August 7, 2019 |
International,
Naval
By: Andrew Chuter
LONDON — The Northern Irish shipyard that built the Titanic ceased business Aug. 5, and its part in a bid to build a new class of the general-purpose frigate for the British Royal Navy appears to have sunk with it.
Harland and Wolff was the lead U.K. yard in a proposal by German-based warship company Atlas Elektronik to build five Type 31e frigates for the Royal Navy.
But the Belfast shipyard of Harland and Wolff went into administration after a 158-year history, which included production of the Titanic and ended with its parent company insolvent and running out of offshore renewable-energy work that had become the mainstay of its business.
Industry executives, who spoke on condition of anonymity, said that unless Atlas has a plan B, the bid has likely been scuttled by the Belfast yard slipping into administration and thus putting the jobs of 125 on-site workers at risk.
Atlas Elektronik UK did not return calls regarding its bid.
British warships must be locally built, but designs can be foreign. Atlas Elektronik UK is offering parent company ThyssenKrupp Marine Systems' Meko A200 frigate to Britain. Currently, Atlas Elektronik and its U.K. partners Harland and Wolff and Ferguson Marine Engineering of Scotland are vying for the deal against rival proposals led by BAE Systemsand Babcock International.
An announcement by the Ministry of Defence on a winning bidder for the program worth more than £1.25 billion (U.S. $1.52 billion) could come next month. The procurement competition was aimed at breaking the local maritime monopoly of BAE Systems.
Sharing work across the shipbuilding sector via the Type 31e was part of a national shipbuilding strategy published by the British government in 2017. A strategy review was completed this year by its author, John Parker, but the findings have not been published by the MoD.
New Defence Procurement Minister Anne-Marie Trevelyn, the fourth such minister in three years, will likely give Parker's findings a close review. Trevelyn has no previous ministerial experience, but she is known in maritime circles for her membership of Parliament's all-party group on shipbuilding and ship repair, which recently published a report advocating for the domestic production of a new fleet of logistics support ships.
However, it's unclear how long the government, and hence the new ministerial team at the MoD, will survive given the political uncertainty here around Britain's exit from the European Union and murmurings of a general election.
Buy British?
The logistic vessels, known here as fleet solid support ships, are not considered military vessels by the British government; this is so the government can procure them more cheaply overseas. A competition is underway with a U.K. team led by BAE Systems bidding against overseas rivals.
But the tide may be turning, as there's parliamentary pressure that two or three large supply ships be built locally.
The industry executives who spoke to Defense News said that although the upcoming DSEI defense show had been touted as a possible venue for some kind of an announcement, the timing was — like most other defense issues — clouded by political uncertainties, including the appointment of a new defense secretary and defense procurement minister as part of the government reshuffle by the new prime minister, Boris Johnson.
An MoD spokesman said the department wouldn't provide a running commentary on the Type 31e competition or Harland and Wolff's part in it. However, the spokesman did suggest an announcement could take place after DSEI.
“It would be inappropriate to comment on Harland and Wolff's involvement in the Type 31e program, whilst this is subject to an ongoing competition," the spokesman said. “The competitive design phase is proceeding to schedule. The outcome of the competition for the design and build of the ships will be announced by December 2019.”
All three bidders have been in a competitive design phase ahead of submitting their proposals in late June.
The MoD previously ran a competition for the Type 31e (the "e" stands for export), but it halted the procurement effort when all of the bidders failed to submit fully compliant bids.
The Royal Navy wants the first of the five Type 31e frigates handed over during 2023 to start replace aging Type 23 frigates in its fleet.
Some analysts and industry executives think that's a tall order.
The government originally demanded a price tag of no more than £250 million per frigate, although earlier this year, industry executives said the budget restriction had been abandoned, as the MoD agreed to supply more equipment and systems at its own expense.
Atlas Elektronik isn't the only company with Harland and Wolff on its team. Babcock International also listed the Northern Irish yard in its proposal. But Babcock has various options, including using its site at Rosyth in Scotland, where the second of two aircraft carriers being assembled for the Royal Navy is now virtually complete.
“Our solution for the T31(e) requirement includes a flexible U.K. build approach that can accommodate the use of a range of delivery sites,” a Babcock spokesman said.
BAE's plan is to build it's Leander-class warships at the Cammell Laird yard near Liverpool while its own yards on the River Clyde in Scotland focus on completing the design and build of eight Type 26 anti-submarine warfare frigates destined for the Royal Navy. Three have been ordered so far.
Steve Turner, the assistant general secretary for manufacturing at the Unite union, said there are strategic defense interests why the Belfast yard should be saved.
“The shipyard works with BAE on the Dreadnought [nuclear] submarine program, has an important part to play in the building of the Royal Navy's new Type 31e and is central to the U.K. consortium's bid to build the Navy's fleet solid support ships,” Turner noted. “All this proud workforce needs is a temporary boost from government and a commitment from U.K. ministers that they will back U.K. shipbuilding by block building the new fleet solid support ships in yards across the UK."
Harland and Wolff is not the only potential Type 31e supplier in a tough spot. Ferguson Marine, which has a yard on the River Clyde and has been part of the Atlas and Babcock proposals, is experiencing significant cost and time overruns building two ferries. Nationalization by the Scottish government is one option under consideration for the financially fragile company.
https://www.defensenews.com/naval/2019/08/06/a-hazy-future-amid-a-competition-to-build-british-frigates-a-uk-shipyard-hits-hard-times/
