UK orders second batch of five Type 26 frigates for £4.2bn

By Timothy Choi

The Royal Navy has announced that it is proceeding with the remaining five ships of their Type 26 frigates and has awarded a £4.2 billion contract with BAE Systems for the ships' construction. The five ships will be named Birmingham, Sheffield, Newcastle, Edinburgh and London.

Of particular interest to Canadian observers is the following passage from the Royal Navy press release:

Due to lessons in building the first batch of new frigates, plus improved assembly facilities – including a new undercover construction hall – the final five Type 26s will be built for around two-thirds the cost of the initial trio, and they will be built and delivered to the Fleet more quickly.

Note the lower cost of follow-on ships, consistent with the expectations of economies-of-scale.

At £840 million ($1.3bn CAD) per hull, this would seem to be heartening news for Canadians - at the very least, it suggests that there's nothing fundamentally strange or excessive regarding the Type 26's basic hull. Given the high levels of similarities between the UK Type 26 and the CSC, the new contract figure makes for a good starting point for estimating how much more the CSC will cost to incorporate the more advanced air-defence and Aegis components. However, it should be noted this £840 m figure is for the construction itself (since it's an actual contract with the shipbuilder) and does not include the multitudes of ancillary costs associated with the program writ large (project management, staff, ammunition, spare parts, shipyard modernization, etc.), which are generally included in the estimated acquisition costs for the CSC.


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