Frigate bidders to raise price

Press, 3 June 1989, Page 38

Frigate bidders to raise price

NZPA Sydney The two consortia bidding for the Anzac shipbuilding project are haggling behind the scenes to try and increase the price guidelines set by the Australian Government, according to Defence officials in Canberra. New South Wales-based Australian Warships. Systems (A.W.S.) and Vic-toria-based Australian Marine Engineering Corporation Consolidated (Amecon) have to lodge their "best and final” offers by June 16 to build eight frigates for the Royal Australian Navy and up to four for the Royal New Zealand Navy. The Prime Minister, Mr Lange, said New Zealand’s involvement in the project depended on cost and the Australian Defence Department seemed adamant that the winning

tender would have to be within the Australian Government’s guidelines. "Of course the tenderers will try to up it,” one Defence source, who declined to be named, told NZPA. “A.W.S. has been trying to stick us into a full-bore N.A.T.O. ship and Amecon has been playing politics with its multi-yard building plans. "But we don’t want to pay the extra cost of that and we don’t need a N.A.T.O. ship. "It is a buyers’ market for warships at the moment," the service said. The Australian Government set a $4.4 billion — in April, 1988, dollar terms — for its eight ships and instructed the tenderers the baseline configuration of each ship must not exceed an average $332 million.

The managing director very competitive tender of Ameon, Dr John White, and that the Comsaid he could not com- monwealth (Government) ment on the price his has given us some exconsortium was offering tremely hard targets,” Mr because of the commer- Hoy said. cial competition. “They are really driv“The Government has ing an extraordinarily indicated what its ex- hard bargain at the pected budget ceiling is moment.” and we are doing our Mr Hoy announced yesdarndest to provide a pro- terday that in its best and posal for doing the project final offer, A.W.S. gave’ within their budgetary the options of building all constraints,” Dr White 12 ships in Newcastle or said. providing "lead yard ser“But what you can’t do, vices” to build five at you can’t do.” Amecon’s Williamstown A.W.S. has reportedly Dockyard, in Melbourne, had more difficulty than He said, however, the Amecon keeping within second option would not the Government’s price affect the amount of work guidelines for its M Class A.W.S. planned to put into frigate, designed by Royal New Zealand — about 17 Schelde of Holland, but per cent or $BBO million the consortium chairman, of the Australasian conMr Roly Hoy, was also tent. reluctant to comment on The A.W.S. tender his bid price for commer- offered 70 per cent Auscial reasons. tralia-New Zealand con“We recognise this is a tent.