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Defence

BAE Systems and ASC to build Australian AUKUS submarines

The Australian Government has selected BAE Systems and ASC Pty Ltd to build Australia's new fleet of nuclear powered submarines in the latest significant development in the AUKUS trilateral security pact between the US, UK and Australia.



Image courtesy BAES Systems

Australian Deputy Prime Minister, Richard Marles and UK Defence Secretary, Grant Shapps, announced the news in Australia, marking the next step in the pathway for Australia to build and operate its own nuclear powered submarines.

Defence Secretary Grant Shapps said: "In a more dangerous world, today’s announcement symbolises the huge confidence our close partner Australia has in our world-leading defence industry, including companies such as BAE Systems and Rolls-Royce.

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"Through these collaborations, British industry will grow and thousands of jobs will be created across the country, delivering security and prosperity to our two nations."

Opportunities through the AUKUS supply chain for British industry could be worth billions across the life of the Australian submarine programme. That includes Rolls-Royce, which will deliver the nuclear propulsion plants for the Australian programme.

As announced in March 2023, Australia has agreed to make a significant investment into the UK’s submarine industrial base, including Rolls-Royce, Sheffield Forgemasters and their supply chains, to support the delivery of the Australian SSN-AUKUS programme. This investment, alongside funding from the UK Ministry of Defence, will enable the Rolls-Royce Derby site to double in size, with a further 1,170 highly-skilled jobs created. These jobs are part of the 7,000 additional British jobs that the UK’s and Australia’s AUKUS submarine programme will generate through their life. At the peak, there will be over 21,000 people working on the SSN-AUKUS programmes in the UK – concentrated in Barrow-in-Furness and Derby.

CEO of BAE Systems, Charles Woodburn, said: "We’re extremely proud of our role in the delivery of this vitally important, tri-nation submarine programme. Our selection as a partner in Australia, alongside ASC, recognises our role as the UK’s long-term submarine design and build partner and as a key player in Australia’s maritime enterprise and wider defence landscape. Drawing on decades of experience in the UK and Australia, we look forward to working with ASC to develop an enduring, sovereign nuclear-powered submarine building capability for Australia.

"We’re already making good progress on the design and development of the next generation submarine in the UK where we have more than 1,000 people working on the SSN-AUKUS programme and major infrastructure investment underway.

"This latest step will ensure an integral connection between the UK design and the build strategy development in Australia as we work together to deliver next generation military capability as well as considerable social and economic value to all three nations."

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Rolls-Royce Submarines President, Steve Carlier, said: "Last year we were proud to welcome the Hon Richard Marles MP, Australia’s Deputy Prime Minister and Minister for Defence and UK Defence Secretary Grant Shapps to our Raynesway site and showcase some of the world-class manufacturing and engineering capabilities we have developed over the last 60 years.

"This commitment of funding to our existing expansion work shows the trust Australia places on our nuclear expertise and our ability to deliver. We look forward to working with the Australian Submarine Agency to support them in building their own fleet of nuclear-powered submarines."

Under the AUKUS agreement, Australia and the UK will operate a common submarine of the future, incorporating technology from all three nations, based on the UK’s next generation design which BAE Systems is leading.
 
BAE Systems and ASC Pty Ltd will now bring together their complementary skills, expertise and capabilities under a collaborative arrangement in Australia, ultimately leading to the establishment of a long-term, incorporated Joint Venture.

SSN-AUKUS will be the largest, most powerful and advanced attack submarines the Royal Navy has ever operated and will start to replace the Astute class, which BAE Systems is building at its site in Barrow-in-Furness in the North West of England, from the late 2030s. Australia expects to deliver its first SSN-AUKUS submarine in the early 2040s.
 
The UK Ministry of Defence awarded BAE Systems almost £4 billion for the next phase of the SSN-AUKUS programme in October. The funding covers development work through to 2028, enabling BAE Systems to progress the detailed design phase of the programme and procure long-lead items. The award is also funding significant infrastructure investment in Barrow, which will see the site's facilities double in size from 80,000 to 160,000 m2 by the late 2030s, as part of a multibillion-pound programme and continued recruitment to support the national endeavour.
 
BAE Systems has already increased its UK submarines workforce to 13,500 with plans to grow to around 17,000 at its peak to support SSN-AUKUS in the UK, as well as the Astute and Dreadnought programmes, providing a significant employment boost for the region. The company is the UK’s long-term submarine build partner and brings critical nuclear-powered submarine building experience and intellectual property. The involvement of BAE Systems in Australia ensures an integral connection between the SSN-AUKUS design led by BAE Systems in the UK and the development and maturation of the Australian build strategy.
 
BAE Systems has already delivered five of seven Astute class submarines to the Royal Navy in the UK, with the remaining two boats at advanced stages of construction at its shipyard in Barrow-in-Furness. The Company is also designing and building the UK's next-generation nuclear deterrent submarines, Dreadnought, with construction underway on the first three of four new boats.

In Australia, BAE Systems has a 70 year heritage providing advanced defence technology from air and maritime sustainment to shipbuilding.

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