In 2024, the success of Naval Group's submarines could exorcise Australian trauma once and for all

It was feared that the trauma, and the damage to its image, would have seriously handicapped Naval Group for many years, after the surprise cancellation of the Australian contract by Melbourne in September 2021. The mixed success of the realization of export contracts, in 2022 and 2023, by the French industrialist, could give credence to these concerns. The year 2024, however, has started off fantastically well for the French specialist in military shipbuilding.

Not only has it started construction of the French Navy's new next-generation nuclear aircraft carrier, but its order book is particularly full, with the eight French and Greek Defense and Intervention Frigates, the six large mine warfare vessels, and the seven offshore patrol vessels.

However, it is in the field of submarine construction that the French industrialist particularly shone at the start of the year. The Cherbourg site, which assembles submarines in France, must in fact deliver the last 4 SSN of the Suffren class by 2031, to the French Navy, before beginning the replacement of the 4 Triomphant class SSBN, by the new 3G SSBNs.

Above all, after obtaining from Jakarta the signing of an order for two Scorpene Evolved submarines equipped with Lithium-ion batteries, Naval Group won the Dutch competition, a few weeks later, for four Blacksword Barracuda submarines. .

CThis situation, already enviable, could well improve further in the months and years to come. Indeed, French is involved in numerous export competitions or negotiations, sometimes exclusively, likely to materialize in the weeks or months to come. In doing so, Naval group could definitively exorcise the last stigmata of the Australian episode, to enter a period of historic commercial success.

Shortly after the signing, on March 28, of the order for the two Scorpene Evolved submarines, for the Indonesian Navy, Naval group quickly began preparing the construction of the two vessels, which will be carried out at PT PAL's Surabaya City site. .

Only 8 years to build locally and deliver the two Indonesian submarines

It must be said that, contractually, the French industrialist and its Indonesian partner have undertaken to deliver the two ships to the Indonesian Navy within eight years, after the contract comes into force.

Nagapasa class
The Indonesian Navy has been very critical of the Nagapasa class developed with the help of South Korea.

However, to begin these constructions, they will first have to adapt their industrial tools, while deploying and organizing a network of local subcontractors. This approach turns out to be particularly complex, especially when it involves giving the end customer, the Indonesian Navy, the same guarantees of efficiency and good functioning concerning the ships, and their maintainability, as if they had been assembled in Cherbourg.

Fortunately, Naval Group is not its first attempt in this area. On the contrary, over the last ten years, the industrialist has gained a reputation for great efficiency when it comes to technology transfer and local construction. First in India, to the point of being awarded the title of best EOM industrialist by the Indian Ministry of Defense a few years ago. And, later, in Brazil.

It is therefore not surprising that Naval Group and PT PAL, its partner, have already started these two strategic projects, with the order of a 6000 ton lifting gantry, and the first stages of recruitment, contracting and training of subcontractors.

If the contract worth nearly €2 billion constitutes a major motivation for the two manufacturers, the possibility of transforming the duo of submarines into a volleyball team is also in their sights.

The Indian naval industry in the running to support PT PAL in the construction of Indonesian Scorpene

India observes with great attention to the evolution of this Franco-Indonesian contract. Without being allies, the two countries have always followed similar political trajectories, having notably been the pillars of the non-aligned in the 50s, under the leadership of Soekarno and Jawaharlal Nehru.

Klavari class
Naval Group has been designated as the best industrial OEM by the Indian Ministry of Defense, regarding the P75 program

Since then, New Delhi and Jakarta have often followed parallel paths in terms of army equipment, especially by balancing their acquisitions between the Soviet and Western bloc, during the Cold War.

The Indonesian Scorpene submarine program is being closely monitored by New Delhi, and especially by the Mazagon shipyards. Pending the formalization of the order for 3 additional Scorpene, announced by Narendra Modi during his official visit to France in July 2023, but postponed after the Indian legislative elections, and in the absence of progress concerning the P75i program , the industrialist is effectively facing a lack of activity, likely to threaten its industrial assets and its entire network of subcontractors, which has been hard-established with Naval group.

The participation of Indians in the Indonesian program could also represent an opportunity for Naval group. Indeed, for the moment, Franco-Indian discussions only concern the local construction of 3 additional Kalvari class Scorpene, possibly equipped during construction with the AIP device developed by Indian industry.

Thus, the participation of Indian industry would allow Naval group to promote, indirectly, the Scorpene Evolved version and its lithium-ion batteries, which represent an efficient alternative to the 3 Scorpene Kalvari class, as well as to the six submarines of the program P75i to come, whose AIP propulsion turns out to be less noticeably less efficient than that of the Scorpene Evolved.

Promising, but complex, discussions and competitions for Naval Group submarines

The preparatory work surrounding the start of construction of the two Scorpene Evolved submarines intended for the Indonesian Navy represents, moreover, an excellent opportunity to draw an instantaneous image of all the programs in progress, to come or under negotiation , concerning Naval Group submarines, on the international scene.

SSN-AUKUS program
The cancellation of the Australian Attak-class submarine program was a real trauma for Naval Group and its teams.

After the trauma of the unilateral cancellation of the Australian contract by Melbourne, to turn to the AUKUS alliance, the Virginia-class SSN and the SSN-AUKUS nuclear attack submarine, Naval group has worked hard to establish itself in international competitions, including by coming directly to hunt in Germany, a great leader in this field since the 80s.

However, the current negotiations are all complex, highly contested, and constrained by numerous parameters. They show, however, that Naval Group is particularly combative, and that the industrialist has positioned itself in a particularly promising set of markets.

Netherlands: The parliamentary wall remains to be passed to confirm the 4 Blacksword Barracuda

After Indonesia, the confirmation of the success of the Blacksword Barracuda, in the Netherlands, is undoubtedly the file most awaited by Naval Group. In mid-March 2024, the Dutch ministry had, in fact, announced the victory of the French industrialist, concerning the call for tenders for the replacement of the four Walrus-class submarines.

While national preference seemed to prevail in favor of the Damen-Saab alliance, it was the French Blacksword Barracuda, a more compact version of the Shortfin Barracuda initially selected by Australia, which was selected by The Hague. And for good reason: it quickly became apparent that the French offer was 1,5 billion cheaper€, than that of its competitors, or 25% of the price of the program, according to the Batavian specialist press.

Blacksword Barracuda
If Naval Group manages to convince the Dutch parliament, it will benefit from a considerable competitive advantage over TKMS and Kockums in future competitions.

It is impossible, under these conditions, for the arbiters of the call for tenders to give effect to national preference. However, Naval Group's victory was presented with significant reservations by the Ministry of Defense, since it was described as "temporary", at least, until validation by the Dutch Parliament.

Since then, Damen, like TKMS, has multiplied declarations in the press and lobbying actions with parliamentarians, to question the honesty of the French offer, believing that it is impossible for the industrialist to be able to produce such high-performance ships. with such a price difference.

While validation by the Batavian Parliament, now in the hands of a coalition with a nationalist majority, must take place at the beginning of June, it is now up to Naval group to effectively justify such a price difference. If it succeeds, it will then record the first European order for French submarines, since the Spanish Agosta, at the end of the 70s.

India: order for 3 additional Kalvari-class Scorpene postponed after Indian elections

The second file in short final, for the submarine division of Naval group, concerns the 3 Kalvari class submarines, whose order was announced on the occasion of Narendra Modi's visit for July 14, 2023, alongside 26 Rafale Marine.

However, almost a year later, none of these contracts have been formalized by New Delhi, despite the urgency, whereas in the absence of Rafale M, the new aircraft carrier Vikrant simply does not have an onboard air group.

Kalvari India
The order for 3 additional Kalvari submarines, announced in July 2023, has been postponed beyond the Indian legislative elections.

Above all, as mentioned previously, the industrial tool built by Mazagon Shipbuilding and Naval group, around the P75 program and the six Kalvari, is now threatened by the lack of activity, while neither the three additional Scorpene, nor the six new sub -AIP sailors from the P75i program, have not been ordered.

Unable to be concluded before the end of 2023, the negotiations for the 3 Kalvari and the 26 Rafale M, have been postponed beyond the Indian legislative elections, which are due to be held in early June.

However, we can expect that the additional six months of delay in negotiations will have been taken advantage of by the Indian Navy and Naval Group, in particular with regard to the Scorpene Evolved and its lithium-ion batteries.

Much more efficient than the classic Kalvari batteries, or the AIP systems which must equip the six submarines of the P75i program, these batteries can, in fact, appeal to the Indian Navy, well beyond the three submarines mentioned, with a possible spillover onto the P75i program, which is becoming less and less attractive in New Delhi.

Poland: Naval Group can believe in its chances for the Orka program of 3 submarines

Launched around ten years ago, the Polish Orka program has undergone numerous developments. In recent years, Naval Group's chances seemed compromised, given the policy pursued by the ruling Polish Conservative Party PiS, excluding as much as possible French or German equipment for arms contracts. The arrival of Donald Tursk and the center-left pro-European coalition at the head of the government now changes the situation on this issue.

Several offers have been sent to Warsaw concerning the Orka program, which involves the construction of three conventional submarines with ocean capabilities, including a German offer, a Swedish one, a Spanish one, a South Korean one and, of course, a French offer , who could well win uncontested in this competition.

MBDA MdCN Suffren
France has made the arming of the submarines offered to Poland a particularly effective argument.

Paris offers, in fact, in addition to a high-performance submarine model equipped with lithium-ion batteries, a set of equipment and weapons with proven operation, such as the F21 heavy torpedo, the SM39 anti-ship missile, and especially the missile. MdCN cruise. It even seems that the French authorities have approved a co-production of these missiles, which would make it possible, and this is the aim, to lift the international maximum range limit to 300 km, associated with the export of cruise missiles, which no other manufacturer, not even Hanwha Ocean, can offer.

It should be noted that if, until now, the Scorpene model, potentially Evolved, has always been presented as the support for the French offer, we can think, today, that Naval Group was able to offer the same Blacksword Barracuda in Warsaw than that retained by The Hague, perhaps with the objective of creating a Blacksword club between the two European countries, to optimize production and maintenance costs.

Indonesia: 4 additional submarines to come

Beyond the two Scorpene Evolved ordered a few months ago by Jakarta, the Indonesian Navy intends to acquire, in the coming years, 4 additional submarines, to reach a fleet of 12 submersibles.

Obviously, Naval Group and the Scorpene Evolved have all the cards in hand to win in this upcoming competition. Indeed, the entire industrial tool and subcontracting network will have been organized around the production of Scorpene Evolved. It would therefore be much more efficient and economical to reuse them to produce the last four submarines expected by the Indonesian Navy, than to turn to another model.

Scorpene Evolved
If Naval Grou and PT Pal are satisfied with the construction of the first two Scorpene Evolved, there would be no objective reason for Jakarta to turn to another model for the next 4 submarines.

The fact remains that after the episode of the South Korean Nagapasa class submarines, derived from the Type 209 batch I of the Jang Bogo class, and the numerous industrial difficulties and technical failures encountered, Jakarta chose to prioritize security, and to only commit to two ships.

It is up to Naval Group, and its partner PT PAL, to prove themselves, by delivering the two ships on time, in hours, and with the expected quality. In doing so, it would be very surprising if the Indonesian authorities decided to turn to another model for the four remaining submarines to be produced.

Around ten competitions and discussions in progress for French submarines

Beyond these four files, Naval Group is engaged in more or less exclusive and/or advanced discussions, for the sale and construction of submarines for export.

In Europe, discussions with the Romania, for the construction of two Scorpene, had quickly advanced until 2022, and the decision, by Bucharest, to give priority to the acquisition of tanks, self-propelled guns, IFVs and American and South Korean combat aircraft, to make in the face of the evolving Russian threat.

In Asia, the Malaysia announced a year ago its intention to acquire additional submarines, in addition to the two Scorpene previously acquired. THE Philippines, for their part, were actively courted by France and Spain, to create the country's first submarine fleet. This project is, however, weighed against other military budgetary decisions, notably the acquisition of combat aircraft, in particular to cope with the growing pressure from the Chinese Navy in the South China Sea.

Scorpene Brazil
Naval Group wants to make Brazil its industrial and commercial platform, to establish itself in South America.

South America is also a promising continent. In fact, theArgentina had indicated its intention to reconstitute a submarine fleet, after having put its own on hold after the Santa Fe tragedy. As with the Gowind OPVs, Naval Group was considered the preferred partner for such a program. However, the recent acquisition of Danish F-16s by Buenos Aires will probably have emptied the investment capacities of the Argentine armies for several years.

In contrast, the Chilli will have to replace its two Type 209s, while the Chilean Navy, the first historical operator of the French submarine, is full of praise for it. Likewise, the Colombia will also have to replace its two Type 209s, as well as the two Type 206s acquired second-hand around ten years ago.

Above all, the Franco-Brazilian cooperation seems ready to take a new step in the field of submarines, whether it involves increasing the support of the French naval industry, in the Brazilian nuclear attack submarine program, but also for act as an industrial and commercial pivot of the French offer in the field of submarines.

North Africa and the Middle East complete this world tour of Naval Group's commercial opportunities in terms of submarines. First, in the Mediterranean, with the Morocco which is studying the possibility of acquiring a submarine fleet, in particular to contain the rise in power of its Algerian neighbor, which can rely on the support of Moscow in this area.

Gowind 2500 Egypt
The Egyptian Navy is already using 4 Gowind 2500 corvettes and 2 BPH Mistral class from Naval group.

Egypt, for its part, would have started negotiations with Naval group to acquire six Barracuda ocean submarines. Such a contract would, of course, be strategic, both for Cairo and for the industrialist, but the Egyptian authorities would not have the necessary financing capacity for several years.

Finally, recent indiscretions have reported discussions between France andSaudi Arabia, on subjects of extensive military and industrial cooperation, ranging from fighter Rafale, to the creation of a Saudi submarine fleet.

Conclusion

As we can see, the coming weeks will prove decisive for Naval group, and particularly for its submarine branch. If everything goes as planned, he could, in fact, obtain validation of the order for the three additional Indian Kalvari submarines or any other development around this contract, as well as that of the Dutch Parliament, for the order of the 4 Blacksword Barracuda.

A validation, in this case, from The Hague, could open the door to a new particularly prosperous period for French submarine construction, by validating, on the international scene, cost prices much lower than those of the European competitors, without sacrificing performance.

We understand, thus posed, that this parliamentary arbitration could prove even more decisive for the other European manufacturers, TKMS and Saab-Kockums, who could emerge with an excessive price tag. It is not surprising, in these conditions, that the two European companies are particularly aggressive on this subject, fearing, most certainly, the consequences of an unfavorable arbitration on their international image.

A victory, for Naval group, would, on the other hand, make it possible to definitively turn the page on the Australian failure, with a commercial potential without equivalent on the international scene, to convert into success the numerous files opened by its teams of negotiators.

Article from May 22 in full until July 21

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