Funding increased for local manufacturers to join US submarine supply chain

The federal government has announced a $19 million investment so far in the Australian Submarine Supplier Qualification (AUSSQ) Pilot. The government awarded HII Australia an initial $9.6 million contract to deliver the pilot phase of the AUSSQ program in March 2025, and has now announced a further investment of $9.3 million to deliver additional work packages.

The initial phase of the program, delivered by H&B Defence — a HII and Babcock joint venture — focused on prospective Australian businesses in castings and forgings, and precision machining. This second tranche of investment will focus on industry uplift activities involving air and gas flasks, and fabricated parts.

AUSSQ is helping local companies become approved suppliers to HII, the largest military shipbuilder in the US and one of two companies that builds US nuclear-powered submarines.

There are currently 22 Australian businesses already taking part, with eight now fully qualified: MacTaggart Scott Australia, Levett Engineering, Century Engineering, H E Parts International, Veem, Hofmann Engineering, Dobbie and MTA.

Further, three of the 22 participating Australian businesses (Hofmann Engineering, Veem and Axiom) have now been invited to quote for work in the US supply chain.

AUSSQ complements the Defence Industry Vendor Qualification Program (DIVQ), and is part of a broader effort to grow Australia’s defence industrial base. These programs are providing hands-on support to help Australian businesses to meet US standards, navigate export approvals, and connect with global supply chains.

This industrial uplift is helping to expand Australia’s submarine industrial base and prepare for the work required to build and sustain Australia’s future fleet of nuclear-powered submarines.

“AUKUS is delivering real benefits for Australian industry and jobs,” said Pat Conroy, Minister for Defence Industry. “This program is helping build a strong, sovereign submarine enterprise that will keep Australia safe for decades to come.

“This $19 million investment is helping Australian businesses break into global supply chains and contribute to allied industrial capacity. It’s about creating jobs, growing skills, and giving our manufacturers a chance to compete on the world stage.”

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