*

Prime Minister Anthony Albanese pledged A$74 billion for

missile

acquisition last year

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Country builds partnerships with Lockheed Martin ( LMT ),

Kongsberg and

Raytheon

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Lockheed Martin ( LMT ) says in talks over hypersonic weapons

By Kirsty Needham

AVALON, Australia March 27 (Reuters) - The Ukraine war

and increased European defence spending are likely to slow

Australia's plans to develop its own missile components'

capability as it pushes ahead with a multibillion-dollar effort

to acquire long-range strike missiles.

Prime Minister Anthony Albanese pledged A$74 billion ($46.68

billion) last year for missile acquisition including A$21

billion to establish a Guided Weapons and Explosive Ordnance

Enterprise in Australia, as his Labor government reshaped the

country's defence strategy to respond to China's military

build-up.

Hedging against global supply issues, Australia signed a

flurry of orders with U.S. and European defence companies,

including Lockheed Martin ( LMT ), Kongsberg and Raytheon.

Lockheed Martin ( LMT ) vice president for missile and flight

control Tim Cahill said that the U.S. company was in discussions

with Australia on "long term and short term solutions" for

hypersonic missiles, which Australia wants to defend its

northern borders.

"Long range strike and hypersonics - long range fast strike

and very survivable strike - is clearly a priority," Cahill said

in an interview at this week's Avalon Air Show.

Gathered at the event in the southern state of Victoria,

defence executives said global missile component shortages and

high demand, and the need to improve the capacity of Australian

suppliers, meant Australian components would only gradually be

built into local production.

Norway's Kongsberg plans to have a common supply chain

between Europe, the United States and the Indo Pacific when new

factories in Australia and the United States open, with the

workload distributed across the facilities, said its Executive

Vice President of Missiles & Space Oyvind Kolset.

"Of course the demand is extremely high now, it's a

challenge to ramp up at the rate we are doing now, but at least

we have worked on this for a number of years," Kolset said,

referring to missile production for the Ukraine war.

The company has also contracted 10 Australian suppliers for

possible work on later installations of its Naval Strike Missile

on the deck of Australian frigates, said Kongsberg Australia

general manager John Fry.

Some parts of the missile supply chain require more

industrial capacity than Australian currently has, he said.

"Making the missile from scratch with today's capability

wouldn't be possible. We can't do that in Norway either, we rely

on suppliers in the U.S. and Europe," said Kolset.

Lockheed Martin ( LMT ), meanwhile, expects to produce Guided

Multiple Launch Rocket Systems (GMLRS) in Australia this year.

The supply of solid rocket motors needed for GMLRS in the

United States was "not sufficient", Cahill said in an example of

global shortages.

Cahill said Australia's Guided Weapons and Explosive

Ordnance Enterprise was strategically important and would bring

high capacity production outside the United States for the first

time.

Although 60 local companies had been identified as potential

suppliers, Australian content would be slowly be brought in, he

said.

Lockheed Martin ( LMT ) has delivered the first two of 42 High

Mobility Artillery Rocket Systems (HIMARS) launcher vehicles

ordered by Australia, even with the demand in Ukraine.

Australia has said army regiments with HIMARS can be

transported by C-17 aircraft to neighbouring island states,

which have defence agreements with Australia, in any regional

conflict.

Australia will select a second order of land-based missile

systems by the end of the year, with HIMARS and Kongsberg's

Naval Strike Missile mounted on an Australian-made Bushmaster

truck shortlisted.

Kongsberg's Kolset said the United States Marines Corp was

already deploying its system in the region. "For the Marines,

this is their highest priority programme," he said.

($1 = 1.5853 Australian dollars)