Daily Management Review

Naval Group deploys a fearsome international strategy


​French shipyard Naval Group, formerly known as DCNS, is getting ready to make a killing on the international market with its new Barracuda submarine. With fierce competition on a small market, Naval group has designed a new international strategy, and it has little to do with the ship itself.

Scorpene class submarine Kalvari undertook it's first torpedo firing on 26 May 2017
Scorpene class submarine Kalvari undertook it's first torpedo firing on 26 May 2017
With a centennial submarine strategy which was merely interrupted for a few years during the German invasion, French expertise is not limited to its technology. In fact, although it belongs on the global top rank, French submarine technology can be certainly compared with the United States. Where the French will likely beat their competitors in recent years (they have already started) will be behind the scenes. Naval Group knows where the buying country’s fear is. Every procurement officer who has ever bought a ship knows that there is never any problem at the delivery. Well, almost never as Germany recently experienced. The problems always occur later, when it’s too late to go back. When the maintenance first is needed, or when repairs become necessary, are the technology and the know-how still available? What may sound obvious isn’t, and many armies have learned it the hard way. After the initial integration job is done, with the construction of the unit, the complex technological network of partnerships on which it is built can fall apart, which will effectively cripple the program. France has masterfully circumvented this problem with a thorough strategy, which places all the companies which partake in marine and submarine technology under State supervision and protection. As a result, none of the partners face industrial difficulties which could strain the partnership, as was shown by the recent French governmental intervention to relieve economic pressure from its defense market. “Macron signed the 2019-2025 military budget law on July 13 at Brienne House, just before the garden party held on the eve of the Bastille Day military parade on the Champs Elysées. This was a “military budget law of growth,” he said in a speech to the officers and personnel who would take part in the parade the next day. The spending would be at a level unseen for decades, hitting the defense spending target of 2 percent of gross domestic product by 2025, he added, and the move comes at a time when the domestic budget was under strain.”, Defense News Pierre Tran reported in July 2016.
Brazil gave, in 2008, a good example of the French strategy’s scope and efficiency. Eager to modernize their submarine fleet, Brazil also was aware that whichever partner they would choose to do so would need to stand fast for the length of the program (submarine programs can easily reach 50 years) and not bring partial solutions to global problems. Brazil’s territorial waters are huge and can harbor a variety of different, and changing, threats, and largely relies on its waters remaining open to uphold its economy. Unaware, as any military strategist is, of what the threats and needs would be 10 or 15 years down the road, Brazilian staff officers needed a partner who mastered all aspects of submarine construction: design, propulsion (both nuclear and conventional), pen design, armament, sonar technology (both active and passive). Vincent Groizeleau writes : “The Prosub programme calls for the construction, under a technology transfer programme, of four Scorpene-based diesel-electric submarines, dubbed type S-BR, and French assistance with the development of the non-nuclear portions of Brazil’s first nuclear-powered submarine (SN-BR). Naval Group is also helping with the design and delivery of equipment for the new shipyard and the naval base where maintenance will be performed.”. As a result of an all-inclusive offer, France was able to convince Brazil that it was the right choice.
The most recent success of Naval Group came with the Australian sale, with a complete replacement of Australia’s fleet, selling the brand-new Barracuda-class submarine, France’s latest nuclear sub (sold in its conventional version to the Australians). Janes reporter James Grevatt writes: “The Australian government has made publicly available the industrial engagement plan submitted by French shipbuilder Naval Group that supports the company’s programme to build 12 next-generation submarines for the Royal Australian Navy (RAN). Naval Group (then DCNS) was selected to build the submarines in 2016, proposing a conventionally powered derivative of its Barracuda nuclear attack submarine. In releasing the company’s Australian Industry Plan, Payne said the document formed part of its response to the competitive evaluation process through which it was selected as preferred contractor.”. Competition had been fierce for such a large deal (few tenders reach ten units), and France combined its reliable industrial strategy with a powerful sales tactic, hiring the best suited man to sell the idea, as reported by Reuters: “Crucially, in April 2015, DCNS hired Costello, who had earlier that year lost his job as chief of staff of Australia’s Defence Ministry in the wake of Johnston’s resignation. A former navy submariner who had also been the general manager for strategy at state-run Australian submarine firm ASC, Costello was ideally placed to lead a bid.”. Initially outrun by the Japanese, the French were able to overtake both the overconfident Japanese and the desperate Germans with their fearsome strategy. The next strategic step will be the Netherlands, where Defense minister Ank Bijleveld announced the replacement of its four Walrus-class submarines, to maintain its participation levels to NATO operations. In 2016, the Dutch had quasi-sunk the Russian carrier Admiral Kuznetsov by sneaking up on it, and will need new subs if they want to renew their cockiness (the French sub quasi-sank an American carrier - even better).
The submarine market is in turmoil, with new technologies such as AIP bringing conventional countries closer to nuclear capacities without having to jump the gap.  With global military spending remaining at solid levels, naval sales expected to remain high, providing the French with a large playground to try out their new ship.

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