HII wins contract for Australian submarine supplier pilot program

Newport News-based Huntington Ingalls Industries has been awarded a contract from the Australian government to develop and run the new Australian Submarine Supplier Qualification (AUSSQ) pilot program that will build a submarine supply chain between the United States and Australia over the next two years, HII announced March 11.

The contract’s initial value is about $6 million in U.S. dollars, a small amount for HII, which is the nation’s largest military shipbuilder and runs the state’s biggest industrial employer, Newport News Shipbuilding. However, the pilot program is “a significant milestone in building a resilient and globally integrated supply chain for nuclear-powered submarines,” HII President and CEO Chris Kastner said in a statement.

AUSSQ is part of AUKUS, a 2021 agreement between the United Kingdom, the United States and Australia, in which the U.S. and the U.K. will share nuclear propulsion technology with Australia, and the Royal Australian Navy will acquire at least eight nuclear-powered submarines, including three to five Virginia-class subs, in the 2030s.

Meanwhile, Australian shipbuilders are making plans to come to Virginia for training to become HII suppliers. HII’s Canberra, Australia, location will host the AUSSQ pilot program, preparing Australian suppliers to eventually qualify for contracts in the U.S. submarine industrial base.

Announced by the Australian government’s submarine agency on March 5, AUSSQ “will use a B2B model, enabling HII Australia to work directly with Australian businesses to qualify both the businesses and their products, and subsequently assist them to tender for supply into the US programs,” according to the AUKUS submarine industry strategy.

Until recently, Australia had basically no nuclear industry, as a signatory to the international Nuclear Nonproliferation Treaty, and its aging submarine fleet is in need of replacement with nuclear-powered submarines. The U.S. and the U.K. have shared nuclear propulsion technology for more than 60 years now, and AUKUS includes Australia in that relationship.

“An Australian submarine industrial base capable of building and sustaining a persistent, potent and sovereign multiclass submarine capability is vital to the defense of Australia, and this pilot initiative with HII Australia is another important step to this being achieved,” Richard Marles, deputy prime minister of Australia and also the nation’s defense minister, said in a statement.

According to this week’s announcement, HII will provide technical guidance and implement best practices to provide Australian suppliers with precise specifications required to produce nuclear submarine components, similar to its efforts in the United States, where the company spends approximately $1 billion with more than 2,000 contractors annually, including about $500 million going to small businesses.

“HII has a long history of working with suppliers to ensure they meet the highest standards in safety, security and performance,” Kastner said. “We welcome Australian partners to help build out this critical nuclear shipbuilding capability and ensure the long-term success of AUKUS.”

In January, HII closed on its purchase of a metal fabrication manufacturing facility in South Carolina, which is operating as part of NNS.