Make or break: Can the European Patrol Corvette programme save shipbuilding in Europe?

The European Patrol Corvette (EPC) programme has been gradually gathering momentum. With heavy political backing and new financial and project management structures in place, it is hoped that it can become the model for future acquisition by breaking down engrained national preferences and moving towards a genuine European procurement process.

Since its launch in November 2019, the EPC project has expanded and now boasts involvement from six countries, with initial leading partners in France, Italy and Spain joined by observers from Denmark, Greece, Norway, Ireland, Romania and Portugal.

Under a contract signed on 24 October between Europe’s Organisation for Joint Armament Cooperation (OCCAR) and an industrial consortium comprising Naviris (the joint venture between France’s Naval Group and Italy’s Fincantieri) and Spain’s Navantia, work will begin on an initial 24-month phase to generate the initial design for the European Patrol Corvette.

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This initial phase of what is known as the Modular and Multirole Patrol Corvette (MMPC) contract has been funded to the tune of €87 million (US$91 million). Of this amount, €60 million will come from the European Commission via the European Defence Fund (EDF) – which provides financial support for specific collaborative projects – with the remaining €27 million provided by the six partner countries.

More funding is expected in due course. The intention is to provide a ship of about 100m-long and 3,000 tonnes from the 2027 timeframe.

Isabella Antinozzi, a research analyst at the Royal United Services Institute (RUSI), told Shephard: ‘If this works, we are likely to see increased support in future programmes. The EU’s financing of defence through these mechanisms is quite new and EU policymakers might be waiting for success stories before increasing the funding to more substantive levels. We are witnessing quite an interesting trial phase.’

An early artist’s impression of an EPC design from the Spanish Navy highlighting the capabilities of a ship expected to carry out maritime security patrol, fisheries protection, humanitarian assistance and disaster response and secondary anti-surface warfare missions. (Image: Spanish Navy)

Questions remain, however, about whether the EPC will be able to deliver considering the multitude of industrial and political priorities across Europe. Construction and integration work will be shared across some 40 companies within the consortium located in 12 countries.

Antinozzi said that, as a rule of thumb, for collaborative defence projects to succeed they need a key leader and a degree of compatibility among the countries involved.

‘To date, the EPC programme exhibits these characteristics with Naviris adopting the role of clear leader of the consortium and benefiting from the complementary strengths of both Naval Group and Fincantieri,’ she said. ‘Industry insiders suggest Naviris could surpass mere coordination, potentially leading to a more integrated sector, aligning with the joint venture’s establishment objective.’

Antinozzi added: ‘For continued success, it is important that partner nations won’t prioritise national sovereignty objectives through duplicated assembly lines and work allocation arrangements based on juste retour.’

Juste retour is the principle by which each country demands a fair return on its share of investment. In the EU context it often means that each national government only makes funding contributions towards the workshare that backflows into its own industries. This increases costs and reduces competitiveness.

‘A workshare based on market-driven competitiveness criteria (the rationale underpinning Global Combat Air Programme) will be key in ensuring [EPC] programme delivery to date budget and on time,’ Antinozzi said.

The rear view of the Spanish Navy drawing of the EPC highlighting a medium helicopter capability, along with VLS cells for air defence and a main gun and anti-ship missiles for anti-surface warfare. No anti-submarine warfare capability is anticipated. (Image: Spanish Navy)

While the European Defence Agency (EDA) initiates cooperative programmes, it is OCCAR that manages the following stages of the programme lifecycle. Jointly, both organisations aim to manage and support OCCAR-led initiatives. The EPC is also an EU Permanent Structured Cooperation (PESCO) project. PESCO provides a framework and secures binding commitments from participating member states to support common projects and deepen collaboration.

‘OCCAR employs a method of qualified and adaptable voting for crucial choices, enabling quicker decision-making processes,’ Antinozzi said.

‘It moves away from what it terms as the meticulous assessment of industrial juste retour and adopts a strategy termed as the “global balance”. This approach focuses on achieving an adaptable equilibrium across multiple programs and years, balancing work distribution against cost allocation in a comprehensive and flexible manner,’ she explained.

EU-level funding direct from the EDF incentivises the move away from the juste retour habit, but ultimately it is only a driving force at the political and strategic levels that can bring about success.

‘Financial incentives should not be dismissed altogether,’ Antinozzi added. ‘The support of the European Commission via the EDF gives the programme a strong European flavour and creates more pressure to make it work.’

Propulsion options include both CODAD and CODLAD layouts with maximum speed and endurance around 20kt and 20 days, or 24kt and 30 days, respectively. (Image: Naviris)

Success with the EPC project is essential for Europe when considering the competition in the international naval shipbuilding market.

‘In recent years, Europe has seen continued competition among shipyards and a profound transformation of the EU naval market may be necessary to maintain strategic autonomy and counter acquisitions by non-EU entities,’ Antinozzi said.

‘This holds particular significance as competitors secure market shares, and the Ukrainian War’s impact on capability shortages might divert attention from naval programs, risking previous progress,’ she explained. ‘Even though the specific path and outcomes remain unclear, a significant overhaul of the EU naval market might be the sole recourse for European nations to safeguard their strategic independence and prevent takeovers by non-EU entities.’

Two variants are anticipated – a Long Range Multipurpose ship and a Full Combat Multipurpose ship – as a way of addressing naval requirements with a single hull that is supposed to replace the wide variety of existing ships within the navies of France, Italy, Greece, Spain, Denmark and Norway.

The EPC is expected to replace the Italian Navy’s two Sirio-class and Cassiopea-class offshore patrol vessels; the Spanish Navy’s four Serviola-class patrol boats and six Descubierta-class corvettes; and the French Navy’s six Floreal-class light frigates. Greece’s Hellenic Navy has a wide variety of ageing surface combatants that need replacing from light frigates through to fast-attack craft and patrol boats.

A significant amount of design work will be needed to ensure that the capabilities needed by the navies of participating countries from a corvette can be met through one or either of the EPC variants. (Image: Naviris)

‘The EPC seems to be so far designed as to allow for tailoring each vessel to meet the distinct needs of participating countries’ navies,’ Antinozzi said. ‘Variations in dimensions, sensors and propulsion systems are anticipated, and the EPC’s ample flexible space allows for mission reconfiguration by modifying equipment or onboard systems between tasks.’

She added: ‘A modular and adaptable design is crucial, also in light of the project taking place within the PESCO umbrella. Indeed, PESCO embodies the concept of “differentiated integration” and it’s a particularly versatile framework for programmes exhibiting modularity and flexibility in their design.’

Ultimately, this is a test for the PESCO framework. Existing defence projects using the PESCO procurement route are mainly small-scale, systems-level acquisitions. A few projects such as for a new medium helicopter, artillery system and an infantry fighting vehicle project are significant, but procuring large naval platform presents a challenge of the higher order.

There is a lot riding on the success of the EPC, not just in terms of delivering the right capabilities for European navies, but for the EU’s future cooperation on defence and security. As competition from non-EU countries increases, the need for a reinforcement of Europe’s defence industry through common procurement processes will become essential.

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European Patrol Corvette (EPC) [Spain]

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European Patrol Corvette (EPC) [Italy]

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