Tasmanian manufacturing jobs to be created in Spirit shipbuilding bid

Posted: 22nd Aug

Tasmania would get a big share of the manufacturing jobs and spending from building new Spirit of Tasmania ferries under a bold bid from shipbuilding giant Austal.

Western Australian-based Austal - the nation's biggest defence exporter - proposes to build two new monohull vessels to replace the current Spirits.

It would construct the hulls in Southeast Asia, float them to Australia and do the fit-outs in Australia, aiming to involve as many Tasmanian businesses as possible.

"We absolutely recognise that this is a program being paid for by the Tasmanian government, so the first objective in terms of employment is to create as much employment in Tasmania as we possibly can," Austal chief executive David Singleton said.

"The reason the Tasmanian government is doing what they're doing, which is to look at an Australian solution, is to create income and employment for the Tasmanian economy."

Mr Singleton said the project could lead to thousands of direct and indirect jobs over three to four years and would introduce more Tasmanian manufacturers to the defence supply chain.

If its proposal was accepted, Austal would look for ways to maximise employment in Tasmania, he said.

He said it would aim to get as much of the "sophisticated, high grade" work - outfitting, engineering and commissioning - as possible done in Australia.

"We think that about half the labour content of this can be done in Australia," he said.


The proposal follows the state government's shock decision to dump a planned $850 million build in Finland.

The government said it wanted to maximise Tasmanian and Australian jobs by doing some or all of the build in Australia, and established a taskforce to identify local procurement, purchasing and manufacturing options for the new vessels

That was despite Spirit operator TT-Line saying in 2017 Australia did not have the capability of building the types of ships it required.

Mr Singleton said an Australian-led build would involve many small to medium-sized (SME) Australian businesses and potentially create thousands of jobs.

"By bringing these vessels here, what will happen is, naturally, we will look to our normal supply base, our supply chain, which is firmly rooted here in Australia, as being suppliers for that," he said.

"These are the opportunities that prime contracting out of Australia presents us (to) get the huge SME base we have in this country involved."

He said Austal's supply chain already included hundreds of Tasmanian and mainland companies, including companies it had helped export to the US.

ASX-listed Austal employs 6700 people in shipbuilding around the world.

It says it is the only non-US company ever to have prime contracted ships for the US Navy.

Mr Singleton said Austal intended to present the taskforce a solution that delivered certainty and the best value for Tasmanian taxpayers, freight customers and passengers.


"This absolutely is a time to be bold," Mr Singleton said.

"The economic, political environment we're in today requires Australians to be bold in what we are doing.

"We've seen that rhetoric from the federal government, we've obviously seen that rhetoric from the Tasmanian government now, with this decision, so I think it's time now for industry to say: "If you governments are being bold, if you're prepared to take these sorts of decisions and don't take the easy route, take the more difficult route and the more innovative route, it's time for industry to step up and deliver it."

Mr Singleton said the model could be used for many other large steel vessels - naval, civilian and commercial - which Australia would require over the next two decades.

"Austal believes that in this current environment it is time to give Australian manufacturing a shot in the arm and create more export opportunities for our country." he said.

"Australia is the undoubted world leader in the design and construction of high-speed aluminium ships and as a nation we have embarked on our biggest investment in world class ships for the Royal Australian Navy to be built in South and Western Australia.

"Australia is currently unable to construct large steel monohulls and the TT-Line vessel replacement process offers an opportunity to change that.

"Replacement of the TT-Line ROPAX ferries also represents a once in a generation opportunity for Tasmanian manufacturing to establish itself within Australia's national shipbuilding enterprise."


The state government has not ruled out catamarans as possibilities to replace the monohull Spirits.

There is some public support for Tasmanian firm Incat to provide catamarans, despite the previous cat service being dubbed the Spewcat because of the challenging Bass Strait conditions.

Mr Singleton said Austal had assessed sea conditions on the crossing.

"Our experts in vessel motions and passenger comfort analysis concluded a large traditional steel passenger/vehicle monohull, as originally sought by TT-Line, is, indeed, the only viable solution for this uniquely challenging route," he said.

Austal said the current model of two monohull steel vessels was very successful and there was no clear reason to change it.

Mr Singleton said he expected Incat would get opportunities if the Austal proposal was accepted.

"I personally see Incat as somebody who will benefit significantly ...," he said.

Austal said its proposal would bring manufacturing "home" to Tasmania and the nation.

Source: The Examiner - https://www.examiner.com.au/story/6889521/tasmanian-jobs-galore-in-bold-new-spirit-replacement-bid/