Leonardo, Fincanteri revamp joint venture, aiming to trim frigate build time by 18 months

PARIS — Italian defense companies Leonardo and Fincantieri this week announced a restructuring of their Orrizonte Sistemi Navali (OSN) joint venture, which the CEOs of both firms say could trim the time required to build a frigate by 18 months.

The joint venture, which has existed for over two decades, will return to its former model, in which OSN serves as an overarching integrator of an entire warship. The move would effectively change the conglomerate’s current approach, where Fincantieri and Leonardo generally manage separate aspects of the same ship.

The heads of Leonardo and Fincantieri, Lorenzo Mariani and Pierroberto Folgiero, signed a Letter of Intent at the Euronaval defense show here on Tuesday. Executives said the renewed joint venture, in which Fincantieri owns 51 percent and Leonardo 49 percent, would be more competitive in European and export markets. 

“Italy has a strong industrial setup in the naval domain, which enables us to perform effectively and deliver faster than in the past. One of OSN’s key objectives will be precisely to shorten these lead times,” Pierroberto Folgiero, the CEO of Fincantieri, told reporters on the sidelines of Euronaval.

Folgiero said executives set a goal of cutting the delivery window for FREMM frigates from 54 to 36 months, a key “test case” that could determine whether the companies’ combined shipbuilding prowess can deliver a vessel on a timeline similar to the Korean industry.

The joint venture’s roster spans several vessel types, including the Italian Navy’s light multirole offshore patrol ship class, the PPX, and the FREMM EVO, an evolution of the Italian Navy’s European Multi-Mission Frigate program.

In September, OSN additionally signed a contract valued at €3.7 billion ($4.2 billion) with OCCAR (Organisation Conjointe de Coopération en matière d’Armement) for the development, production and initial in-service support for two new-generation DDX destroyers to equip the Italian Navy.

In July, Portugal awarded Fincantieri an approximate €3.9 billion ($4.4 billion) order to build three FREMM EVO frigates, with deliveries planned for 2029-2030. In September, Italy and Greece also finalized an agreement to transfer two Carlo Bergamini-class FREMM frigates from the Italian Navy to Athens, where Fincantieri will oversee the technical transfer and modifications of these warships.

Folgiero asserted that Italian Navy ships are “very well-proven at sea” and represent an important benchmark at a time of significant global demand for naval military vessels. 

“The ships we have built together with Leonardo for the Italian Navy have a proven track record and are therefore well-positioned to benefit from the increased demand for military naval capabilities worldwide,” he said.