SHAH ALAM: LMS price reduction. It appears that the review of defence contracts announced by Defence Minister Mohammad Sabu shortly after being appointed in May, 2018, has been completed and the first one to be made public, is apparently the deal for the four LMS for the RMN.
The price of the original contract for the LMS was RM1.17 billion, it has now dropped to RM1.048 billion, a cut of some RM122 million. All four ships will also now be built in China instead of two in China and another two in Malaysia as off the original plan.
The latest CGI of the LMS. Note the main gun and containers on the foredeck.
From NST
KUALA LUMPUR, March 15 (Bernama) — Boustead Holdings Bhd (BHB) today announced the revision of terms of contract for the supply of four littoral mission ships for the Royal Malaysian Navy.
In a filing with Bursa Malaysia, BHB said the government agreed that all four vessels would be built and delivered in China at a revised contract price of RM1.048 billion.
BHB was referring to an earlier announcement with regard to the signing of a contract between the Ministry of Defence Malaysia and Boustead Naval Shipyard Sdn Bhd, a subsidiary of BHB, for the supply of four littoral mission ships in collaboration with a partner shipyard in China.
Under the initial contract, the first two vessels would be built and delivered in China and the remaining two would be built and delivered in Malaysia for RM1.17 billion.
Based on the small reduction in the contract cost, it is likely that the equipment originally planned for the ships will remained the same. And the cost of the four ships will still be higher than the three APMM OPVs.
As for the defence contract review, I will write more about it soon.
— Malaysian Defence
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View Comments (22)
Seems obvious where the savings come from.
A win for real defence, instead of the usual crony jobs program
Although it's a shame we cannot just get rid of this incompatible China-made rojak
Reply
The crony is Boustead which is majority owned by LTAT, the military pension fund.
Some reduction, but still it is very expensive compared to any patrol ships china has build for anyone. It is still even more expensive than those DAMEN OPV 1800 being built for APMM (RM246.6 million, vs now price of LMS RM262.5 million)
Anyway if the mindef is serious to reduce cost...
Cancel the Kedah batch 2 project, those 12 more OPVs, even if built to the lower USD150 million target cost, would still cost at least USD1.8 billion overall. Building 12 Damen OPV 1800 for APMM instead would only cost USD672 Million, nearly 1/3 the cost of the proposed lower cost Kedah batch 2.
Swallow our pride, promote the sense of ASEANess and buy MRSS in the form of Makassar class LPD direct from PT PAL. Those ships cost less than USD50 million each.
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There is no Kedah 2 project just the RMN plan. The talk is that despite the seemingly endorsement for 15 to 5 it is unlikely to go much further than the LCS. And there are even rumours about that. I have not got any confirmation on this so I am leaving it at that.
Latest design of LMS looks very nice..already semi stealth.
With all good ideas put forward by Mr ...., I wonder if an decision maker in MinDef read that & put into their consideration.
I strongly believe we will go for affordable purchase.. no more 15 to 5. We will back to rojak... I also believe this is the first n last china made vessels we hoing to have, unless the government change on next election.
BTW india manage to build an even larger 97 meters long, 2,140 tons displacement OPV for half the cost of the LMS! Each of the Vikram-class OPV costs USD32 million each, around RM131 million. This ship is even bigger than TLDM Kedah class OPV, and is similarly armed to the LMS and APMM damen OPV 1800, which is a single 30mm RCWS.
https://www.iastoppers.com/wp-content/uploads/2017/10/OPV-Vikram-iastoppers.jpg
http://www.b4umedia.in/wp-content/uploads/2018/04/006-1.jpg
https://pbs.twimg.com/media/DaeaFCDXcAASHwe.jpg
https://defpost.com/wp-content/uploads/2017/10/ICGS-Vikram-OPV.jp
122 million, what we going to use it? If all build in China, do we still have right build locally in the future? A lot of saving action will end up pay more later like the LRT3 n MRT3. Smaller size train, lesser train...this is our answer n result.
Reply
Many questions no answers at the moment
Quite obvious where the cost savings went: no locally built of the 2 ships here. It may be a cost savings for Mat Sabu but there is the job loss for not building them here.In terms of actual savings: NIL.
@ michael
Yeah, the biggest question is, will the LMS68 continue to be build past the 1st 4 units? There is still possibility of building the next batch in malaysia. Or there is an alternative posibility that it would be ended at just 4 units. Then there would be questions to the MCM capabilities on LMS as the current Mahamiru class minethunters are going to be refitted and life extended.
Boustead already got enough in their hands subject to they continue with Maharaja lela batch 2 or even Kedah batch 2 but highly unlikely. Shoukld there is any further need for LMS, then it should be from original builder dockyard.
If there is a Maharaja lela batch 2 (a very big if), it should be bigger hulls with emphasis on on Anti-Air warfare. The Mica should be replaced with at least the Aster 15 but to offset the overall cost, the hull number should only be 2 to 4.