Austal wins sixth US Navy contract for towage vessels

Perth international shipbuilder Austal has been awarded a $115 million fixed-price incentive contract option from the United States Navy for the construction of an additional Navajo-class Towing, Salvage, and Rescue Ship (TATS 15, pictured).

Austal USA is now under contract for five steel-hulled T-ATS in a programme that could be worth up to US$3.2 billion, building on its most profitable business – the construction of aluminium multi-hulled Littoral Combat Ships and Expeditionary Fast Transport ships for the USN.

It has also been awarded a contract for up to 11 steel Offshore Patrol Cutters for the United States Coast Guard, worth up to US$3.3 billion.

The US government subsidised Austal to enter steel shipbuilding, drawing attention to the company which is now considered by many to be examining merger and acquisition activity, or even becoming a takeover target by a US company.

Given the low level of the Australian dollar against a soaring US$, Austal – one of a tiny number of large Australian-owned defence companies – would be a cheap acquisition for a US defence major.

Austal Limited Chief Executive Officer Paddy Gregg said the contract award again highlighte Austal USA’s growing steel shipbuilding capability, following the start of construction on T-ATS 11 and 12, and a 211-metre Auxiliary Floating Dock Medium, for the USN.

Gregg said: “Austal USA’s steel shipbuilding capabilities and capacity continues to impress, with three steel vessels now underway in Mobile, Alabama; in addition to the multiple aluminium vessels and component projects also under construction.

“The Austal USA team are also delivering submarine modules for the Virginia-class submarines and aircraft elevators for the Gerald R. Ford-class aircraft carriers, so they are without doubt making a significant contribution to the United States’ defence industrial base.”

T-ATS is an ocean-going tug, salvage, and rescue ship designed to support the United States Navy’s fleet operations, with a multi-mission common hull platform capable of towing heavy ships.

The ships can support a variety of missions, including oil spill response, humanitarian assistance, search and rescue and surveillance.

With construction due to commence on T-ATS 13 and 14 in the second half of CY2023, T-ATS 15 is scheduled to commence construction in the first half of CY2024, with delivery planned in late 2027.

Austal USA will utilise its lean manufacturing principles, modular construction, and moving assembly lines which are housed under the company’s enclosed steel production facility in Mobile, Alabama.

Further reading:
Nothing going on here – Austal shares surge
Browse @AuManufacturing’s coverage of Austal here.

Editor’s note: This story has been modified following an announcement from Austal to correct the value of the latest contract to $115 million.

Picture: Austal