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National Reconstruction Fund invests $245 million in Australian shipbuilder Austal Limited to help strengthen country’s military shipbuilding capabilities.
The National Reconstruction Fund Corporation is providing $245 million of debt to Austal Defence Shipbuilding Australia Pty Ltd (Austal Defence Australia (ADA)) to build an advanced manufacturing facility that will enable local production of Landing Craft Heavy for the Australian Army at Western Australia’s Australian Marine Complex.
ADA is a subsidiary of Austal Limited, an Australia-based shipbuilder and Defence prime contractor that specialises in the design, construction and support of defence and commercial vessels.
The Commonwealth of Australia and ADA executed the Strategic Shipbuilding Agreement in 2025, making ADA Defence’s Strategic Shipbuilder in Western Australia.
Under the Agreement ADA has been contracted to manufacture eight Landing Craft Heavy (LCH) vessels by 2038.
The LCH will be capable of transporting more than 500 tonnes of embarked personnel, vehicles and equipment by sea, including long-range precision strike weapons and other units.
This will greatly enhance the Australian Defence Force’s littoral capability, and support humanitarian and disaster relief.
“This investment by the NRFC will strengthen our existing naval shipbuilding capacity at a time when geopolitical shifts are making these vital capabilities increasingly important,” according to NRFC CEO David Gall.
“NRFC investment in LCH manufacturing builds industrial depth that can be re-deployed across future naval programs. It will help to embed vital sovereign naval assembly and quality assurance capabilities onshore, reducing our reliance on offshore shipyards and providing our allies with a strategically important capability as they undertake the large-scale fleet replacement needed to ensure maritime security.”
“Tectonic shifts in the geopolitical environment mean that the global naval shipbuilding market is projected to grow 25 per cent by 2033. As a global leader in shipbuilding, autonomous vessels and hydrogen‑ready maritime platforms, Austal Defence Australia is well placed to capitalise on this market trend.”
NRFC funding will be used to construct and fit out ADA’s AMC facilities with modular manufacturing capabilities to ensure delivery of the LCH project.
Austal already employs around 1,200 people in Australia and NRFC investment in the LCH project is expected to create an additional 780 Western Australia based roles in skilled trades, engineering and advanced manufacturing.
“This NRFC funding supports development of the facilities that are critical to delivering the Landing Craft Heavy program, with significant long-term benefits for both sovereign shipbuilding and local jobs in Western Australia,” according to Austal CEO Paddy Gregg.
“In the spirit of the Strategic Shipbuilding Agreement between the Commonwealth and Austal Defence Australia, all parties are cooperating to drive the success of this critical build program.”
NRFC’s investment is subject to completion of finance documentation and satisfaction of conditions customary for a transaction of this nature.
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