The Royal Australian Navy is looking for a few good submarines.
Actually, more than a few. According to a new government white paper released Thursday, the government of Australia plans to replace its existing fleet of six diesel-electric Collins-class submarines with new conventional (aka non-nuclear) submarines of a design yet to be determined. More than that, Australia says it will double the size of its submarine fleet to 12 vessels.
Dubbed "The Future Submarine project," Australia says this replacement and expansion of its sub fleet "will be the largest and most complex Defence project ever undertaken by Australia." The first step will be to spend $214 million on detailed studies and analysis to choose the right submarine variant. Broadly speaking, Australia says it sees four options for the expansion:
- An existing submarine design available off-the-shelf, modified only to meet Australia's regulatory requirements.
- An existing off-the-shelf design modified to incorporate Australia's specific requirements, including in relation to combat systems and weapons.
- An evolved design that enhances the capabilities of existing off-the-shelf designs, including the Collins class.
- An entirely new developmental submarine.
The common factor in all these variants is Australia's intention to use Raytheon's (NYSE:RTN) AN/BYG-1 advanced submarine combat control system to fight the boats. As for the rest of the plan, the country has time to work out the details. According to the white paper, the RAN's Collins-class fleet is good for 28 years of service life per sub, suggesting they won't start going obsolete until 2024 at the earliest.
Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of Raytheon. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.