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AUKUS Submarine Deal Reshaped Amidst Cost Concerns

In 2021, the United States, the United Kingdom, and Australia announced the establishment of the AUKUS Triangular Security Partnership, aiming to provide Australia with nuclear submarine technology. The United States promised to sell Australia up to 5 nuclear submarines of the Virginia-class. The three countries also agreed to collaborate on the development of new types of nuclear submarines.

However, this cooperation has already sunk before any progress was made. According to reports by the Australian Broadcasting Corporation (ABC) on June 1st, the defense ministers of the United States, Britain, and Australia recently announced changes to their nuclear submarine procurement plans. Australia will now purchase three used Virginia-class submarines from the United States, rather than the previously planned one new submarine plus two used submarines.

During the Shangri-La Dialogue held in Singapore, U.S. Defense Secretary Heggseth, UK Defense Secretary Shili, and Australian Defense Minister Mars issued a joint statement on May 30, announcing the latest arrangements for the AUKUS project.

Statement: We welcome the proposal to streamline the process of acquiring Australian-built Virginia-class nuclear submarines, thereby simplifying supply chain management, operational and maintenance requirements, and maximizing cost-effectiveness. This approach would allow Australia to purchase three existing Virginia-class submarines, rather than combining the acquisition of new submarines with those already in service.

The statement describes this adjustment as a streamlining measure, aimed at simplifying supply chain management, operational and maintenance requirements, thereby achieving maximum cost-effectiveness.

AUKUS Submarine Deal Reshaped Amidst Cost Concerns

British Defense Minister Sheely (left), U.S. Defense Secretary Hagel (middle), and Australian Defense Minister Mars (right) attended a press conference in Singapore. IC photo

Mars stated on May 31 that purchasing three second-hand submarines could save Australia a significant amount of money. Using three submarines of the same model would also reduce the difficulty of operation and maintenance. He said, This is definitely a cost-effective option. Its important to note that this is a very expensive project. As we progress with this project, we are working hard to find every possible cost-effective solution.

Regarding the service life of second-hand nuclear submarines, Mars explained: All submarines will be handed over to us after completing their mid-term maintenance, or renovation. Their lifespan is sufficient to last until the future, until we begin to operate the new submarines that we have built in Adelaide.

Mars told ABC that there were no changes to the AUKUS agreement. If Australia needed it, it could still purchase two nuclear submarines from the United States. He added that the Australian government hopes to start building new nuclear submarines as soon as possible, so that there will be no need to continue purchasing nuclear submarines in the future.

Additionally, the defense chiefs of the United States, Britain, and Australia announced that the three countries will work together under the AUKUS framework to develop new weapons for unmanned underwater vehicles. Mars stated that the three countries will promote the delivery of this new technology starting from 2027. Hagersey said that the new unmanned underwater vehicles will help the three countries maintain their advantages in related technological fields. It is unclear how much funding the United States, Britain, and Australia plan to invest in this project.

The adjustment of the nuclear submarine procurement plan has sparked doubts within Australia. Critics believe that this reflects deep-seated flaws in the AUKUS project. Analyst Yvon Graham, who focuses on defense strategies in the Indo-Pacific region, speculates that Mars has provided a seemingly reasonable explanation, but its likely that Australia was merely forced to accept the new plan.

Another analyst, Michael Schubrich, pointed out that the U.S. Navy wants to keep the latest and most advanced submarines for itself, which is why they have adjusted their procurement plans. He argued that Mars claim that similar models of submarines are easier to maintain isnt valid, as the Australian Royal Navy base at Sterling is already required to be capable of maintaining all types of Virginia-class submarines.

AUKUS Submarine Deal Reshaped Amidst Cost Concerns

Source image: U.S. Navy Virginia-class nuclear submarine North Dakota – Reuters

According to ABC, although Australia is confident about its procurement plan, it remains uncertain whether the United States will be able to deliver nuclear submarines within ten years. The transaction must first receive approval from the White House. The White House may only approve the sale plan after the U.S. shipbuilding plants increase their production capacity for submarines.

Australian opposition parties have stated that they will conduct detailed inquiries regarding the adjustments to the nuclear submarine procurement plan during the Senate budget review hearings scheduled this week. James Patterson, the Australian Liberal Partys shadow defence minister, believes that the Australian government needs to provide explanations for this policy change, rather than simply glossing over it in a joint statement.

After US President Trump took office, the US Department of Defense conducted a review of the AUKUS agreement. This led to speculation that the United States might withdraw from this cooperation. However, during his meeting with Australian Prime Minister Albenes in October last year, Trump promised to fully promote the AUKUS agreement.

Hageth reiterated on May 30th: As we said from the beginning, we believe that censorship will only strengthen this partnership. The United States remains committed to the AUKUS partnership and is taking steps to enhance our joint submarine forces in the Pacific region.

However, the international community is generally concerned that cooperation among the United States, Britain, and Australia in the field of nuclear submarines will increase the risk of nuclear proliferation and undermine regional stability. Guo Jiakun, a spokesman for Chinas Ministry of Foreign Affairs, has stated that China has repeatedly expressed its stance on the establishment of so-called tripartite security partnerships between the United States, Britain, and Australia, as well as on the promotion of cooperation in nuclear submarines and other advanced military technologies. We consistently oppose the creation of, as well as any efforts to increase the risk of nuclear proliferation and exacerbate the arms race.