The Daily Populous Tuesday August 5th, 2025 morning edition
Authored by abc.net.au and submitted by StealthCuttlefish

Japanese shipbuilder Mitsubishi Heavy Industries has won a fierce contest to build the Australian navy's new fleet of warships, beating a bid from German rival ThyssenKrupp Marine Systems.

Defence Minister Richard Marles announced this morning that cabinet had selected Japan's upgraded Mogami frigate over the German MEKO A-200.

The first three of the frigates are expected to be built in Japan, with the remaining eight to be built in Western Australia.

The initial contract for the first three vessels is worth $10 billion, although that money will also help provide the workforce, ship-building facilities and missiles the whole fleet will need.

It is not yet clear how much it will cost taxpayers to build the rest of the warships in Australia.

The government's decision is a major victory for Mitsubishi Heavy Industries (MHI) and for Japan, which has thrown substantial political resources into securing the bid.

Japan vows to give Australia first access to new Mogami warship Photo shows A graphic showing two warships next to each other. One is smaller. Tokyo is stepping up its campaign to win a lucrative Australian naval contract by pledging to give "priority" to warship exports over its own navy.

It is also a vote of confidence in MHI, which has never built warships overseas before.

Defence Minister Richard Marles said the frigates would replace Australia's ANZAC-class ships, the oldest surface combatant fleet the navy has been operating since the end of World War II.

"This does represent a very significant moment in the bilateral relationship between Australia and Japan," Mr Marles said.

"This is clearly the biggest defence industry agreement that will ever have been struck between Japan and Australia. In fact, it's really one of the biggest defence exports that Japan has ever engaged in."

Mr Marles said the first would come into service by the end of this decade, closing a gap that would have otherwise meant Australia would not receive a new surface combatant until 2034, when the first of the Hunter Class vessels would arrive.

Defence Minister Richard Marles said the announcement was a significant moment in the history of the Royal Australian Navy. (ABC News: Courtney Withers/File)

Close observers of the contest say that while Japan's bid was more expensive, the Mogami frigate boasts more firepower and requires a smaller crew.

The government insists that the Mogami frigate is actually substantially cheaper if you calculate its cost over its whole lifespan, with Defence Industry Minister Pat Conroy saying MHI has been a "clear winner" on "cost, capability and schedule".

Japan has also said that Australia could receive the first of the upgraded warships ahead of its own navy — which the ABC has been told helped to tip the contest in its favour.

Mr Conroy said the government was confident Japan would be able to deliver the first three warships within the next decade, saying Tokyo had already "allocated three production slots for Australia" in their shipbuilding schedule.

"So we've got great confidence. This was an intentional acquisition strategy of the Australian government to access an established production line and not change it," he said.

While the government insists it was making the decision on capability alone, Japan has leaned heavily on the blossoming strategic and defence relationship between the two countries as it lobbied for the contract.

The United States is also believed to have backed Japan's bid, and Mr Conroy said this morning the decision to select MHI would "reassure our allies, deter our adversaries and make Australia safer".

Japan's prime minister welcomed the decision on social media, promising the two countries would "work together — across both government and industry — to move toward the conclusion of the contract".

The government and Mitsubishi Heavy Industries will now begin negotiations on the contract, and will aim to finalise it this year.