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Austal

Austal is the largest commercial shipbuilder in Australia. The company established operations at Henderson in Western Australia in 1998 and at Mobile in Alabama in 2001. In Western Australia, the company employs 1,100 staff at three sites, while it intended to grow its U.S. workforce to over 1 000 staff by December 2006. Despite its recent growth, Austal was relatively small compared to the other primes. Its turnover was $65 million compared to ASC ($229 million), ADI Limited ($656 million) and Tenix Defence ($650 million).

Austal commenced operations in 1988 with a vision to build high quality commercial vessels for the international market. Today, Austal is a world leader in the design and construction of customised aluminium defence and commercial vessels, and is proud to list amongst its customers many of the worlds leading ferry operators and defence forces.

With shipyards in Western Australia and the United States of America (Mobile, Alabama), Austal has delivered more than 220 vessels for customers around the world. Austals product range includes passenger and vehicle-passenger ferries, patrol boats, theatre support vessels, combat ships, multi-role vessels and luxury private live-aboards. Austal is also an established provider of worldwide vessel maintenance and management services.

Austal listed on the Australian Stock Exchange in December 1998 and has diversified its product base through the acquisitions of Western Australian shipbuilding companies Image Marine and Oceanfast, and Canberra-based Australian Technology Information. Austals USA shipyard was established in late 1999, and is now one of the largest employers in the Mobile area.

In 2003, Austal won the $553 million contract to supply the RAN with 12 Armidale class patrol boats. Mr Bob Wylie, a Visiting Fellow at the Australian Defence Force Academy, has noted that Defence's contract for the Armidale class helped Austal enter the Australian defence market. Instead of insisting on mandatory specifications for the vessels, Defence framed the tender in terms of the operational performance that it wanted. Austal met these performance requirements.

Austal's key U.S. naval contract is as the designer and builder of the Littoral Combat Ship (LCS) platform. It supplies the LCS as a trimaran solution for the U.S. Navy. Austal's LCS ship has a scheduled production timeframe of two years, compared with around four years for a regular combat ship. As the designer and builder of the vessels, Austal is able to tailor construction for its shipyard's build processes, and thereby minimise modifications. If the LCS program proceeds as planned the US Navy may require up to 60 vessels with an estimated project value of US$15 billion.

Austal believed the largest potential for growth in its shipbuilding business is in the patrol/defence sector. It emphasised that Australia is world competitive in the construction of high speed aluminium vessels. However, most foreign builders of very large steel naval vessels would be able to produce the vessels within a similar or better cost and time delivery envelope than Australian industry could reasonably be expected to offer. It should be noted that although Austal specialises in lightweight, fast speed aluminium vessels, it would compete for resources and skills should Australia opt to build very large steel naval ships in-country.

On July 01, 2011 the U.S. Navy exercised contract options funding the construction of the sixth and seventh Joint High Speed Vessel (JHSV), as part of a ten-vessel program potentially worth over US$1.6 billion. The construction contract for both vessels is valued at approximately US$313 million. Austal Chief Executive Officer, Andrew Bellamy, noted that this contract demonstrates the U.S. Navys confidence in Austal as a leading defence prime contractor. With options remaining for a further three vessels, the JHSV program is expected to deliver a predictable revenue stream of AUD$330 million per annum from 2012 to 2015, which is approximately 60 per cent of Austals historical revenue.

Austal is also currently building a second Independence-variant 127-meter Littoral Combat Ship (LCS) for the U.S. Navy, Coronado (LCS 4), which is scheduled for launch in September 2011. As prime contractor, Austal recently received a U.S. Navy contract for construction of up to an additional 10 Littoral Combat Ships, including Jackson (LCS 6) and Montgomery (LCS 8), to be appropriated in the following five years, with a total value in excess of $3.5 billion. Once commissioned, these 10 vessels will join the Austal-built USS Independence (LCS 2) which was commissioned in January 2010.



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Page last modified: 28-08-2019 18:56:20 ZULU