On Tuesday, August 5, 2025, Australian company Austal Limited announced that it had concluded negotiations on a 15-year SSA (Strategic Shipbuilding Agreement) with the Government of the Commonwealth of Australia for the construction of landing craft: 18 medium Landing Craft Medium and eight heavy Landing Craft Heavy under the Land 8710 program for the Australian Army. The construction will be carried out by the newly established special-purpose vehicle division, Austal Defence Shipbuilding Australia, at the Henderson shipyard in Western Australia.
Image: Austal Limited
Separate implementation contracts are planned to be signed in the near future. Austal Defence Shipbuilding Australia was established on November 23, 2023, after winning the tender, to carry out a contract—together with Birdon—for the delivery of medium landing craft, then designated LMV-M (Littoral Manoeuvre Vessel-Medium), for the Australian Army, where they will replace the currently used LCM8 (Landing Craft Mechanised Mk 8) at a ratio of 18 to 15 units, with deliveries starting in 2026.
Austal Limited CEO Paddy Gregg said:
“The government’s approval of the SSA is a defining moment for Austal. It will establish Austal Defence Australia as the Commonwealth of Australia’s strategic shipbuilder for Tier 2 vessels in Western Australia and reflects both Austal’s excellent defence shipbuilding record and the capabilities that Austal possesses to help the Australian Government to achieve its defence objectives.”
“The Commonwealth seeks to ensure Australia’s Defence procurement possesses sovereignty and greater certainty and resilience across the naval ship supply chain in an increasingly complex strategic environment and in alignment with the Commonwealth’s continuous naval shipbuilding policies. Through the SSA, Austal is committed to helping the CoA meet these objectives while establishing Austal Defence Australia as the CoA’s shipbuilder of choice in WA.”
Although the details of the contracts for the Landing Craft Medium and the heavy Landing Craft Heavy are still being finalized, Austal anticipates that Austal Defence Australia will generate significant revenue from the Land 8710 program. The medium craft are to be delivered within eight years of the signing of the implementation contract. The schedule for the heavy craft deliveries is still being determined, but the project is expected to be considerably larger. The contracts will provide for design, construction, and full life-cycle support.
“Utilising our decades of experience, Austal can contribute significant expertise to Australia’s sovereign shipbuilding base to reduce costs and improve the performance of vessels for the Australian men and women who work tirelessly to protect our shores,” Mr Gregg said.
It is expected that the contracts for the delivery of the medium landing craft will be finalized in the first quarter of fiscal year 2026, covering the construction of 18 units worth between 1 billion and 1.3 billion AUD. Delivery of the last unit is scheduled for 2032.
Depending on the outcome of the contract negotiations, the delivery of eight LST100 Landing Craft Heavy units, designed by Damen and to be built by Austal, announced by the government in November 2024, is planned. The implementation contract is expected to be awarded by the end of 2025.
As prime contractor, Austal Defence Australia will ultimately be responsible for all aspects of design and integration, construction, installation, testing, delivery, and acceptance of all 26 landing craft of both types, while ensuring that the projects are carried out cost-effectively, with progressive cost reductions and process improvements implemented throughout the build.
The special-purpose company Austal Defence Australia will draw on Austal Limited’s resources to meet the needs of the Australian government. However, the parent company and its subsidiaries will continue to conduct other activities in Australia, Asia, and the United States. Austal Defence Australia will employ its personnel, mainly transferred from existing Austal Group entities or recruited as needed.
@Austal Limited (ASX: $ASB) is proud to announce the finalisation of a Strategic Shipbuilding Agreement (SSA) with the Commonwealth of Australia.
Under the SSA, a newly established subsidiary Austal Defence Australia will become the Commonwealth’s strategic shipbuilder for Tier… pic.twitter.com/ishzWfpNPp
— Austal (@austal) August 5, 2025
