French naval shipbuilder DCNS Group beat Japan and Germany in winning a $43 billion contract to build 12 new submarines for the Royal Australia Navy based on technical and tradecraft factors, says defense intelligence specialist IHS Jane’s.

Tuesday’s announcement that DCNS’ 4,700-tonne Barracuda Shortfin 1A submarines will be tapped for the contract surprised Japan which had touted defense contractor Mitsubishi for the job. Prime Minister Shinzo Abe’s government wants to expand Japan’s military export business to Pacific nations and to expand defense cooperation with Australia to counter Chinese ambitions in the South China Sea.

DCNS Shortfin Barracuda
DCNS Shortfin Barracuda

IHS Jane’s analyst Jon Grevatt said in a Tuesday research note that DCNS can point to extensive submarine-industrial engagement in the Asia Pacific, unlike Germany and Japan. The analyst said “this is certain to have played a crucial factor in Australia’s decision” to tap the French defense maker.

Grevatt added that DCNS is currently involved in submarine license-building programs in India and submarine support programs in Malaysia that have both involved substantial transfers of submarine-related technologies and knowhow.

IHS Jane’s defense industry and budgets director Paul Burton noted that Japan showed weakness on the trade diplomacy side of the deal despite the landmark importance attached to winning the big sub contract.

“The tradecraft required to convince a sophisticated domestic buyer that Japan’s package was superior to that offered by France was lacking. For instance, Japan initially seemed to favor building the new subs in-country, and appeared slow to grasp the critical Australian political imperative for domestic production,” Burton said.

At the same time, Burton said that “Tokyo can be expected to learn quickly from this process.”

Australian Collins-class subs
Australian Collins-class subs

Ridzwan Rahmat, a senior naval analyst at IHS Jane’s believes that while political and strategic considerations may have played a part, the Australian decision to go with DCNS was primarily based on technical considerations.

“The 4,700-tonne Barracuda Shortfin 1A meets most of the requirements of the Future Submarine program in terms of sensors and stealth,” Rahmat said. He also noted the boats don’t differ much from Australia’s existing  Collins-class submarines in terms of endurance.

Other observers have said Australia would not choose Japan’s Mitsubishi to avoid increasing tensions with China which is already wary of Tokyo’s closer defense ties with the US and the Philippines in the South China Sea.

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