Australia to Spend Billions of Dollars on Shipbuilding to Overhaul Its Navy

Australia on Tuesday unveiled a blueprint for a larger and more lethal surface fleet for the Royal Australian Navy that would more than double the size of the fleet compared with a prior government plan. The new plan calls for 26 major surface vessels, including destroyers and frigates, plus 25 minor war vessels.

The ships would have various weapons systems including upgraded air defense and strike capabilities, undersea warfare capabilities, and increased long-range strike capabilities. They would complement Australia’s plans to operate eight conventionally armed, nuclear-powered submarines under the three-way Aukus military pact, which includes the U.S. and the U.K., in the coming decades.

The Australian government said an additional 11.1 billion Australian dollars (US$7.25 billion) will be invested in the navy and shipbuilding over the next decade, supporting some 3,700 jobs. The plan focuses on the Osborne shipyard in South Australia and the Henderson shipbuilding complex in Western Australia.

“A strong Australia relies on a strong navy, one that is equipped to conduct diplomacy in our region, deter potential adversaries, and defend our national interests when called," said Vice Admiral Mark Hammond, chief of Australia’s navy. “The size, lethality and capabilities of the future surface combatant fleet ensures that our navy is equipped to meet the evolving strategic challenges of our region."

Australia’s current surface fleet is the oldest the navy has ever operated, the government said. The oldest of the Anzac-class frigates, the backbone of the current fleet, are approaching 30 years of age.

The navy plan comes after a wide-ranging review of Australia’s military last year found that Canberra needed to quickly overhaul its armed forces and focus more on capabilities such as long-range missiles. Australian officials had said the previous assumption that Australia would have 10 years to prepare for a conflict was no longer accurate, amid concerns that China could seek to take Taiwan—the self-governing island that Beijing views as its territory—by force in the near future. Advances in technology had also eroded the advantage of Australia’s relatively remote geography, the review said.

A public version of the navy analysis, released Tuesday, said that a mix of vessels would enable a larger surface combatant force to handle a variety of missions across an extensive area of responsibility. The surface fleet, it said, is a key part of Australia’s strategy to deny adversaries the ability to operate in Australia’s northern maritime approaches—a theater where U.S. Marines have been deployed for annual training in recent years.

The roughly 20-page document, however, didn’t mention China. That likely reflects how Australian officials have faced a delicate balancing act as it deepens its military cooperation with the U.S. while also avoiding to overly anger Beijing, its largest trading partner.

The current center-left government of Prime Minister Anthony Albanese has sought to thaw ties with Beijing, which slapped trade restrictions on a variety of Australian goods in recent years following a diplomatic spat with the prior Australian government. China has lifted some restrictions recently.

Australia has also said that it wants to set up a domestic missile-manufacturing capability at a time when the conflict in Ukraine has stretched the ability of the U.S. and its allies to replenish munitions stocks. The review from last year also recommended that Australia buy more High Mobility Artillery Rocket System, or Himars, units from the U.S., acquire more landing craft and reduce the number of infantry fighting vehicles—indicating the increased importance of Australia’s northern maritime and littoral zone.

Write to Mike Cherney at mike.cherney@wsj.com