Logistics: Another Battle Between Politics And Economics

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September 3, 2012: The British Royal Navy wants to build four new fleet replenishment ships. These are basically oil tankers equipped to refuel ships at sea while also providing aviation fuel, lubricants, water, spare parts, and other supplies. These ships are 37,000 ton, 200.9 (622 feet) long vessels that also contain a helicopter landing pad.

This project became a political crisis when it became clear that no British, or European, shipbuilder could match the prices (and equivalent quality) of Asian builders. The best bid was from a South Korean firm, who would build the four ships for $711 million, with 20 percent of the work done in Britain. The best European bid was for $950 million, with 35 percent of the work done in Britain. The Defense Ministry wants to take the cheaper South Korean bid but a number of British politicians are willing to pay more to have more work done in Britain. The Defense Ministry officials also point out that the South Koreans are currently the best shipbuilders in the world, especially at specialty type ships. This battle between politics and economics is still unresolved.

 

 


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