BAE wins £19.6bn Type 26 frigate deal with Australian navy

Nine ‘Future Frigates’ based on BAE Systems Type 26 warship will be built for the Royal Australian Navy as part of a major new deal for the UK defence giant.


BAE won the tender for Australia’s Sea 5000 programme ahead of Italy's Fincantieri SpA and Spain's Navantia. The AUD $35bn (£19.6bn) contract will see South Australia’s ASC Shipbuilding become a subsidiary of BAE, with production of the frigates taking place in Australia, rather than the Type 26’s Glasgow base.

According to the UK government, it is the first time since the 1970s that a British frigate design has been exported. It is expected that the programme will create around 5,000 jobs in Australia over a period of 30 years.  

“BAE Systems’ selection as preferred tenderer for SEA 5000 reinforces our position as a leading designer and builder of complex maritime platforms,” said BAE Systems chief executive, Charles Woodburn.

“I am proud that our world class anti-submarine warfare design and our approach to transferring technology and skills to the nations in which we work is expected to contribute to the development of an enduring world-class naval shipbuilding industry in Australia.”

BAE said that the new ships - to be known as the Hunter Class - will use suppliers from every state across Australia, with production slated to begin in 2020. While the deal is being hailed as major win for the UK defence industry, it is unclear to what degree the existing supply chain for the Type 26 will benefit. Gary Cook, from the GMB union, claimed the deal amounted to an export of British manufacturing jobs rather than an export of ships. Conversely, manufacturers’ organisation EEF said the contract was a vote of confidence for the UK defence sector.


“This win for BAE Systems and the UK defence industry is the result of years of hard work with government and industry working in close partnership,” said Stephen Phipson, EEF chief executive.   

“The decision by the Australian Government confirms the UK leadership in advanced frigate design and the strengthening of ties at both the industrial and defence level between our two nations, British expertise helping to transform the Australian shipbuilding sector.”