Taiwan Vote May Help EB
Company Could Get Contract To Design Sub
By JESSE HAMILTON | Courant Staff Writer
December 15, 2007
A major committee of the Taiwan legislature this week approved a $62 million spending package for submarine design that could lead to a windfall for Electric Boat in Groton.
It also could lead to the precedent-setting situation of a U.S. company's building submarines for a foreign navy.
Rupert Hammond-Chambers, president of the U.S.-Taiwan Business Council, said Friday that "the odds are pretty high" that the money will survive a pending vote of the overall legislature. Taiwan's Legislative Yuan has final say over the country's spending, and it might release more money for submarine work in 2008.
The United States is the main weapons supplier for Taiwan, a country protected by America but claimed as a wayward province by China. One of the two U.S. submarine builders — Electric Boat or Northrop Grumman in Virginia — would probably get the job of relearning how to build more modern diesel submarines for the small, Asian ally.
"It gets the ball rolling to start design work," said Justin Bernier, who runs Connecticut's new military liaison office. "Electric Boat is home to the nation's full-service submarine design capability. That's a national strategic asset that we need to make sure stays in business. This potential funding could help do that, help keep our guys working on blueprints instead of getting pink slips."
Taiwan has long flirted with the possibility of ordering U.S.-designed subs. President Bush, in his first months in office, offered Taiwan eight yet-to-be-built subs. High costs and a standoff between Taiwan's political parties, however, had locked up expensive weapons purchases for years. But that freeze has thawed unexpectedly, producing this defense budget that also includes Patriot anti-missile systems.
America doesn't actually make diesel subs. It hasn't since nuclear boats took over in the 1950s. But although several other countries manufacture those smaller, cheaper, less-capable submarines, none of them is willing to deal with Taiwan for fear of upsetting China.
As a congressman representing Groton, Rob Simmons, now the state's business advocate, was the leader of the U.S. side's effort to close the submarine deal. Having worked in Taiwan during his years as a CIA operative, Simmons spent time there, too, as a congressman. His last major push — the "Simmons Plan" — was to make the deal more palatable by encouraging Taiwan to pay for the design costs without committing to construction.
The estimated cost for design: $226 million. Although the $62 million approved this week is far short of that, Simmons said Friday, "You can buy a lot of design work with that. That is not a trivial amount."
Although several U.S. defense contractors could be in a position to bid on parts or all of the contract, Simmons said that Electric Boat is "the best." And he supports the idea of it getting into the business of building these smaller submarines powered by diesel and batteries, which Simmons thinks the U.S. Navy should start ordering for itself.
China builds diesels and nuclear subs, he said. "We should be doing the same."
This is the first time in generations that Electric Boat's designers aren't working on the next generation of submarine. That's left the design force trying to scrape by on small jobs. But before Electric Boat would go for the Taiwan work, it would need support from its only customer — the U.S. Navy.
"If the Navy approves it, and the Taiwanese legislature funds it, we are very interested in pursuing that work," said Robert Hamilton, a spokesman for Electric Boat. He called it "a very complementary type of project" to the company's usual nuclear submarine work.
A 2006 letter to Simmons from the deputy secretary of defense said that the Pentagon still supports the president's 2001 proposal to build subs for Taiwan.
In August, Taiwanese legislators and military officials visited the EB factory on the Thames River. Four months later, they are working on what Hammond-Chambers said could be "the most significant budget they've passed in a decade." It came as a surprise to him, especially after being told by Taiwanese legislators in a trip three weeks ago that they were going to reject submarine money.
Although Taiwan can't keep up with a Chinese military that is building weapons at a furious pace, Simmons said that these submarines could be "the perfect defense system for Taiwan." They are stealthy and would be hard to keep track of in their territory beneath the Taiwan Strait.
Taiwan's legislature is expected to finalize this first step within the next few weeks
