How Much Is That LCS in The Window?

Egyptian Navy EL Fateh Gowind 2500 corvette. Naval Group

SHAH ALAM: How much is that LCS in the window? The honest answer is no one knows, really. They didn’t now know it when the Boustead Naval Shipyard (BNS) was awarded the Letter of Award (LOA) back in 2011. They still didn’t know when the RM9 billion contract was signed back in 2014 (and amended in 2017 to allow for the first delivery in 2019). Below is the official release from BHIC on the contract:

The most recent picture of LCS PCU Maharaja Lela taken in November 2021. BNS via LinkedIn.

KUALA LUMPUR, 17 July 2014 – Boustead Holdings Berhad (BHB) and Boustead Heavy Industries Corporation Berhad (BHIC) today announced that Boustead Naval Shipyard Sdn Bhd (BN Shipyard), a subsidiary of BHB and an associate of BHIC, has today signed a RM9 billion contract to design, build and deliver six (6) second-generation patrol vessels with littoral combat ship capability for the Royal Malaysian Navy (RMN).

BN Shipyard was previously presented a Letter of Award (LOA) from the Ministry of Defense (MOD) on 16 December 2011. The contract is to be implemented over three Malaysia Plans, 10, 11 and 12.

BN Shipyard Managing Director, YBhg Tan Sri Dato’ Seri Ahmad Ramli Hj Mohd Nor, said: “We are pleased to have formally signed this important contract with the Ministry of Defense and we are honoured to be entrusted with carrying out this vital national project. Work on the final design and the key procurement aspects of the project is well in hand, and the formal contract allows us to recognise a greater element of our on-going work.”

A close up of Maharaja Lela at the BNS yard in Lumut taken in 2018.

The RM9 billion (around RM600 million per ship) was supposed to be the ceiling price of the project. But by the time the first ship was about to be launched in 2017, they already knew that the cost would go higher. By how much? Again, I was told the figure was fuzzy which led to me to believe it would be around RM12 billion or RM2 billion per ship (by 2020) excluding the government furnished equipment (GFE) – the guns and missiles mostly.
A Kongsberg Naval Strike Missile (NSM) is launched from the littoral combat ship USS Coronado (LCS 4) during missile testing operations off the coast of Southern California. The missile scored a direct hit on a mobile ship target. US Navy

By 2022, I am told that the cost will be RM14 billion (if work started on January 2022, again excluding the GFE). With the resumption of the project seemingly being dragged out (likely punted over to the next government), it may well cost RM16 billion by 2025 arrived. Why 2025? That was the time when the first ship was supposed to be handed over to the RMN (announced last year when the project was supposed to start this year).
A CGI of the RMN LCS.

So how about canceling the whole project then as espoused by some quarters? The government could do that but it is likely that it will have to pay around RM5 billion more to clean up the mess. That’s on top of the RM6.1 billion already paid to BNS.
The LCS major equipment detailed. RMN graphic

The extra payment included the RM3.7 billion needed for the work already done by BNS and more importantly, to its subcontractors up to November, 2019 when the project stopped. Do note that BNS had already secured a court judgement to pay these subcontractors the amount it felt appropriate although most of them are seeking higher charges. The rest of the money are to pay for the cost of storing the equipment that already been paid. Some of these are stored locally and overseas.
LCS PCU Maharaja Lela. Her name could be seen on the stern. Picture taken on Aug. 23. 2017.

Of course, I could be wrong about the amount that needed to be paid out as I am just guessing the numbers. But I do not think anyone has the exact figure. Which is course emblematic of the whole project, no one really knows the actual figure. As for completing the project, I am inclined to believe that each of the completed LCS will cost around RM4 billion . If only two are actually completed it will be RM8 billion each. And how much is that is due to forex losses then? Only 10 per cent.

— Malaysian Defence

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About Marhalim Abas 1607 Articles
Shah Alam

50 Comments

  1. Same thing with the Indian Tejas and American F35 program. The more delays, the more user will ask to incorporate new technologies that just came up. These moving goalposts if not managed properly will be never ending.

  2. Similar not the same as both countries spend so much more money defence procurement. And to think that the Gempita was already as expensive as an M1 tank

  3. Marhalim, Azlan,

    Do you think cancelling the deal is best way out (and buying direct from elsewhere or choose a new and proven design)?

  4. There is a way to force the government to finish the damn ship as fast as possible. Just have someone rigged the entire facility with an explosive and threaten to explode the entire place if the project is not continue or cancel.

  5. Marhalim,

    The figure of 6.1 billion ringgit is the total amount of money that the Government has spent on the project, not the total amount paid to BNS.

    That 6.1 billion ringgit figure also includes all the GFE the government already paid for.

    If it is my call?

    Government to take back all GFE that is paid for the ships (NSM missile, 57mm bofors, 30mm MSI, CAPTAS2 sonar, FCS, EO)

    Cancel the project. Just let BNS cover any expenses by completing to a sailable condition and selling off 2 ships (at least 1.5 billion ringgit in value). Pass all other remaining parts (3 hulls, 4 PRISM integrated mast, etc.) back to Naval Group as 50% payment for a Scorpene. It will be a huge loss to the government, but that is something that cannot be avoided. No need to spend the remaining unpaid 2.9 billion ringgit out of the 9 billion ringgit contract.

    To cover other costs, Boustead to sell BNS to MMHE (Petronas). BNS to be MMHE subsidiary. Boustead to use the proceeds to take over Airod and merge it with its AeroServices Group, so to consolidate the aerospace service sector.

    Next continue LMS batch 2 as the replacement of the LCS in RMK 12 (2021-2025). Use LMS budget plus unused LCS budget to get 6 ships (target budget 1 billion dollars). Get the cheapest frigate design available so that means just use Jose Rizal class frigate design. Build all 6 in South Korea with NSM missile, 57mm bofors, 30mm MSI, CAPTAS2 sonar, FCS, EO taken from the Gowind project. Take out the TRS-3D radar from the Kedah class and put them on those ship to save more money. Only need to buy new anti air missiles.

    When the dust has settled, build 3 more LMS Batch 2 locally in RMK 13 (2026-2030),
    by the now MMHE owned Lumut NS for a total of 9 LMS Batch 2 ships. To save costs probably no need to buy towed sonars for these 3 ships.

    In RMK 13 (2026-2030), create a new LMMS (Littoral Multi Mission Ship) project to replace the LMS that has replaced the LCS. Go back to the original requirement of small fast and cheap fighting ships (not just a patrol boat). Something just around 50m, small crew (15-25) and large rear deck for container modules. Can deploy as a task force of one LMS batch 2 and two LMMS as “wingman” for ASW. Must not cost more than half of the chinese built LMS batch 1, inclusive with (cheap) anti ship missile modules.

  6. The shipyard is asking for RM3b to complete the first 2 and RM3b to complete the next 4. What high level mathematics the shipyard is using is a mystery when one consider the 5th and 6th ships are still sheets of steel. The problem with the project isn\’t how much each ship will cost or how many ships will be built. The real problem is whether any ships will be built. Given the shipyard’s track record, the likelihood of zero ships even if RM12b is spent is high. So one option is to keep the RM3b, throw it at the LMS Batch 2 program (increasing the number of ships), built by a foreign shipyard, with a high chance of being delivered on time and on spec – protecting the Navy’s intetesf. The other option is protect local contractors, who are equally responsible for the project’s problems and hope something will be delivered. RM3b or RM6b is a lot of money to be spending on a project with high risk of failure.

  7. I hope this project is the last legacy of an old man, developing a heavy industry in Malaysia. Perwaja failed, DRB Hicom failed and Proton failed. We just have an assembly industry like previously amd not much value add. An industry of rent seekers.

  8. gonggok – ”and selling off 2 ships (at least 1.5 billion ringgit in value).”

    great idea on paper but what if potential customers who are not spoilt for choice decide that those 2 ships; configured for the RMN’s requirements; are not what they need? What happens to those ships?

    gonggok – ”Take out the TRS-3D radar from the Kedah class”

    The TRS-3D radar would have to be integrated with the CMS, directors and other things.
    Slightly off topic but an issue faced with the TRS-3D is – like other German stuff – slightly over engineered; too many modes and switching to the right mode takes time. The Danes discovered this when they were trialing it alongside SMART.

    gonggok – ”Go back to the original requirement of small fast and cheap fighting ships (not just a patrol boat).”

    This ”patrol boat” thing has become somewhat of a cliche but there is zero intention on the part of the RMN to get any; it has pressed the case for fully fitted out ships.

    gonggok – ” to replace the LMS that has replaced the LCS”

    The narrative is that he LMS Batch 2s are intended to ”supplement” not ”replace” the LCSs [can’t ”replace” it as it’s a different class of ship intended for entirely different things in different operational scenarios]; to perform niche roles by themselves or alongside other assets; in operational circumstances which no not require a larger LCS or a Lekiu or Kasturi – that is what they are for and why the RMN has been pressing for them. The fact that that a company offered a design to fulfill the Batch requirement armed with a 57mm Bofors amongst other things in a conventional layout; was not because it was a request for the RMN but because it was felt that it might gain interest. As it stands from what I recently asked from someone in the know; the intention is still for a design configured for modular payloads rather than one with a conventional design/lay out. This reinforces what was previously discussed.

    For me the key question is what happens if either a mere 2 LCSs enter service or the whole programme is scrapped? The RMN from what I know has already done some paper feasibility studies in case things go ratshit but it’s still early days. The LCSs for the RMN are intended to be it’s main surface combatant with a certain level of capability; range, endurance and seakeeping; the LMSs operating in a supplementary role. Not having the LCSs and not getting a replacement anytime soon will be a major blow for the RMN’s plans; having a huge impact and far reaching consequences.

  9. azlan,

    “The TRS-3D radar would have to be integrated with the CMS, directors and other things”

    The TRS-3D is the exact model of radar that is supplied with the Philippines Jose Rizal frigate, and it was integrated with Hanhwa Naval Shield CMS. Which is why I mentioned it as an option.

    “For me the key question is what happens if either a mere 2 LCSs enter service or the whole programme is scrapped?”

    The best option right now is for the LCS program to be scrapped, and whatever allocated budget that has not been spent combined with the LMS batch 2 budget to get the capability that the LCS Gowind was supposed to provide.

  10. kel – ”The other option”

    The other option is we finally wake up from the cloud cuckoo land delusion we’re in and take a hard and honest look at why things go ratshit; why we keep repeating things with little to no ability to learn and to decide if defence is something we are going to take more seriously. We also need to be realistic and ask ourselves what we want to achive and what we actually whilst getting our money’s worth and the services the capbility they need.

  11. gonggok – ”it was integrated with Hanhwa Naval Shield CMS. Which is why I mentioned it as an option.”

    Yes but the radar has to be integrated with various other things apart from the CMS.

    gonggok – ”The best option right now is for the LCS program to be scrapped”

    I have no idea what the ”best” option is; various dynamics at play and no quick solve it all solutions. The problem is we are doing things in too little a manner [3 Batch 2s this MP and 5 the next] taking too long to do. On top of that we have a disastrous defence policy which places priority in not the end user and taxpayer but national interests. Together with our antipathetic mindset to defence; this means we don’t get the best value for what we spend.

    Two immediate issues –

    LCS. Never mind that the LCSs are/will be too lightly armed making them suitable for low to medium intensity threats and have little to no deck space for upgrades; they are meant to be the service’s main combatants; the ‘Team A’ so to speak. Even if the programme is reduced to a mere pair; this would still leave an unfulfilled requirement. Complicating matters is the Lekius and Kasturis at best can be economically operated for another decade or a half at most before major issues set in on account of age; even then various things will have to be replaced.

    LMS. These are intended to be our ‘Team B’ performing roles such a ASuW, ASW and other things by themselves in certain conditions or with other assets [as part of a networked environment] and to replace the FACs and Laksamanas [as part of original plans both should have been scrap metal years ago] but whether we ever get them in the desired numbers remains to be seen. Something else that remains to be seen if we find the modular payload approach suitable for our needs. We adopted this approach out of sheer necessity; not choice; unlike the Danes whom proponents of the modular approach often cite as supposed proof of utility. Some navies wear by the modular approach; others don’t. Some [including a ex MCM Squadron CO I personally know and others] are unconvinced. We can say that the Batch 1s should be transferred to the MMEA but realistically this is as unlikely as Cambodia raising a combined arms Shock Tank Army.
    The RMN is so stretched that the Batch 1s are highly needed.

  12. kel – The shipyard is asking for RM3b to complete the first 2 and RM3b to complete the next 4. What high level mathematics the shipyard is using is a mystery

    if not mistaken from my understanding the stories goes something like even before LCS started, BNS are some billion in debt as they absorbed the cost overrun of the kedah to save the then gov some face in the pretext they get future contract to recovered the cost. a contract that never comes as the gov order the gagah samudra from someone else (which end up failing as well). the gov finally give BNS the contract for the NGPC2 but BNS had partnered with DCNS and offered a ship more or less a bit to0 expensive with weapon system & CMS that not to the navy liking. BNS then proceed to use the money from LCS to pay off the kedah debt then proceed to build the ship even without finalizing the specification with the navy as they hoping the navy would just shut their mouth & just received what they would handed to them since any changes would already increase the already high price of the ship. thought the navy never actually quit & keep lobbying to change the equipment & weapon which result in constant redrawing of the ship. afterwards the oil price crash sending ringgit value down and the shipyard use all available cash to procured the equipment beforehand. afterward they get themself some billion in high interest loan to continue the project. at this point theres an election, if BN had win they probably just adjust the value of the project and give foreign exchange losses as the reason. But BN didn’t win, and PH after learning about the ship didnt really fulfill RMN requirement decide not to sign on to the propulsion system installation which lead to the 1st ship unable to perform sea trial thus terbengkalai mostly so that PH can use it as a political weapon to tarnish their opponent image. But to be fair to PH, paying a lot for ship that doesn’t fit in RMN requirement is stupidity at it finest. the only meaningful update is when the ex manhen now PM told reporters that the ship is undergoing final final design scheme by DCNS that end last February afterward the gov just kept their mouth shut.

    my opinion is at this point there’s 1 to 2 or more billion that BNS want from the LCS project that has nothing to do with completing the LCS but more to do with them being in debt. while the gov had procure NSM they never actually procure the MICA, now be it MICA or other missile the SAM component of LCS should be at least 1 billion ringgit more. so in actuality we have 2-3 billion of money to pay for stuff not related to cost incurred to glue the ships together. thus likely explain the odds 3 billion for 2 ship and another 3 billion for the other 4 math BNS gives.

    gonggok-

    cancelling it then start anew or reducing the amount of ship is unrealistic, we already spend 6 billion on all the hulls, equipment & radar & so on. no one going to buy those 2nd hand, just look at nakhoda ragam case for example. what more despite officially terbengkalai BNS are still assembling the 5th LCS structure together. so like it or not the only solution is to continue gluing it together.

    i personally doubt that the problem is money. assuming annual development budget of 1.5 billion. they do have between 7.5 billion this RMK for nothing else then for the LCS, 3 heli and some planning cost on 3 LMS2 and some cost to preplanned the MRSS. the LMS2 itself is still at the RFI stage. add in the bidding, selection process, announcing winner then finalizing design then construction and sea trial, i doubt we see it before 2030. building a combatant, what more a multirole combatant is not like buying proton x70 at the nearest dealership. when the last time ATM or even SAF pull a TNI and just get something off the shelf?

    the problem here is really the problem of narrative. basically what the gov want to tell the voter and have the fallout be the lease painful for them as possible. 1 option is a bailout on top of another round of creative accounting to hide the actual cost from public view just like the kedah.

    for bailout part they have to get another GLC to acquire BNS or from some news before the gov going to acquire some of BNS asset namely the kedah & gowind blueprint whatnot. while such asset is worthless for the gov to acquired it does help with BNS cashflow problem.

    the other is creative accounting while the kedah choose ffbnw, right now one can just hide the cost of SAM with TD acquisition of GBAD by sharing common missiles. then let BNS to continue absorbed the overrun of the lCS on top of the kedah by promising them constant future contract to pay of such debt.

    or you know, just comes clean and pay all the money so the LCS wont haunt them in the future as the kedah did and gov can choose whatever yard they want in the future. which is why this option wont ever see the light of day because what kind of gov would admit salahlaku or what kind of business don’t want potential future contract.

  13. I think people are not understanding the real problem. It isn’t a narrative, cost, politics, or corruption problem. The real problems are whether the ships will be built and the impact on funding. Everything else is wayang. The concept of “we have spent RM3b, therefore we should continue” is only valid if releasing the RM3b for “work already done” will with near absolute certainty, get the Navy at least 2 LCS in 2025. But, isn’t the shipyard requesting RM3b to pay of “work already done”, which is zero ships completed? So really, the RM3b+3b for 2+4 is the shipyard using the RM3b meant for the first 2 to pay off work already done, and use the RM3b meant for the next 4 ships to complete the first 2. Which means, the shipyard will ask the government for additional money for the last 4. Since the first ship won’t be ready by 2025, it means the next round of funding top-up will slam right into RMK13 funding and basically drain funds from other programs earmarked for RMK13. How is this even acceptable. I would rather the shipyard just say, give me RM6b and I will definitely built 2 LCS by 2025 then try to wayang and shuffle money around to show progress for 6 ships, to the point zero ships will be built. If the Navy feel 6 super glorified gunboats is better than 3 to 4 smaller but better equipped LMS Batch 2 ships, then spend the RM6b and hope, worst case, scrap all the missiles and proclaim the ships as the most advanced “built for but not fitted with” ships of its class

  14. When this ship ready to roll-out, the on-board system is already 10 years or more behind than others. It end up we need spend another money to upgrade it when it just use.

  15. Pretty much what I have hypothesized for some time, the project was knowingly underbudgeted. By the time it risen to RM 12Bil, I suspected the BN Govt then intended to quietly pass a supplementary budget to fund the RM 3bil shortfall. This plan fell thru when they unexpectedly lost in May 2018 and when PH Govt put the brakes on funding, it only exacerbates the issue and the cost continued to rise without tangible progress.

    Now the question, whether can we abandon it and move on? No, it is too big to fail. Realistically once the political situation stabilises after GE15, we will continue to fund them until all 6 are completed whether by BNS or via another GLC. Come hell or high water, they will get done, by hook or by crook, its just that it will take a longer time but in the end we will wait and wait and then swallow them like we did with the Kedahs.

    Will we learn from it? I doubt it. The problem is we pretend to afford the high end things we want. Seorang pemiskin berlagak macam orang kaya. If we want top end stuff and do them locally we better budget for it, if we cannot afford it then move down to something lesser.

  16. Or opt for the one rmn originally want is it damen sigma light frigate like tni al’s martadinata?..Or else korean made ffx designs like incheon,daegu or ulsan class if this project is cancelled..still would be cheaper than perunit lcs pricetag if we ask them to put that gfes on new frigates..but at what cost

  17. 12 billion or another 6 billion/2 billion pership for all six ships is still acceptable..any higher than that well…But im not suprised if our super glorified frigates will end up costing 3-4 billion each…Thats almost fremm frigates cost..

  18. And dont get me started on that 1 billion from 6 billion paid that presumably missing without audit..Maybe just maybe if that one billion are not mysteriously missing,maybe this project will not be this bad..

  19. Marhalim,

    “Yes we can put the GFE on other ships, but we will still be paying around RM12 billion for the LCS”

    Let’s look at it this way.

    Yes we will still spend 12 billion ringgit at the end.

    But

    It will be 12 billion ringgit spent from allocated budget, not 9 billion ringgit budget plus additional 3 billion ringgit that has not been budgeted before. Sacrificing the LMS budget to get a frigate is much more easier than asking for more budget for the failed LCS project. Later in RMK 13 when we finally got the needed frigates, a new project (say named LMMS) can be proposed to get the proper LMS mission capability.

    Lets say if you go with the korean Jose Rizal class frigates, you will surely get your 6 ships on time and on budget. Can BNS give assurance that the gowinds can be completed on time and with no more surprises with the cost? I really doubt it.

    Also lets say we offer everything left of the gowind project, 2 sailable ships, 3 completed hulls, all the PRISM radar integrated masts, engines, etc. back to Naval Group in exchange for 1 new Scorpene. It would be a good deal for Naval Group (surely all those items are at least 2x the value of a single Scorpene), and we would get something out of the mess and not needing to think on how to sell off all those ships. As the developer of the Gowind, Naval Group would have no big issues to finish and sell them on to 3rd parties (particularly now with increased defence spending worldwide due to the ukraine conflict).

    So for 12 billion ringgit we would get 6 LCS Batch 2 Frigates based on Jose Rizal class frigate and 1 new Scorpene. Not ideal, but probably the best outcome of this messed up project.

    breakdown
    6.1 billion ringgit already spent
    4.2 billion ringgit on 6 LCS Batch 2 based on Jose Rizal class frigate.
    1.6 billion ringgit to pay off any BNS debts
    Passing all the Gowind hardwares (minus GFE) to Naval Group in exchange for 1 new Scorpene.
    Sell off BNS to MMHE to cover additional debts (if any) of the project, and to recapitalise BNS for future projects.

  20. The government especially Mindef keep going with the same mistake and repeatedly scenario since NGPv and Training vessel..They should built first 2 units in France then the balance in local shipyard but still prefer to built 6 of it locally..As a Malaysian most of us tired of this repeated issue.What happened to the government monthly KPI purpose if they unable to monitor it..The navy should cancel their dream to build a blue water navy and buy FAC with missile only to protect both Peninsular and East Malaysia

  21. No, again the bill is RM9.1 billion of the ceiling price of the LCS which need to be paid. And it is likely by the time, the project stopped, the amount of work done was more than the ceiling price already. Furthermore, at least RM1 billion will also need to be paid for storage of equipment

  22. It’s not missing lah, see my earlier stories, it was paid to BNS to upgrade its facilities and was also used to pay off its debts incurred by finishing the Kedah clasa

  23. Wait what? upgrade its facilities are understandable but pay off its debt using LCS money?..Is that totally normal or what? and the govt allow them to do that and just let them be?

  24. kel – “I think people are not understanding the real problem. It isn’t a narrative, cost, politics, or corruption problem”

    On the contrary those things are every much part of the problem and the narrative because they have led us to where we are now. To really avoid another repetition a few years later with yet another programme we have to be honest with ourselves in acknowledging how we buggered up so badly. Alas we won’t as we have a inability to learn from mistakes.

    kel – “Everything else is wayang”

    It’s precisely that attitude which will ensure we remain in the rut we are in.
    Even if all 6 are delivered this will my change the fact that again we have something whose capabilities don’t reflect what we’ve spent on it.

    gonggok – “have no big issues to finish and sell them on to 3rd parties (particularly now with increased defence spending worldwide due to the ukraine conflict”

    That’s assuming certain navies are willing to have hulls constructed in Malaysia and hulls designed with RMN requirements in mind.

  25. Hang Nadim – They should built first 2 units in France then the balance in local shipyard but still prefer to built 6 of it locally

    Would still likely turn out the same. Either rotting at some yard in Europe like nakhoda ragam rather than lumut or be another overpriced OPV like Kedah & Jose Rizal. While there are some engineering & technically issue it’s not the main reason why it terbengkalai.

    It terbengkalai if not mistaken primarily because the gov & navy themselves refused to sign off propulsion system & CMS installation on the 1st 2 ship. rumours has it that the navy didn’t want the setis & mica which is the justification used by ex manhen Mat Sabu to order the construction to be stop.

    The problem mostly related to BNS which is staff with retired navy general has horrible managerial skill making one bad decision after another rather than the yard workers has engineering & technically deficiency.

    The navy should cancel their dream to build a blue water navy and buy FAC with missile only to protect both Peninsular and East Malaysia

    What can FAC & missile boat do to increase the surveillances, target acquisition nor firepower that land base radar, uav,UUV,usv, satellite, stratosbus, AF plane & land base or air launch missiles can’t do? A tomahawk for example cost 2 million USD each & has a 1600km range, JSM & himars has a range of 500km. The widths of SCS from Borneo to Vietnam is only 1000km. If we look at the Falkland war, ship despite being equipped with the best of defenses are still extremely vulnerable to air launch ASuw missiles.

    Add in That constabulary duty even the coastal radar is done by the CG while ASW MPA & MALE operated by the AF. there’s not much any navy can do for their homeland defense these day and age. one either evolved into a green water navy or become a token navy.

  26. @gonggok
    “offer everything left of the gowind project”
    Why would they want our LCS or the equipment bought for it? Our LCS is a BNS redesign of Gowind hence it is not the same ship from their catalogue, so they would not want to be responsible or liable for whatever changes done by BNS. Neither would they be interested on the equipment fit out as not all their customers would pick the exact configured stuff that we bought.

    In any case such direction could not meaningfully recover enough money to make restarting worthwhile. As pointed out we had spent RM 6bil and would need to spend another RM6bil to clear accounts even if we cancel the whole thing. How much can we recoup disposing them? At most RM 1-2Bil. Then we will have to spend another RM 12-14Bil just to redo the whole thing still without the certainty it won’t go FUBAR again.

    Versus the more realistic route of restructuring BNS and/or selling it to another GLC to recover the losses and given the RM 10Bil needed to complete the whole thing. Look at precedent, we have delayed but ultimately completed similarly troubled ships of the past; Kedahs & Gagahs. The LCS would not be any different, it will be done. Its just a matter of when & how much.

  27. We shoukd finish all six ships so that this episode is forever etched in the minds of our politicians the cost of capacity building of our defence industry. It serves as a grim reminder the next time they decide to pursue another national interest project. Another legacy of the old man’s wet dream.

    If we stop at two ships it is just a repeat of the NGPC project. The pain was swept under the carpet and we get 6 toothless ships. The cancer was transferred to BNS.

  28. @Hasnan
    “serves as a grim reminder”
    Eventually, sooner or later, by hook or by crook, we will finish these 6 ships as we had done in the past. But to whom it will serve the reminder? Our decisionmakers? The Kedahs fiasco did not remind anyone when the Gagahs came. And the Gagahs fiasco did not remind anyone when the LCS came. I doubt the LCS fiasco will remind anyone when the next project to come. We should just accept that such inefficiencies is gonna happen anyways if we continue this national building trajectory, and learn to provide extra budgeting for when the FUBAR eventually hits. To me, that is the grim reminder for subsequent projects.

  29. 5Zaft – The navy should cancel their dream to build a blue water navy and buy FAC with missile only to protect both Peninsular and East Malaysia”

    Having large ships or ships of a certain range and endurance doesn’t result in a “blue water” navy. Strictly speaking a “blue water” navy is one that has a,fleet train to enable one to deploy for extended periods without the need to return to base for resupply.
    The RMN has no intention of creating a “blue wAter” navy; the decision to.go for combatants of a certain displacement is driven by the Ned to Have a certain capability but not to have a “blue wAter” navy.

    The RMN sees the need for ships of a certain displacement to replace the FACs but due to inherent issues FACs have; namely range, endurance and sea keeping it has no plans to get anymore FACs… At minimum the LMS Batch 2s will be of similar displacement to the Batch 1s. Also note that a traditional role of FACs is sea denial on a littoral environment[we operated our FACs for extended EEZ patrols for which they aren’t designed for ]; the LMSs are intended to perform various roles.

  30. 5Zaft – “Falkland war, ship despite being equipped with the bes of defenses are still extremely vulnerable to air launch ASuw missiles”

    – The RN had no early warning capability [this,makes a,world of difference]. They later mounted a radar on SeaKings.
    – Apart from Seawolf [which still had steering issues] and the ineffective 1960’s wire guided Sea Cat the RN only had Sea Dart which was designed for medium to high altitude targets.
    – Air cover for the fleet was limited to a small number of Sea Harriers which had limited range and endurance and only short range Sidewinders.
    – The ability of a ship to defend itself against aerial threats would be dependent on early warning [from other assets]; a hard and soft kill option; air cover and other things.

    5Zaft – What can FAC & missile boat”

    I have given you the reasons why the RMN and many other navies have moved away from FACs. FACs were intended to perform limited sea denial; the idea being that a cheap and small FAC could destroy a larger target [sinking of the Elait] was supposed to usher in a new era of naval warfare]. In addition range, endurance and short range sensors [a low freeboad plays a large part] FACs lack the means to defend themselves if attacked; the Battle of the Bubiyan Channel; Operation Praying Mantis and S-Boot ops during WW2 are classic examples.

  31. It’s dollar and cents. If the government goes ahead and complete the 6 ships, it will cost more than RM12b. Whole project has hit RM9b with zero ships. What do people think the final $ is? If we do the by hook or by crook approach and the whole project end up costing RM15b, which will have to be funded by borrowing from RMK13 and RMK14, would the Navy have any money left for LMS Batch 3? The MRSS? Additionally helicopters? A proper MPA? I’m in the camp that either built 2 and buy 2 similar ships from a foreign shipbuilder, or scrap the LCS, cut losses and focus on other shipbuilding programs. The reasoning is simple, there is a high probability even with RM9b given, there will be zero LCS. In fact it is reasonable to assume that there is a probability of zero LCS even after RM12b. The alternative is, the government scraps the weapons integration and make the ships gunboat like NGPV. Then the 6 LCS should be completed. But really? All that spending and bruh hah for another 6 glorified gunboat?

  32. Quick question, does BNS operating in a deficit all this time or what? If so, should we really be surprised with this ill-fated outcome of our LCS project?

  33. kel – ”If we do the by hook or by crook approach and the whole project end up costing RM15b, which will have to be funded by borrowing from RMK13 and RMK14, would the Navy have any money left for LMS Batch 3?”

    Thus the conundrum. Many moons ago I pointed out that failure to resolve the LSC issue will have long term consequences with a wide impact. Unfortunately I was right.

    kel – ”In fact it is reasonable to assume that there is a probability of zero LCS even after RM12b.”

    Most people in the service and other places whom I’ve asked are of the opinion that at minimum a pair will be completed. They key question is what next and how many more years will it take for replacements to be commissioned?

    kel – ”All that spending and bruh hah for another 6 glorified gunboat?”

    To be fastidious; they would be guns only equipped ships. ”Gunboats” typically implies something in the 4-500 tonne range.

  34. Kel – or scrap the LCS, cut losses and focus on other shipbuilding programs.

    If you ask me, continuous reboot is one of the mistake we keep doing. taking the easy way out by cutting the order, changing the foreign partner, design & shipyard from the f2000 to Kedah doesn’t make Kedah a success, rebooting the Kedah to gagah doesn’t make the gagah a success. Then the debt, brain drained from rebooting subsequent Kedah into gagah haunt the LCS.

    Meanwhile during the same time TD spend 10 years building the m113a1, then the next 10 years for gempita. It not cheap but at least they got something usable out of it.

    The decision to continue the LCS isn’t a popular one thus why the gov won’t likely made it B4 the election. A lot of voters still want a reboot despite rebooting hasn’t actually work for the last 2 decades.

    I think Marhalim had run a story on the final LCS configuration & some equipment changes that would satisfied the navy, those aren’t cheap but a necessary break from the past where gov priorities ship completion even if it just a useless toothless OPV.

  35. It won’t be toothless as the guns and NSM would already be procured by now as well as the Sylver launchers. Only left to buy is just MICA VLS missiles, perhaps the light torps too. So unlike Kedahs it will hardly be toothless.

  36. All these comments from now and yesteryears really makes me wonder. What equipment actually does the RMAF, RMN and ARMY want? Arleigh Burke’s? F-15’s? M1 MBT?

  37. zainal – ”All these comments from now and yesteryears really makes me wonder.”

    Simple answer and nothing to ”wonder” : stuff which suits operational requirements; which has some level of commonality if possible; which is not cost prohibitive to operate and maintain for its projected period in service and can easily be supported.

    One only has to look at stuff the armed service wanted and received as opposed to stuff the politicians decided had to be bought because of national interests; a prime example is the stud ”technology” we got for the PT-91s and the fact that had NASA agreed to train an astronaut we’d have gone down the more practical, efficient and cost effective route of ordering Super Hornets rather than Flankers. A lot of what we buy doesn’t even go through extensive evaluation; instead brief paper evaluations are done and we take the manufacturer’s claims at face value. A common mistake is to assume that just because ”equipment A” is operated by others without apparent major issues; it will be the same for us.

  38. 5Zaft – ”ontinuous reboot is one of the mistake we keep doing. taking the easy way out by cutting the order, changing the foreign partner, design & shipyard”

    What do you expect given the very policy we have? A policy where the main aim is to benefit the local industry and other areas rather than ensuring the end user gets the capability desired and the taxpayers their money’s worth…..

    5Zaft – ”Meanwhile during the same time TD spend 10 years building the m113a1, then the next 10 years for gempita. It not cheap but at least they got something usable out of it.”

    The Adnan is based on the M113 but calling it a M113 is fundamentally incorrect as despite sharing the same design and other things it’s a very different vehicle. As for ”something usable out of it” maybe but at what cost? Was is worth it from a cash perspective and any tangible results achieved [apart from Deftech making money and giving the impression both are ”buatan anak tempatan”] : no it certainly wasn’t worth it. if you want to use ”something usable out of it”’ as a yardstick we could have bought 30 year old BMPs-1s or even 50 year old T-54/55s from a number of sources for a few hundred thousand each and they still would have been ”useable”.

  39. So we can continue pay more to get the ships, or we can cancel all, pay more too, and get zero ships. Either option still need us to fork out billions of money. So which decision would give us the most return of investment?

    Even if we completed 2 ships at rm9 billion, we still need to pay more than that right?

  40. Zainal Abidin “All these comments from now and yesteryears really makes me wonder. What equipment actually does the RMAF, RMN and ARMY want? Arleigh Burke’s? F-15’s? M1 MBT?”

    Guess on who you ask i guess. Either the man & woman in the front line or the general in their posh office.

    IMHO the general in their posh office at mindef would want ATM to be capable as ADF as well as compatibility with ADF to work together. And maybe just maybe ability to work with the rest of maritime south east Asia neighbors to present a unified front.

    There’s are some similarities in numbers per platform between ADF & ATM (like 400 ish m113, 50 ish tank, 200 ish wheel IFV, 30 ish SPH, 3 LPD) & the type of platform (M113a1, meko, hawk & hornet). They are also similarities in ADF DWP & ATM owned DWP cap55,15 to 5. Like ATM,ADF had also publicly published the weapon type,time of acquisition, numbers per platform up till 2050s. I say it mostly the same. Other then the fact our defense budget is 10% of theirs.

    There’s also a lot of similarities to ATM long term planning & planned numbers per platform not just with ADF but SAF & AFP as well. They IMHO pretty much seem trying to acquire the same kind of capabilities & platform just with different budget & thus the timeframe of acquisition,or to priorities qualitative or quantitative advantage

  41. 5Zaft – ”Guess on who you ask i guess.”

    Irrespective of who you ask the answer will be he same : ”stuff which suits operational requirements; which has some level of commonality if possible; which is not cost prohibitive to operate and maintain for its projected period in service and can easily be supported”

    If however you ask a senior officer whose near the end of his career and who spent most of it in an army focused on internal security; he will probably have less of an appreciation compared to newer gen officers about how things have changed and evolved.

    5Zaft – ”And maybe just maybe ability to work with the rest of maritime south east Asia neighbors to present a unified front.”

    No …. for the reason that although we are part of ASEAN thee is no common stand on defence with many countries pursuing different agendas as part of their foreign policy. We have bilateral exercises with neighbouring countries but these are mostly limited; our emphasis is training and having some level of interoperability with FPDA partners and the 2 countries we have the most extensive defence ties with : Australia and the U.S.

    5Zaft – ”There’s are some similarities in numbers per platform”

    If one truly wants to look; there are similarities everywhere with everybody. The major disimilarity with the ADF is that it plans to have the ability to operate and sustain itself in a high intensity protracted conflict as part of a joint force alongside Tier 1 partners in an expeditionary role. The MAF in contrast sees itself being involved in conflicts of limited scope and duration.

    The difference is that the Australian White Paper tells us a lot. Ours was highly political and PR driven in nature; didn’t tell us much of what we already knew; was ambiguous in many areas and left questions answered. Prior to it being released I had cautioned people here against having too high a hope about what the White Paper would contain.

    5Zaft – ”There’s also a lot of similarities to ATM long term planning & planned numbers per platform not just with ADF but SAF & AFP as well.”

    Lot of similarities everywhere; even us and the armed forces of Central African Republic if want ones to look. The militaries you listed pursue policies which are driven by a varying threat calculus; economic, political and geo political/strategic factors.

  42. Seems money is not a deciding fzcor anymore. Its more of whatever it takes to complete the LCS. Whether 9,12,15 or 18 billion is secondary. As long as there will still be money to acquire additional helicopters, LMS Batch 2 in this RMK and LMS Batch 3 in RMK13, proper MPA, and a new pair of MRSS. Also as long as it doesn’t eat into the Air Force’s LCA budget, and the planned Nuri replacement in RMK13.

  43. kel – ”’Seems money is not a deciding fzcor anymore”

    Actually it is in a major way …

    If it wasn’t the LCS issue might have long been resolved and we wouldn’t be where we are at present. Money is a major factor for the civil servant bureaucrats whose job it is to allocate the cash and sign of on it. The longer the LCS issue is unresolved; the more impact it will have on other areas which need addressing and there will be effects – more money at play…

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