As Australia, the United Kingdom and the United States established “AUKUS”, a foundation for an Indo-Pacific version of the North Atlantic Treaty Organization, or NATO, Australia also began the process of ripping up a massive $65 billion contract with France for 12 “Shortfin” Barracuda Class submarines.
Submarines are just a single part of what will be a far wider collaboration. As a defense alliance, the “Three Amigos” will also begin working together almost immediately on other undersea capabilities, new quantum technologies, cyber, and applied artificial intelligence, pursuing “integration of security and defense-related science, technology, and industrial bases, and supply chains.”
But the first—and most disruptive—initiative revealed by the “Three Amigos” working group is the surprise transfer of nuclear submarine technology to support the fabrication of nuclear submarines in Australia. The ruthless move derailed Australia’s five-year old, $65 billion deal with France for 12 submarines, conventionally-powered variants of France’s Barracuda Class nuclear-powered attack submarines. It’s a heck of a blow to France’s strategic, national security and economic fortunes.
Pouring salt on the wounds, the “Three Amigos” announcement came on the eve of celebrations marking the 240th anniversary of the Battle of the Capes, where a French fleet, allied with Washington, defeated the British Navy, ensuring America’s victory in the Revolutionary War.
In effect, France—along with many, many others—misread the geopolitical tea leaves.
Change happens fast. In the space of just five years, China’s appetite for regional imperialism forced a complete revision of Australia’s strategic position. In 2016, Australia’s lash-up with France for 12 conventional submarines was seen as an innovative opportunity for France and Australia to position themselves as a relatively well-armed, albeit inoffensive and nominally non-aligned set of Pacific “balancers,” buffering growing friction between China and America. If regional tension increased, Australia’s emerging military-industrial links with Paris was a potential route to ballistic missiles and, if the threat was existential enough, nuclear weapons.
China had other ideas. Since 2016, China has put a lot of energy into shrinking Australia down to an impotent Chinese suzerainty. To that end, China directly tinkered with Australian politics, funding pro-China news outlets, thinkers, and politicians. It interfered in Australia’s regional affairs, opened a vicious trade dispute, and presented Australia with a humiliating and sovereignty-eroding set of terms to restore favorable relations.
In the end, China’s existential threat made Australia and France’s experiment in inoffensive deterrence—replicating the collaborative-but-unaligned approach of Sweden or Finland in Europe—untenable. France underestimated how China’s naked military ambition, chronic disregard for international order, and barely concealed aspirations to control the deep Pacific and Antarctica pushed Australia to make tough decisions about the future.
With survival at stake, Australia’s deal to build 12 conventional submarines—conventionally-powered variants of France’s front-line nuclear-powered attack submarine—began to look puny, particularly as China is showing signs of expanding their small nuclear submarine fleet. Put another way, Australia was set to pay about half of what America is paying to procure a fleet of massive, high-tech Columbia Class ballistic missile submarines. Ever since the late 1950’s, Australia has maintained it would only consider nuclear submarines if nuclear submarines could be acquired for less than twice the cost of conventional submarines—a price point where longer-endurance nuclear vessels began to offer a similar number of effective days on patrol as a larger fleet of conventional subs.
France was learning that Australia’s vicious political media is notoriously unkind to hiccups in defense procurement, but if failed to realize that the performance hiccups were becoming an existential threat to Australia’s current government. By early last year, the twelve-sub deal was behind schedule, over-budget, employing fewer Australians than expected—and no viable solution was in sight. With the submarines not expected to start entering service by 2035, and with rumors floating about that the sub’s technical problems were deeper than publicly acknowledged, it was politically untenable for Australia to pay nuclear prices for conventional submarines that would, strategically, be a poor fit.
As Australia began to explore nuclear-powered alternatives, Australian leaders also began to understand that France was unable to support Australia’s emerging preference for nuclear power without a lot more cash. Non-alignment has a cost, and France’s vertically integrated family of undersea systems, coupled with high-maintenance naval reactors and more frequent refueling requirements made any nuclear solution with France a far more pricey, time-consuming, and controversial challenge than Australia was prepared to handle.
France didn’t quite realize that conditions had also changed for the United Kingdom. When Australia selected France as submarine supplier in April 2016, Brexit was just a referendum, unlikely to pass. But now that Brexit was a reality, the United Kingdom was juggling expanded international expectations with desperate fiscal realities. And with two nuclear submarine production lines open and several submarines on the ways, France may have underestimated the lengths England would go to preserve their submarine industrial base.
France also did not realize that America’s position has also changed, but, in that, they’re not alone. Even domestic observers are unaware that America wants partners to pick a side on China. Increasingly desperate for advanced Pacific bases with committed partners, few also realize that the U.S. has become very interested in exploring politically painless ways to shed legacy “Cold War” platforms that may, over the next few years, offer the first steps towards Australia’s indigenous nuclear-powered submarine fleet.