Pacific 2008: Raytheon eyes long term naval opportunities | ADM Dec 07/Jan 08
By Gregor Ferguson
It has taken less than ten years for Raytheon Australia to secure a strong, even dominant position, in Australia's naval market as a combat systems integrator. The company has played its cards with an eye on the long term.
You couldn't build a modern warship without at least a bit of Raytheon involvement: Royal Australian Navy's (RAN's) Anzac and FFG frigates and Air Warfare Destroyers, between them, will boast Evolved Sea Sparrow Missiles (ESSM), SPS-49 radars, SM-2 missiles and a range of other active and passive sensors and fire control systems.
These systems are sourced largely off the shelf from the US; Raytheon Australia Pty Ltd (RAPL), however, has leveraged its position in this country to the point where no new surface or sub-surface platform is likely to enter service with the RAN over the next generation or so without a significant input from RAPL as a systems engineer or integrator.
The company employs 1,300 people across Australia in four principal business areas, according to managing director Ron Fisher: Aerospace, Land, Naval and Integrated Technical Services.
The latter, based in Canberra, looks after base operations, including support for the Pine Gap and Tidbinbilla defence and space facilities.
Raytheon Australia's 260-strong Naval Division is based at North Ryde in Sydney, with a significant presence in Western Australia and South Australia.
North Ryde is the company's centre of excellence for systems engineering and architectures. For that reason it's also where Raytheon's bid for Project Air 7000 is based.
The company's current naval operations are well known: in WA, where it is the flagship tenant at the Australian Marine Complex at Henderson, adjacent to Fleet Base West, it supports the legacy combat system for the Collins-class submarine fleet, as well as the augmented combat system (CSA).
With the recently refitted HMAS Waller now on trial over in the west, RAPL also supports her new Replacement Combat System (RCS), which will undergo its biggest test in mid-2008 at RIMPAC in Hawaii.
From Fremantle RAPL (not the US parent company) is also bidding into the Canadian Navy's Joint Support Ship (JSS) program as a partner of prime contractor SNC Lavallan.
RAPL will be electronics systems integrator; the team is currently completing a 14-month funded Project Definition Study, which will end in March 2008 with a source selection due in the final quarter of the year. The other bidder is a team led by Thyssen Krupp.
In South Australia Raytheon supports the Collins legacy combat system and RCS, but its emerging focus is, of course, the Air Warfare Destroyer, for which it is the Combat System Systems Engineer (CSSE) and a key part of the tripartite AWD Alliance with the Commonwealth and ASC Shipbuilder Pty Ltd.
Company practice
The company's 'Hub and Node' approach is borrowed from its US parent and works in Australia for the same reason it works in the US.
RAPL's customers are spread across multiple locations; in some cases these are locations where it would be hard or impossible to recruit and sustain engineering teams able to tackle the work required on-site.
Raytheon has instead developed collaborative environments which allows it to share work across sites: the hub remains the centre of excellence and of customer focus for a particular activity, with the hubs providing resources.
This makes recruiting and retention easier and the resulting national 'gene pool' of engineers and project managers enables the company to ride the peaks and troughs of localised economic up-and down swings, according to Ron Fisher.
For the Collins RCS North Ryde is the hub, with four Commonwealth personnel embedded there and strong links to SA, WA and also to the USA.
However, as the RCS enters service the hub will be shifted to WA, adjacent to the submarines' home port at Fleet Base West.
The Hub and Node model does depend, however, on first-class communications between the sites and standardised processes and procedures. RAPL has adopted these from its US parent.
This includes the Integrated Product Development System (IPDS), a standardised development process which Fisher says is an important benefit of the 'reachback' Raytheon enjoys to its parent.
There's nothing unique about this approach, he points out - most large Australian companies have had to adopt something similar, but Raytheon's edge lies in its implementation, he says; it has spent a lot of money to make it sure it works by training people on the company's tools and processes.
This model will be applied to the AWD Alliance, says Fisher, with Adelaide as the hub and North Ryde and Fremantle as the nodes.
In due course, when the AWDs are home ported at Fleet Base East in Sydney, RAPL will be able to shift the hub across to the east Coast without having to create an all-new facility on a Greenfield site as was the case with the Collins and Anzac support facilities in WA.
AWD integration
The mechanics of delivering the RCS and integrating the combat system for the AWD are daunting, not least because of the US government's ITAR restrictions which are notorious for slowing projects.
The AN/BYG-1 combat system for the Collins-class submarines, which is based on Raytheon's CCS Mk2 command and control system, was acquired by the RAN under an Armaments Cooperation Program (ACP) agreement; this differs from the more widely known Foreign Military Sales (FMS) agreement by enabling joint development of a product with the US service concerned, rather than just a straight purchase.
The basic process requires the US Navy's Underwater Warfare Centre (NUWC) at Portsmouth, Rhode Island, to certify the system.
This then comes to Australia where Raytheon assembles a range of Australia-unique products and capabilities and integrates them with the core BYG-1 system.
However, to make this work, Raytheon had to develop an interface between the BYG-1 core and the other elements.
This so-called Collins Sensor Data Server also required certification by NUWC before the RCS could be developed.
The Hub and Node model allows Raytheon then to undertake box-level Category 1 testing of the RCS hardware and software at North Ryde; Category 3, or system-level testing, is done at in Fremantle; and Category 4 harbour trials are carried out by the Raytheon team in Adelaide.
Through-Life Support for the RCS/BYG-1 will be handled from Fremantle. The two-way street between Australia and the US is a contentious topic.
While Australia buys a lot from the US, it's not obvious to some Australian companies that the US buys very much in return.
Mutual benefit
According to Fisher, the benefits the US Navy derives from the ACP agreement are more subtle than a straight barter of products and capabilities.
As the Collins-class boats are smaller and have less electrical power available for operations and cooling than the US Navy's Virginia-class boats, which also use the BYG-1, the Collins RCS requires a very elegant, efficiently engineered installation.
The US Navy is keen to harness some of these Australian-driven efficiencies, says Fisher; similarly, with smaller crews and less space for consoles, the Collins-class RCS is highly automated.
The US Navy is keen to adopt this Australian functionality also. So how does the ITAR issue impact on all this? And will the mooted Australia-US Treaty on Defence Trade Cooperation change anything as far as Raytheon is concerned?
Hardly at all; and not much, is Fisher's view. Despite the more open environment of the ACP agreement, ITAR requirements still forced Raytheon to create an ITAR-compliant facility in North Ryde with appropriate procedures, fire walls and air gaps to protect US data.
The new Treaty has the potential to make things easier, at least for RAPL directly, and probably also its major Australian suppliers and partners, but the company couldn't assume it would be ratified either quickly or completely by the US Congress, so for the AWD program it has set up a similar, efficient ITAR-compliant infrastructure.
The AWD combat system design is still under development but its core is, of course, the Lockheed Martin Aegis Air Warfare System (of which some 30 per cent is provided by Raytheon, Fisher points out).
Australian Aegis
The top-level architecture for the combat system has been settled, but the detail of interfaces with the Australia-unique sensors and effectors, and the choice of these items, remains to be resolved, Fisher said.
Like the BYG-1, the Aegis system and SPY-1D(V) radar will be certified by the US Navy under its FMS agreement with the RAN; if it is decided that something similar to the Collins Sensor Data Server is required, this would also need to be certified, believes Fisher.
In any case, RAPL has reached back to its parent for some domain expertise and five US personnel are currently located within the AWD Alliance to share their expertise.
Fisher believes Australian engineers are more than capable of dealing with the complexities of the Aegis system and its interface requirements, so in that sense there are no inherent risks associated with the Australian program.
As noted elsewhere in this edition of ADM, the process of soliciting tenders for the non-Aegis sensors and equipment for the AWD is about to get under way, with the sonar suite as the first cab off the rank.
Also to follow are the communications system, the Electronic Surveillance and Attack (EA and ES) systems, elements of the fire control system and things like the EO/IR sensor.
The first AWD is due to be delivered in 2014, which means RAPL's systems integration work must be completed well in advance of this date.
By that time the Collins RCS will be delivered also. What comes after these programs for RAPL's naval business?
Future naval work
The next two big naval programs are Sea 5000, the eventual replacement for the Collins-class submarines, which will be foreshadowed in the next Defence Capability Plan; and the eventual replacement for the Anzac-class frigates, some time after 2020.
It's hard to imagine the RAN developing an all-new submarine combat system on its own; more likely is a derivative of whatever combat system the US Navy plans to use from about 2020 onwards.
Fisher says the US Navy's plans for an RCS are currently based on an iterative Technology Insertion Program, rather than an all-new system.
Australia might be well attracted to this 'evolutionary acquisition' approach, which would significantly de-risk the new submarine project. RAPL aims to be the 'customer's friend' in grappling with these issues, says Fisher.
This would certainly put the company in a strong position to help develop whatever combat system the RAN believes it should adopt in its new boats.
The Anzac replacement is a trickier issue. This will not be an Aegis ship, not least because the Aegis system will no longer be in production at that time.
The RAN will need to identify potential combat system architectures and options, says Fisher; again, Raytheon is well-placed to be a 'customer's friend' through this process.
The issues are intriguing: if the RAN believes the capabilities of these new surface combatants would benefit from close ties with the US Navy, then much will depend on what combat system the US Navy selects for its own surface fleet going forward.
The Littoral Combat Ship program could see an open architecture 'plug and play' combat system which may be attractive to the RAN, especially if it adopts a ship similar in size and role to the LCS.
But it's also possible the US Navy could mandate a fleet-wide combat system based on the core of the system Raytheon is developing for the DDG-1000.
In that case, close allies like the RAN might want to pursue interoperability with the US Navy by adopting a similar system.
And the currently somewhat remote possibility of a common core for both ship and submarine combat systems can't be ruled out, either, though the very different sensor fits and the sensor processing and latency requirements of surface ships and submarines may dictate separate solutions, as they do currently.
In any case, RAPL is building itself a position in Australia where it has a deep insight into the RAN's future surface and undersea warfare requirements, the skills and infrastructure to be able to address them, and access to a US technology base that may prove decisive in the search for future business.
Copyright - Australian Defence Magazine, December 2007/January 2008