would be unlikely to dedicate production capacity to Australia until well into the 2030s “without fundamental additional investment in shipyard infrastructure and workforce development … As it stands, their shipyard capacity is inadequate to meet their own needs.

“To do it quickly would mean they would have to give up their own production slots – whether slots for new Virginia-class boats, or slots to refuel Los Angeles-class boats,” Dr Hellyer said.

“It seems unlikely that they would do that since we will be on our training wheels for well over a decade. It would mean a net loss of capability for the alliance.”

Unlike the French, who are still fuming over the government’s surprise move to tear up its 12-submarine contract with Naval Group, the US has no experience in establishing submarine production lines in foreign countries.

According to the CRS reports, the latest Virginia-class boats cost $US3.45bn each (about $4.75bn) on the already established US production lines with more than 4000 approved suppliers.

Australia would be starting from scratch, without a purpose-built shipyard or single qualified local supplier.

British reports also drive home the scale of the challenge Australia faces in delivering on the Morrison government’s nuclear submarine ambitions.

The British National Audit Office revealed in 2018 that the UK’s national submarine enterprise consumed 25 per cent of the country’s defence equipment budget, saying the scale of expenditure “could destabilise the department’s overall equipment plan”.

The British NAO also revealed in a 2019 report the country had spent $930m maintaining its 20 retired nuclear submarines, none of which has been disposed of.

The Morrison government has announced an 18-month process to determine whether Australia will obtain US or British nuclear submarines, or a hybrid design, and how the boats can be delivered by a nation without a domestic nuclear industry.