L'Usine Nouvelle: interview Guenaël Guillerme, Manager Director of Eca Group about DCNS Contract

Tuesday, May 17 2016
For l'Usine Nouvelle, Guénaël Guillerme describe the ECA Group international business strategy and the importance to be on site in the DCNS Contract.

In the DCNS contract, "a local presence is essential ", according to Guénaël Guillerme (ECA)

Published on the website l'Usine Nouvelle - Myrtille Delamarche - Shipbuilding (civilian or military) - Interview 24 May 2016 - Photo DCNS

An entire industry is holding its breath waiting to know the specific DCNS requirements for the contract for the 12 Shortfin Barracuda submarines being built for Australia. ECA Group (a subsidiary of Gorgé Group) is already working with DCNS in a number of export activities and supplies several components for the Barracuda. Relatively confident concerning the group’s participation in this project, its Director and CEO Guénaël Guillerme describes for Usine Nouvelle ECA’s strategy abroad, for similar contracts.

Usine Nouvelle: How did you react to the news about DCNS winning the contract in Australia for the construction of 12 submarines?

Guénaël Guillerme: Obviously, this news was important to us, who have been working with DCNS for a long time. But we do not yet know the boat’s exact details. As far as we know, it is not a known model, it will be adapted to the customer’s needs. In terms of energy conversion, for example, we do not know how this will be done. It is up to DCNS to inform us of their needs. We will then make a proposal for our services and solutions. But nothing is guaranteed. We must be competitive and relevant. There is still much work ahead.

Which components would your group be able to supply for a submarine such as this variant of the Barracuda?

We supply DCNS with various types of equipment for submarines: steering stations, energy conversion equipment (from electrical power to another, adapted for example to the lighting systems). As well as systems used to reduce the boat’s magnetism. We have also worked on the Barracuda’s electric propulsion motors (1 megawatt). Other than the steering station, all the other components are related to the submarine’s silence, to reduce the noise level, whether it’s acoustic or magnetic. We also manufacture instrumentation and control systems for steering ships, whether they operate underwater or on the surface.

Taking into account Australia’s requirements for local production and the transfer of skills, what are the potential opportunities of this contract for your group?

In the sectors that I mentioned, we are among the companies that work the most often abroad. As such, we systematically encounter this type of issue. Over the past few years, we have supplied solutions for Korean customers who have also required on-location manufacturing and a transfer of technology. This is very often the case in the defense industry: it is complicated to depend on another country for the maintenance and servicing of its ships.

This is why we are present at an international level. 15 years ago, we realized the French market was too restricted for our solutions. We therefore had to be present in the countries where this equipment was being sold, and bring skills into the country.

The ability to meet Australians need for autonomy seems to be one of the arguments that enabled the French offer to qualify…

It is true that in the case of Australia, the requirement of autonomy is especially high. For several reasons, notably related to their geographic isolation, they wish to preserve an autonomy to the fullest extent possible. Fortunately, this requirement can be managed in Australia, which has trained technicians available.

This subject – how far can we go with local production – is always present. In the beginning, the customer country is always very interested. Then very quickly economic considerations come up. If a factory has to be built locally, it’s a very expensive asset and hard to make profitable. You need a little time before both parties realize the extent of the investment. These issues will doubtlessly be worked out in the coming year.

What experience and what presence do you have locally could you showcase to meet this demand?

First of all, ECA is already present in Australia in robotics: we have supplied the Australian Navy with systems for developing autonomous underwater minesweeping vehicles, which previously were not radio-controlled. Afterwards, ECA was very present with DCNS at several tradeshows and events these past few months Australia. Depending on the expected equipment, if the choice is between ECA and other suppliers that are unable to make them in Australia, this will certainly be an advantage.

How can a French company benefit from this contract?

A local presence is essential. In Chili, Brazil, India, Malaysia… in all these countries, we are present alongside DCNS. Two years ago, we decided to double our sales force for this type of ship. We also opened a repair and maintenance facility in Singapore, in order to develop skills locally. The technicians are Asian and trained on our technologies, but it is truly an entity of the ECA Group in Singapore. We will also probably develop a branch office in Australia, with a local industrial partner so that local teams can manufacture and remain in the country.

Interviewed by Myrtille Delamarche

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