Reprinted with permission fl-om AMI HOT NEWS, an internet publication AMI International, PO Box 30, Bremerton, Washington, 98337.
From title March 2004 Issue
INDIA-Still Attempting to Lease Nuclear Submarine<.h4>
As of the end of March 2004, conflicting reports continue to emerge concerning the Indian Navy lease of one and possibly two Akula class submarines from Russia. India, which has been in negotiation with Russia since I 991, is attempting to lease one unit of the nuclear powered Akula class as a stop-gap measure until its own nuclear submarine program (Advanced Technology Vessel) comes to fruition in the next decade.
India leased a Charlie I class nuclear powered guided missile submarine (SSGN) from Russia from 1988 through 1991 in order to train a core of 150 personnel for nuclear submarine operations. However, with a 20-year gap from 1991 to the first commissioning of the ATV in 2011, the Indian Navy finds its experienced personnel beginning to retire. This gap is putting pressure on the Indian Navy to conclude a deal with Russia to get an Akula as soon as possible in order to recommence nuclear-submarine training.
Reporting from many sources indicate that up to two units will be leased from Russia while other sources indicate that Russia has no submarines to lease at all. The answer probably lies in the middle with one unit available for India to lease. Price will probably be the critical issue as both sides have been negotiating since 200 I, similar to the Gorshkov deal. What is known is that two Akula class submarines are under construction in Russia, the first being the submarine COUGAR, which is now complete and expected to be commissioned into the Russian Navy in 2005. The second unit is still under construction and is scheduled for completion by the end of 2005 and will probably be leased to India, arriving in Indian waters by the end of 2006 if the deal is complete.
When India completes the lease (by around 2015), the Russian Navy will probably take possession and operate the submarine as it attempts to rebuild its antiquated submarine force under the 2015 modernization plan.
RUSSIA-Navy Reentering the Submarine Business
On 19 March 2004, the keel for Russia’s newest Borey (Project 995) class nuclear powered ballistic missile submarine (SSBN) was laid down. The newest vessel will be named ALEXANDER NEVSKY, and is expected to be commissioned into the Russian Navy (Rosiyskiy Voennomorsky Flot-RVF) by 2008. The first unit of the class, YURJY DOLGORUKIY, was laid down in 1996, however, due to funding shortages and redesign work, the unit was only 47% complete by 2000.
Other than the Borey class, the only other active submarine program in Russia is the AKULA class nuclear powered attack submarine (SSN), of which the COUGAR is expected to commission in 2005 and a second unit is under construction and will probably be leased to the Indian Navy.
Although Russia’s nuclear submarine programs have been stalled for better than a decade, there appears to be a renewed emphasis on the strategic and tactical Submarine Forces of the sea services. Under the Naval Doctrine of 04 March 2000 and the Military Doctrine of 21 April 2000, the importance of submarine based strategic nuclear forces was emphasized as well as the renewal of the tactical Submarine Forces. Both programs were to be revitalized by 2015 and the recent start of the ALEXANDER NEVSKY as well as the completion of the COUGAR attests to the fact that Russia is again moving forward with its submarine programs following over a decade of decline.
INDONESIA-Naval Modernization Effort Progresses
In early March 2004, reports continue to surface concerning the continuation of the naval modernization effort by the Indonesian Navy (IN). Press reporting indicated that Indonesia intended to acquire up to four submarines from South Korea for around US $270M per unit.
When India completes the lease (by around 2015), the Russian Navy will probably take possession and operate the submarine as it attempts to rebuild its antiquated submarine force under the 2015 modernization plan.
RUSSIA-Navy Reentering the Submarine Business
On 19 March 2004, the keel for Russia’s newest Borey (Project 995) class nuclear powered ballistic missile submarine (SSBN) was laid down. The newest vessel will be named ALEXANDER NEVSKY, and is expected to be commissioned into the Russian Navy (Rosiyskiy Voennomorsky Flot-RVF) by 2008. The first unit of the class, YURJY DOLGORUKIY, was laid down in 1996, however, due to funding shortages and redesign work, the unit was only 47% complete by 2000.
Other than the Borey class, the only other active submarine program in Russia is the AKULA class nuclear powered attack submarine (SSN), of which the COUGAR is expected to commission in 2005 and a second unit is under construction and will probably be leased to the Indian Navy.
Although Russia’s nuclear submarine programs have been stalled for better than a decade, there appears to be a renewed emphasis on the strategic and tactical Submarine Forces of the sea services. Under the Naval Doctrine of 04 March 2000 and the Military Doctrine of 21 April 2000, the importance of submarine based strategic nuclear forces was emphasized as well as the renewal of the tactical Submarine Forces. Both programs were to be revitalized by 2015 and the recent start of the ALEXANDER NEVSKY as well as the completion of the COUGAR attests to the fact that Russia is again moving forward with its submarine programs following over a decade of decline.
INDONESIA-Naval Modernization Effort Progresses
In early March 2004, reports continue to surface concerning the continuation of the naval modernization effort by the Indonesian Navy (IN). Press reporting indicated that Indonesia intended to acquire up to four submarines from South Korea for around US $270M per unit.
Press releases subsequent to October 2003 suggested only two submarines would be procured although the IN had a requirement for up to six units.
Since the IN already operates two Type 209/1300 submarines, it is logical that the sea service would continue with the Type 209 series, and Daewoo Shipbuilding and Marine Engineering (DSME) already has experience in the construction of the Type 209/1200 (Chang Bo Go class). DSME constructed nine Type 209 submarines from 1989 through 2001 for the South Korean Navy, however, lost the follow-on Type 214 contract to Hyundai Heavy Industries. Since 2001, the only submarine related work for DSME has been maintenance for the Chang Bo Go class and now the first overhaul of the IN Cakra class. If the IN accepts the attractive offer of US $270M per unit, it appears that DSME will finally get its export market for submarines and the IN will get new submarines at considerably lower prices that if it had utilized European sources like the original Cakra class in the 1970s. It was originally thought that the IN would procure used South Korean Chang Bo Go class submarines as an incentive to buy additional used vessels, however, it appears that the IN desires four new units instead.
From the April 2004 Issue:
UNITED KINGDOM-Further Downsizing Leads to Future Cutbacks
On 01 April 2004, the United Kingdom announced that at least two of the three British aircraft carriers (ILLUSTRIOUS and INVINCIBLE) will be withdrawn from operational service with the third unit (ARK ROY AL) remaining in service. This announcement was in reaction to the Finance Ministry looking for ways to cut costs of 1 B Pounds (US$ I . 7B) to address cash problems caused by a new accounting system and the Iraq War.
This is not much of a change from the present set up for the RN carrier force. One unit is typically on a two-day alert for operations, the second is generally on a 60·day standby with the third in deep refit or reserve meaning the changes for the carrier force must be considered minimal.
This decision, however, in conjunction with Ministry decision in late 2003 (following the Defense White-paperof2003) to reduce the RN’s surface combatant force from 32 to 27 units has lead to much speculation concerning overall force levels for the sea service. A final decision on any future cutbacks is not expected until July 2004.
Some of the proposals from both decisions are expected to offset costs of Iraqi operations as well as attempting to fund future naval procurement such as the new aircraft carriers under the CVF Program. Proposals to date include:
- Reduction of surface combatant force from 32 to around 27 units. The final number is not considered solid as the number continues to fluctuate and could very well be 28 or even 26. What is becoming more certain is that three Type 42 Batch I frigates will decommission, however, the decision on the two or possibly three Type 23s is not certain and will probably not be known until July. If the Type 23s are in fact decommissioned, these vessels could very well be resold to Chile as has been discussed several times. As for the Type 42 Batch I frigates, candidates may include: Bulgaria, Thailand, Brazil, Ecuador or even Portugal.
- Discussions that the Submarine Force would be reduced from 12 units to 10 have also taken place. A reduction in force could have an impact on the Maritime Underwater Future Capability (MUFC) program possibly slowing the program
- Decommissioning of two aircraft carriers (ILLUSTRIOUS and INVINCIBLE). As discussed above, the RN carrier force currently is maintained in a status fairly close to the one discussed by the Finance Ministry. The impact is minimal for the short term. However, in the long term, all three carriers will become available for resale following delivery of the two new carriers under the CVF Program.
- Decommissioning of three Sandown class MCMVs has been discussed. At least one unit is already laid up and unserviceable meaning the decommissioning of two additional units will have a minimal impact on 22-unit mine-hunting force.
- Reduction of the Type 45 Destroyer purchase from 12 units to between a maximum of 10 to a minimum of 7. Like the other programs mentioned above, this issue will not be decided until July. A reduction to seven units will have a serious impact on the future of the RNs surface fleet.
Needless to say, the cutbacks as envisioned under the Defense White-paper of 2003 and recent announcements by the Finance Ministry could end up having a major impact on the RN if fully enacted in July. Long range planning suggests that the RN will begin to face considerable shortages in its surface and submarine fleets by the next decade if the trend is not reversed. Like many European fleets today, the RN will \probably find itself scaling back on its commitments worldwide and in the time of crisis not able to respond with the flexibility that it was once able to.
Additionally, the United Kingdom like most of Europe will also find itself not able to fully support its shipbuilding industry. Large shipbuilders such as BAE Systems and the VT Group will find themselves struggling to maintain their respective infrastructures and labor forces as the numbers of new vessels continue to spiral downward.
PORTUGAL-Inks Deal for Two Type 209 AIP Submarines
After six years of debates, evaluations and negotiations, the Portuguese Navy (PN) signed a construction contract with the German Submarine Consortium (GSC) for Type 209 submarines on 21 April 2004 with an option for a third. The contract for the two U209PN submarines is worth €770M (US$911 M) and includes € 1.2B (US$1.42B) in offsets for Portuguese industry. Specific offset arrangements include the provisions for the LPD design to meet the PN’s specifications, of which the GSC is teamed with Scheide Naval Shipbuilding.
The U209PN is tailored for the PN and includes Air Independent Propulsion (AIP) and other features of the later U214 design. Both submarines are scheduled for commissioning in 2009 and 2010. The ship length will be approximately 65m and displace 1700t sub-merged.
It must be noted that much criticism by the North Atlantic Treaty Organization (NA TO) followed the contract signing. NA TO believes that Portugal has no need for a Submarine Force. However the Portuguese position is that Portugal, although part of NATO, still has its own goals to achieve.
GREECE-First Type 214 Launched
On 22 April 2004, the first Greek Katsonis (Type 214) class submarine was launched from the Howaldtswerke-Oeutsche Werft (HOW) shipyard in Kiel Germany. As the first fuel cell submarine for export, the PAPANIKOLIS will undergo sea trials prior to its commissioning in late 2005. The PAPANIKOLIS is the first of four Type 214s that will be procured by the Greek Navy. The first four units of the class are under contract, with the first unit built in Germany and the follow on three units to be build at HOW’s subsidiary, Hellenic Shipyard in Greece. All four units are scheduled to commission by 2009.
A second batch of four units could be ordered by 2008 if the Greek Navy decides to maintain an eight-unit Submarine Force. The current Submarine Force consists of eight Glavkos class submarines that were commissioned from 1971 through 1980.
From the Mav 2004 Issue
GERMANY-Step Towards Consolidation
European Naval Industrial Consolidation
ThyssenKrupp Werften and One Equity Partners (OEP) signed a letter of intent to allow ThyssenKrupp to purchase Howaldtswerke Oeutsche-Werft (HOW). ThyssenKrupp Werften would create a new shipbuilding group by combining HOW and its assets (Keil, Kockums AB in Sweden, and Hellenic Shipyards in Greece) together with their current shipyard group of Blohm + Voss Gmbh, Blohm+Voss Repair GmbH, and Emden. This new shipbuilding group would represent some 9,300 employees in three countries with over €2.2B in annual revenues.
The agreement is for ThyssenKrupp to purchase all of OEPs shares in HOW by providing OEP €240M in cash together with 25% of the shares of the new shipbuilding group. A spokesperson at ThyssenKrupp said this represents a first step toward greater consolidation of European naval shipbuilding.
It’s great to see Germany regain controlling interest in their indigenous shipbuilding industry. However, more interesting is Thyssen’s belief this is afirst step! Let’s face it, with the continuous decline of naval ship new construction orders since the early 1980s, further consolidation is not just needed it is mandatory. Given the political and economic constraints of the European Union, a complete consolidation of EU naval shipbuilding is the end game sometime in the next 15 years.
With South Korea, China, and others owning the commercial shipbuilding for the foreseeable future, naval shipbuilding is where European shipbuilders will make their profits, which will become a more mandatory requirement for their survival. Now, given the complexity of today’s naval warships the naval industry must embrace the fact that electronics, sensors, weapons, and systems integrators represent over half the cost of a naval warship. In fact, when we look at the typical European shipbuilder’s value added contribution to a naval warship construction contract, it is approximately 8 to 12%. The command and control systems and weapons systems providers are the real significant valued added contributors with nearly 50%.
Right now, ThyssenKrupp will be seeking to consolidate its staff functions in reducing the operating costs of the new conglomerate. The facilities and the shipyard workers should not see much change. Where will the headquarters reside, Hamburg?
But when ThyssenKrupp is ready to look at step two or three in consolidation, AMI expects it will look towards systems houses such as Thales, SAAB, or AMS. Thales appears the likely candidate for this consolidation in that their strategy seems focused on being a naval warship prime. While they established ARMARIS to perform this function, there seems to be a lack of progress by ARMARIS in this endeavor. Since SAAB purchased Celsius and Kockums Shipbuilding was sold to HOW, SAAB has still to decide on the breadth and commitment to its naval focus. Alenia Marconis Systems appears to off er the best consolidation partner with ThyssenKrupp.
From the June 2004 Issue
DENMARK-Danish Navy Stepping out of the Submarine Business
In June 2004, Denmark’s Ministry of Defense released the Danish Defence Agreement 2005-2009. The new goals of Danish Defence include:
- Counter direct and indirect threats to the security of Denmark and allied countries.
- Maintain Danish sovereignty and protection of Danish citizens.
- Work towards international peace and security in accordance with the principles of the UN charter.
The white paper also emphasized that changes in the international security environment require that Danish Defense strengthen its capacities in two areas:
- Internationally deployable military capacities.
- Ability to counter terror acts and their consequences.
Denmark, like several other NA TO nations are beginning to pick and choose what capabilities that they feel can be done away with. For the Danish, it appears that they believe there is an insufficient threat to maintain a Submarine Force and that under NATO; other member nations will retain the capability allowing them to depart the business.
Http://www.amiinter.com/wnpr/denmark/index.html
