The Australian defence manufacturing industry is an important part of the country’s economy, generating billions of dollars in revenue and supporting thousands of jobs. After much anticipation, the latest Defence Strategic Review has finally been released. It has been made clear that the defence strategic landscape has changed, and that Australian defence industry needs to adapt quickly.
With a re-focus from a 10 year warning time, to prioritised matters in the 2023-2025 period, there is no time to waste in executing the recommendations that have been proposed by the DSR and supported by Government.
As an example, the Land 400 Phase 3 Land Combat Vehicle System (Infantry Fighting Vehicle) project which has been in limbo awaiting the release of the DSR. Tenders for that contract were originally called for back in 2018, and lead tenderers provided their Final Offers in October 2021, industry is now keen to learn when Government will finally award the contract.
There is no reason to delay further. The Australian Manufacturing industry, including Corvus Technology Solutions, stands ready and eager to execute the delivery of defence systems. The recommended reduction of units for Land 400 Phase 3 from 450 to 129 Infantry Fighting Vehicles is significant for sure, and per-unit costs would benefit from a higher number of units, but an extended re-quoting from lead tenderers will only delay defence readiness further.
It is not just lead tenderers left in limbo but the entire supply chain, which will need to tool-up to capitalise on the opportunity presented by such projects. It is also giving the edge to our competitors in the region, who are embracing the fourth industrial revolution (Industry 4.0) and leveraging technological advancements to improve the quality of their products and deliver them at lower costs.
At the same time, the market for defence equipment is changing, with a shift towards more complex, integrated systems that require advanced manufacturing capabilities. Innovation is at the forefront of Industry 4.0 and will be key for Australia to develop advanced products to meet the defence industry’s changing needs and be competitive in the evolving global landscape.
At Corvus, we reinvest roughly 10 per cent of our annual turnover into research and development (R&D) to ensure we are constantly evolving to meet the current and future needs of our customers. At the heart of our R&D investment is smart automation and robotics, which is helping not only us, but our customers improve efficiency, reduce costs and minimise waste.
Government can play a leading role in fostering industry collaboration, which will be essential to improving the competitiveness of Australia’s defence manufacturing industry. Creating a more supportive regulatory and policy environment to increase collaboration could help streamline supply chains, reduce duplication of effort, and improve the overall efficiency of the sector. Such supportive polices include funding research and development initiatives and creating a more streamlined procurement process that encourages collaboration and innovation.
However, separate to the macro regulatory, policy and investment support required, is simply maintaining the momentum created by the DSR so that Australian Industry can get-on and ‘do the work’.
Let’s avoid stifling business confidence and preventing companies from committing to substantial investment that could help support and create jobs in the sector.
Let’s move forward with the projects that support the recommendations made by the DSR, and agreed to by Government.
Let’s get on and allow Australian Industry to deliver the capability that we agree that we need.
The DSR says we need to adapt quickly. Defence Industry is tooled-up and ready to start.
Nick Williams is the general manager for Corvus Technology Solutions.