Australian defense shipbuilder Austal Ltd. is studying a third facility in the Philippines that will serve as a military vessel assembly plant with an investment of P1 billion to P1.5 billion.
Austal chief executive David Singleton said there were plans for a third facility possibly by 2020 as the global demand for naval vessels increased in the past year.
“What we would like to do is start the production line with work for the Philippine Navy and look for exports to other countries from the Philippines. We build military ships in Australia and export them as well. We’re more for the exports to other countries,” Singleton said.
He said the contract with the Philippine Coastguard for the procurement of offshore patrol vessels would be a good jumpstart for the facility, while building the capacity to develop more military vessels.
The company announced earlier the Defense Department’s proposal to procure six OPVs that would cost the government P30 billion.
The procurement would not go through the usual bidding process and would instead be pursued under a government-to-government agreement to ensure that the Philippines would get the boats if and when the need arises.
The first boat is expected to be delivered two years after the agreement is signed.
“There is a tender underwire at the moment and we’re responding to that tender. Maybe there are some discussions between governments, but we’re no party to those discussions,” Singleton said.
The OPVs would be the Philippines’ first military vessel order. Austal previously fulfilled orders for two ferries by 2Go Group Inc.
Singleton said the planned assembly plant in its facility in Balamban, Cebu would have the capability to build small and medium-sized seacrafts of roughly 100 meters in length like corvettes, high-speed small and medium aluminum vessels and OPVs.
The Cebu facility, operated by Austal Philippines, is the second single biggest facility of Austal after the one in the US.
The US facility has an annual production capacity of $1 billion worth of vessels, while the two existing facilities in the Philippines have a combined output of $150 million which in unit terms could be just one big ship or three small to medium-sized vessels.
The shipyard in Australia is smaller with a capacity of $100 million but is bigger than the Vietnam and China plants.
Singleton said Austal Philippines would push for the construction of the third facility with or without the contract with the Philippine Coastguard.
The mother shipyard is building more military vessels for the US which comprise about 75 percent of its total military defense vessel output.
“We build $1 billion for the US and another $1 billion in the rest of the other organization.
About 75 percent of our production is [for the] military. Sometimes the ratio changes, but that 75 percent is dominated by the US,” Singleton said.