The Royal Thai Navy has assured it can review other options if its 13.5 billion baht deal to procure a submarine from the China Shipbuilding and Offshore International Company (CSOC) is deemed untenable, due to the company’s inability to acquire a German-made engine as stipulated in the agreement.
The company, Motor and Turbine Union (MTU), is refusing to supply China with the MTU396 diesel engine that would be used in the S26T Yuan-class submarine because of an embargo that prevents the sale of equipment classified as military/defense items.
According to Navy Chief of Staff Adm Tharoengsak Sirisawat, additional discussions will be held with CSOC near the end of the month to determine whether the issue can be resolved.
“The navy will consider any proposals first, but we also already have in mind some other options,” Adm Tharoengsak said.
It was reported that a German company had refused to supply MTU396 diesel engines to China to be fitted into the S26T Yuan-class submarine being built for the navy.
Navy commander Adm Somprasong Nilsamai, stated that the navy and the Chinese contractor will work to overcome the problem.
Prime Minister and Defense Minister Gen Prayut Chan-o-cha had previously instructed the navy to do everything possible to complete the deal, but said the contract could be terminated should China fail to meet the terms of the agreement.
However The Bangkok Post reported that a source said previously that the CSOC had asked to alter the contract in order to substitute the German engines with Chinese equivalents such as the MWM 620, but, so far, the navy had stood by the terms of the original contract and refused to look at alternatives, although its hand may now have been forced.
According to the source, MTU 396 diesel engines can also be made in China by a licensed manufacturer.