German Subs to Cost Twice as Much as Planned

YERUSHALAYIM
Israelis float rubber submarines in the HaYarkon River as part of a protest against Israeli Prime Minister Binyamin Netanyahu, in Tel Aviv on December 11, 2020. (Miriam Alster/Flash90)

The purchase of three submarines from Germany will cost Israel twice the initially projected amount, Globes reported on Tuesday.

Despite the huge cost overrun, the ministerial procurement committee has approved the deal and a formal signing ceremony was scheduled for Wednesday.

The vessels are now estimated to cost €1.2 billion more than originally envisaged. The German government, which agreed to subsidize the deal in the amount of €600 million out of the original price of €1.8 billion, will not raise its subsidy in line with the price increase. The net cost to Israel will thus be twice as high, at €2.4 billion, Globes wrote.

The report did not explain the reason for the change in price.

The three Dakar-class diesel-electric submarines will be built by ThyssenKrupp Marine Systems unit Howaldtswerke-Deutsche Werft AG (HDW) in Kiel, and will start to be delivered in 2027. They will replace three Israel Navy Dolphin 1-class submarines dating from the 1990s.

In a curious parallel development earlier this week, Defense Minister Benny Gantz and Minister of Foreign Affairs Yair Lapid were actively seeking the establishment of a committee to investigate the deal, which has been clouded for years by allegations of corruption that have resulted in several indictments.

Sources in the government told “Globes” that the Germans were aware of the proposed inquiry but raised no objections and agreed to assist in the probe.

 

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