Angry French defense contractor demands compensation over Okos deal | Okos

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The angry head of French defense conglomerate Naval Group has warned that Australia has signed an empty promise by agreeing to a deal for US nuclear-powered submarines that has no clear delivery date or technology transfer agreement.

Pierre-Eric Baumelier also said his company would seek compensation for Australia’s cancellation of a €56bn (£48bn) contract to buy 12 new attack-class submarines, which he described as a purely political decision that came without warning.

His comments to Le Figaro were the latest allegations that Australia’s decision to replace the French contract with Aukus’ deal with the UK and US was political rather than defense-based. Australia explained that the cancellation of the contract followed a new assessment of the security threat posed by China.

The only tangible point in the proposed new contract, Baumelier said, is the decision to acquire nuclear-powered boats. When, how, with which partners and any technology transfer? nobody knows. Australia, on the other hand, knows what to lose and what we have committed to building.”

He added: “At Naval Group…we had no warning sign or the slightest bit of information that we had become a Plan B in favor of Plan A with the US and UK.

There is no doubt that discussions between these two countries and Australia took place in a very small circle at the highest political level for several months.

“This decision was announced to us without any notice, and with incredible brutality.”

The submarine contract, Australia’s largest defense acquisition, has been plagued by delays, cost explosions, and disagreements over local industry involvement.

But the French Ministry of Defense said this week that Australian military officials sent a message that they were “extremely satisfied” with the French submarines just hours before announcing the cancellation of the project.

The Australian government played down the message to Naval Group, but Pommellet dismissed allegations that Canberra had given a clear warning that the contract carried risks.

“The lights were all green. On the morning of September 15, we received a letter informing us officially that the Australian Government had accepted our offer as well as the technical options that would have allowed the start of a new phase of the programme, called the ‘basic design’ of submarines. All was well to finalize the negotiations and sign the submarines. This new contract quickly.”

He said the compensation claim would be submitted to the Australian government in a few weeks, adding, “As a manufacturer, we will assert all of our rights.”

In the interview, he has consistently sought to defend his company’s reputation, saying the cost increases are due to the Australian government’s reassessment of its security needs, including increasing its requirements from eight to 12 submarines.

Its technical requirements have also evolved, particularly in cybersecurity, a topic that was less relevant in 2016, when the contract was first signed.

He insisted that Naval Group was the only company in the world with the knowledge to produce both conventional and nuclear submarines, meaning his company should have been allowed to bid if Australia decided to rewrite contract specifications.

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