Japanese media reports Japan has won Australia’s AU$10 billion frigate deal, with official confirmation still pending.
Update 5/08: Official confirmation by Australian Government Department of Defence on the selection of Upgraded Mogami.
Japanese media Nikkei was the first to break the news overnight Australian time that the Upgraded Mogami or 06FFM is the desired design for SEA 3000. Mitsubishi Heavy Industries would now receive preferred candidate-status in an effort to procure up to 11 new multirole frigates for the Royal Australian Navy. Only two days previously The Australian reported that a decision by Canberra on the much reported on, yet also very opaque competition eventually putting the Japanese against German builder TKMS was imminent. The Australian suggested a formal announcement is to follow within the week. Nikkei refers to a senior Australian government official having informed Japanese government about the decision.
The revelation and timing may be awkward for Australian government. Canberra has previously revealed little about the ongoing decision-making and negotiations with candidate industrial bidders from Spain, South Korea, Germany and Japan. When enquiring about particular details of the ongoing effort, Defence media contacts repeatedly emphasised probity as rationale to not comment on SEA 3000. Industrial candidates signed non-disclosure agreements with the Australian government, resulting in very little detail on their bids in the public sphere.
The down-select means Australia would now proceed to conduct detailed contract negotiations with MHI. A contract signature, expected before the end of the year, is still subject to agreement on price and other conditions. Should negotiations prove unsatisfying, government could revert to approaching TKMS instead, although the odds of this appear slim for now.
A win by MHI in SEA 3000 with the Upgraded Mogami, or 06FFM in Japanese government parlance, would represent the first formal warship export and by far the largest defence deal to date for the country. SEA 3000 has an estimated value between 7and 10 billion AU$ over the next ten years. Japan last year has landed a major contract building new coast guard patrol ships for the Philippines. Tokyo has also exported military equipment such as radar systems to Manila.
This story has been revised to add the official confirmation by Australian Government.
