Submarine Proliferation

Italy Export Behavior

Capabilities | Import | Export

Sauro-class Submarine
Source: "La Tecnologia," Italian Navy Web Site, http://www.marina.difesa.it/sommergibili/tecno.htm.

Fincantieri:

The Italian shipyard Fincantieri offers four submarines for export:

Longobardo-class: diesel-electric submarines designed and produced for the Italian Navy
S 1000 concept vessel: a diesel-electric submarine using AIP technology under development in cooperation with Russia's Rubin Naval Design Bureau for the Italian Navy[18]
S 1300 (Sauro-class): diesel-electric submarines, also designed and produced for the Italian Navy
S 1600 concept vessel: a larger diesel-electric submarine initially designed for the Italian Navy [1,2,3]

In addition, Fincantieri produces small submarines of less than 700 tons displacement. The versions of both of these vessels and the S 1300-class submarines offered for export are described as being equipped with an air-independent propulsion (AIP) system.[3,4] However, the one customer for these boats to date, the Italian Navy, does not yet have any boats equipped with AIP. Its first AIP boats will be the Type 212A boats built at Fincantieri (the lead boat was completed in June 2005, the second of class is scheduled for completion in 2006). According to some reports, the German AIP system, which uses a silent hydrogen/oxygen PEM (Polymer Electrolyte Membrane) fuel cell system, will allow the 212 to remain submerged for two weeks, while others suggest the boats can remain underwater for over a month at a time.[5,6] Should AIP indeed be offered for export, it is likely to be a foreign design, as no Italian research in this area has been reported.

Fincantieri has designed and produced all previous submarines of the Italian Navy with the exception of the new Type 212A, which was designed by HDW. However, it has not succeeded in its recent efforts at exporting submarines. Fincantieri entered a bid based on the Sauro-class to replace Australia's Oberon-class vessels, but later withdrew its offer.[7] Similarly, the shipyard was an unsuccessful contender for the South African and Portuguese Agosta- and Daphne-class replacement programs.[8,9] It has also been reported that eight Italian submarines have been offered to the Taiwanese Navy, which may have been a combination of decommissioned and about to be decommissioned Sauro- and older Toti-class units.[10]

Italy's decision to join Germany's Type 212A program in 1995, instead of further developing a domestic design, clearly indicates the impact of rising developmental costs on a single country when domestic demand is low and it cannot resort to export sales to reach economies of scale. Similar to the Viking submarine concept, which was jointly developed by Sweden, Denmark, and Norway initially as well, Italy opted for cooperation with Germany, enabling a timely procurement that corresponded to the fiscal priorities of the Italian Navy.[11,12]

Fincantieri's future as an independent submarine producer remains uncertain. As of April 2005, Fincantieri was mostly government-owned via Fintecna, with a 4.7 percent stake held by private entities. In 2002-2003, efforts were made to increase the share of private ownership, and in early 2004 the Italian government proposed combining Fincantieri with Italian defense conglomerate Finmeccanica. But that deal was abandoned in February 2005. However, in April 2005 Fincantieri Managing Director Giuseppe Bono suggested that the company was considering a public offering.[13] An Italian trade union official, on the other hand, responded by saying that there were no Italian individuals with "the money, desire and possibility to manage and develop a company like Fincantieri."[14] It appears unlikely that the Italian government would consider a foreign owner for the shipbuilder.

In 2002, Fincantieri entered a joint venture with HDW to market small submarines. With the agreement, the shipyard also became HDW's preferred partner to cover contract overloads concerning boats with more than 1,000 ton displacement.[15] However, HDW itself is facing economic problems. A surge in submarine contracts that could not be met through its own production seems unlikely. Unsurprisingly, the agreement is now considered to be inactive. While Fincantieri itself has been attentive to industry developments, Italian authorities have not indicated their position or interest in the company becoming part of a larger European consortium yet.[16]

Unless Italy is willing to invest significant funds into indigenous design capabilities and production, which would have to be followed by either a larger Italian submarine flotilla or substantial export success, Fincantieri's capacities in this area are likely to deteriorate. Permanent training is a prerequisite to sustaining the knowledge base of specialized personnel; a minimum workload is thus crucial to remaining at the forefront of technology and ensuring the shipyard's future.[17]

In 2005, Fincantieri entered a joint venture with Russia's Rubin Naval Design Bureau to develop a new diesel-electric submarine, the S 1000, using AIP technology. The Russian partner has indicated it will make available certain design aspects of the Amur class.[18] India was the first country to receive a briefing on the new submarine and is reportedly considering an Italian offer to build six boats for $3.5 billion as part of India's 30-year submarine plan, which calls for a diversified submarine fleet (India recently ordered six Scorpène boats from France). [19]

Sources:
[1] "S 1600," Fincantieri Web Site, http://www.fincantieri.it.
[2] "Longobardo," Fincantieri Web Site, http://www.fincantieri.it.
[3] "S 1300," Fincantieri Web Site, http://www.fincantieri.it.
[4] "S 600," Fincantieri Web Site, http://www.fincantieri.it.
[5] Don Walsh, "The AIP Alternative: Air-Independent Propulsion: An Idea Whose Time Has Come?" Navy League of the United States Website, http://www.navyleague.org/seapower/aip_alternative.htm.
[6] Edward C. Whitman, "AIR-INDEPENDENT PROPULSION: AIP Technology Creates a New Undersea Threat," U.S. Navy Office of Information Website, http://www.chinfo.navy.mil/navpalib/cno/n87/usw/issue_13/propulsion.htm.
[7] Derek Wollner, "Procuring change: how Kockums was selected for the Collins class submarine," Research paper No. 3, 2001-2002, Information and Research Services, Department of the Parliamentary Library Web Site, http://www.aph.gov.au/library/pubs/rp/2001-02/02RP04.pdf, pp. 6-8.
[8] Norman Chandler, The Star, 12 August 1998; in "Country considers purchase of German submarines," FBIS Document FTS19980812000867.
[9] "Government has five tenders for the purchase of submarines," Diario de Noticias, 3 June 1998; in "Portuguese Defense Ministry opens five submarine tenders," FBIS Document FTS19980603000306.
[10] Tiffany Wu, "Taiwan eyes submarines, anti-missile system," Reuters News Agency Web Site, http://www.reuters.com, 30 August 2003.
[11] Interview with Captain Ermengildo Ugazzi, Commander Submarine Flotilla, "Submarines today: flotilla commanders comment," Naval Forces, 1999, Vol. 20, No. 6, pp. 40-46; in ProQuest Information and Learning Company, http://proquest.umi.com/pqdweb.
[12] Interview with Dirk Rathjens, HDW Board of Directors Member, by Manfred Sadlowski, "HDW -- a shipyard armed for the future," Naval Forces, 1999, Vol. 20, No. 1, pp. 60-66; in ProQuest Information and Learning Company, http://proquest.umi.com/pqdweb.
[13] John McLaughlin, "Bullish Fincantieri mulls public listing," Lloyd's List, April 12, 2005; in Lexis-Nexis Academic Universe, http://www.lexis-nexis.com.
[14] "Italy Fincantieri Privatization Not Possible," ANSA English Corporate Service, April 22, 2005; in Lexis-Nexis Academic Universe, http://www.lexis-nexis.com.
[15] "HDW und Fincantieri unterzeichnen Abkommen über Zusammenarbeit," Pressearchiv 2002, 29 April 2002, HDW Web Site, http://www.hdw.de.
[16] Giovanni Paci, "Twenty thousand disputes under the sea," Corriere della Sera, 15 September 2003; in "Report on German project for major European submarine-shipbuilding sub," FBIS Document EUP20030915000061.
[17] Klaus Jacobsen, "A new formula: made in Germany & made in Sweden," Naval Forces, 1999, Vol. 20, No. 4, pp. 6; in ProQuest Information and Learning Company, http://proquest.umi.com/pqdweb.
[18] "Russia, Italy Developing Joint Conventional Submarine," ITAR-TASS, December 16, 2005; FBIS Document CEP20051216027020.
[19] Vivek Raghuvanshi, "India Considers New Italian-Russian Submarine," DefenseNews.com, February 20, 2006; accessed at www.defensenews.com.

This material is produced independently for NTI by the James Martin Center for Nonproliferation Studies at the Monterey Institute of International Studies and does not necessarily reflect the opinions of and has not been independently verified by NTI or its directors, officers, employees, agents. Copyright © 2007 by MIIS.