Developing homegrown weapons frustrated by abundance of choice
Defence self-reliance is critical to reducing our strategic vulnerability in terms of war, but where should we begin?
Covid has taught the world many lessons, including that global supply chains risk collapsing during a crisis. This has not been lost on Australian defence planners, who are racing to future-proof the country against an even worse crisis, such as the outbreak of a major regional conflict. One critical element of this is to boost the local production of guided weapons, which to date are all imported – mainly from the US. Without these, the ADF would be almost completely helpless in a future war.
The strategic justification for striving for a far higher level of defence self-reliance remains the rise of China, with senior figures from Scott Morrison down speaking in apocalyptic terms about the present era resembling the 1930s.
China and Russia have replaced Nazi Germany and a militarised Japan in displaying higher levels of aggression combined with a huge build-up of military hardware. In a major address to the National Press Club on November 26, Defence Minister Peter Dutton said: “Today, we face the most significant change in our strategic environment since the Second World War. Once again, Australia finds herself in a region at the very epicentre of global strategic competition. A region witness to a military build-up of a scale and ambition that, historically, has rarely been associated with peaceful outcomes.”
To reduce this major strategic vulnerability, the Prime Minister announced on March 31, 2021, that $1bn in Defence funding would be brought forward to develop an Australian Guided Weapons and Explosive Ordnance Enterprise. The history of modern warfare shows that stockpiles of weapons are quickly used up. In the air campaign against Libya, both the British and French forces engaged exhausted their supplies of air-to-ground missiles in weeks and had to be helped out by the US.
In the Falklands War of 1982, the Royal Navy used up almost all of its lightweight torpedoes trying to attack a single, old Argentinian conventional submarine known to be in the area. The numbers are classified, but it is believed that hundreds of torpedoes were fired against numerous false contacts in a futile attempt to destroy a single elusive target.
The Australian experience is no different and if we were involved in a major conflict it is possible that our stockpiles of guided munitions would be used up in a short space of time.
During the intense initial three years of Operation Okra in Iraq starting in 2014, the RAAF used hundreds of laser-guided bombs against ISIS targets but was able to be continually topped up with weapons from the massive US supply chain – a luxury that can no longer be counted on.
This is the first time … the US has agreed to offshore production of
one of its most advanced weapons
With this in mind, the search for a strategic industry partner to manufacture Australian guided weapons was fast tracked, with companies given only four weeks to complete a detailed registration of interest. That closed on August 4 and, as the matter was considered urgent, the government indicated the announcement of the winner would occur in November. That month came and went without a decision, possibly because the task is proving more difficult than anticipated. This could be because a large number of companies have a great deal to offer and deciding which ones to exclude is a major bureaucratic and political problem.
For starters, the Australian subsidiaries of several large US defence contractors have expressed interest, as have well credentialed suppliers from the UK, Europe, Scandinavia and Israel. To this mix can be added several 100 per cent Australian-owned entities such as Queensland-based NIOA – which has formed an impressive industry team under the umbrella of the Australian Missile Corporation. Other local companies such as EOS, Nova, Quickstep and Varley also have strong claims to guided weapons expertise.
The huge US guided weapons manufacturer Raytheon has made no secret of its enthusiasm for the role of strategic partner – and in August 2021 the State Department notified Congress of a possible sale to Australia of equipment and know-how to locally produce SM-2 and SM-6 missiles. These long-range naval weapons are manufactured by Raytheon and form the backbone of the RAN’s surface combat capability. This is the first time that anyone can think of when the US has agreed to the offshore production of one of its most advanced weapons.
Raytheon also manufacture Mk 54 lightweight anti-submarine torpedoes, which are used by both the RAN and RAAF as well as the US and a number of other nations.
The next iteration of the Mk 54 could take place with Australian involvement modelled on a 2009 agreement with Washington for the co-development of heavyweight torpedos.
Some companies are adopting a “neither confirm nor deny” approach to bidding, but another US company that has given an emphatic yes to the potential strategic partner role is Lockheed Martin, which is the world’s largest defence contractor. It not only supplies the F-35 to the RAAF, but the Aegis combat system to the RAN – and together with Thales will locally build next generation Long Range Anti-Ship Missiles.
It is also one of two companies short-listed to provide Australia with a Joint Air Battle Management System that will include medium-range missiles.
There is also an abundance of talent already in Australia. The local subsidiary of BAE Systems has been producing and exporting the Nulka hovering rocket decoy for decades, and the main motor has been supplied by Aerojet. BAE has also developed the Passive Radio Sensors for the Kongsberg Joint Strike Missile and is investing in a local hypersonic capability.
Many of the companies involved in the F-35 supply chain are producing components at the cutting edge of military technology that could also form part of the guided weapon enterprise.
There are at least a dozen companies that have sufficient credentials to tick the box as a possible strategic partner. However, there is the further complication of deciding whether entities that are ultimately foreign owned meet the definition of being sufficiently Australian to qualify. This issue is not new with a lively debate in defence circles for decades about whether companies need to be 100 per cent Australian owned to be considered truly local.
People arguing in favour of this latter approach say that the federal government can only completely trust Australian-owned companies to do the right thing in terms of developing and exploiting intellectual property – which is the essential ingredient for sovereign capability. On the other hand, many overseas companies have operated domestically for decades. All of their employees are locals, they pay taxes, profits are retained in the country and their boards are comprised entirely of Australian citizens.
If the government is paralysed because of this abundance of choice, it might need to select several strategic partners – but even this means that some companies will miss out. In the lead-up to a federal election, that might be causing some headaches.