The UK Ministry of Defence (MOD) has awarded £3.95 billion (A$7.5 billion) to BAE Systems for the next phase of the UK and Australia's next-generation nuclear-powered attack submarine program.
According to the MOD, the first British submarines will be delivered in the late 2030s and the first Australian submarines in the early 2040s.
The funding follows the trilateral AUKUS announcement in March. This will eventually see Australia and the UK operate SSN-AUKUS submarines, which will be based on the UK’s design and incorporating technology from all three nations.
"The signing of the Detailed Design and Long Leads (D2L2) Phase with BAE Systems (BAES), Rolls-Royce and Babcock Marine represents a significant milestone for both the UK and the trilateral AUKUS programme as a whole, in the lead up to build the future class of nuclear-powered attack submarines, known as SSN-AUKUS," the UK MOD said in a statement.
The contracts totalling £4 billion (A$7.6 billion) will progress the program through the design, prototyping and purchase of main long lead components for the first UK submarines.
"This multi-billion-pound investment in the AUKUS submarine program will help deliver the long term hunter-killer submarine capabilities the UK needs to maintain our strategic advantage and secure our leading place in a contested global order," Grant Shapps, UK Defence Secretary, said.
SSN-AUKUS will be the largest, most powerful and advanced attack submarines either the Royal Australian Navy, or the Royal Navy, have ever operated. It will eventually replace the UK's Astute class, which BAE Systems builds at its site in Barrow-in-Furness, Cumbria; and RAN's Collins class submarines and the Virginia class boats it intends to lease.
Having started early design work in 2021, the A$7.5 billion will cover development work to 2028, enabling BAE Systems to move into the detailed design phase of the program and begin to procure long-lead items.
The company says manufacture will start towards the end of the decade with the first SSN-AUKUS boat due to be delivered in the late 2030s.
The award will also fund 'significant infrastructure investment' at BAE Systems' site in the UK's Barrow-in-Furness, investment in its supply chain and recruitment of more than 5,000 people in the UK.
It is unclear what elements of the boat will be designed or built in Australia, or how many jobs will be created in Australia.
Rolls Royce will provide the nuclear reactors for the SSN-AUKUS vessels, and Babcock is also involved through a five-year deal to provide input design for SSN-AUKUS with the UK MOD. It was also recently announced that Babcock International Group and HII have partnered to support capability requirements for SSN-AUKUS.
“We are delighted to be asked to play our part in delivering this element of the AUKUS Agreement and are well prepared to support through our nuclear expertise and engineering excellence," Steve Carlier, President Rolls-Royce Submarines, said. "For over 60 years we have provided the power to the Royal Navy’s nuclear submarines and we are proud to be playing a critical role in helping Australia acquire their own nuclear propulsion submarine capability."
Babcock’s contract scope includes applying its experience of complex submarine in-service support and maintenance, to build this into the design to maximise the submarines’ availability throughout its service life. This contract award builds on work Babcock has already been delivering during the previous Program Definition and Design Phase.
“Babcock plays a critical role in submarine programs, supporting submarine availability in the UK and internationally," Babcock CEO David Lockwood said. "The importance of applying our extensive knowledge and long-standing experience is being recognised through this contract award to ensure that the new Class delivers the operational availability through life that the Royal Navy requires.
“In addition, we look forward to providing ongoing support to help deliver capability for the Royal Australian Navy under the AUKUS agreement.”