The government's plan for acquiring new submarines makes sense, but a longer time period is needed to seek bids, says peak manufacturing body the Australian Industry Group.
The AiGroup wants a full competitive acquisition, with vessels to be constructed in Australia.
AIG chief executive Innes Willox says the 10-month period for seeking bids from three international partners is “perhaps too short”.
"The decision to include France, Germany and Japan in the government's unique competitive evaluation process for offering design of the new submarines makes sense, although this process falls short of the full project definition study preferred by the industry," Mr Willox said.
Mr Willox said government should also have considered including Sweden in the process.
The Australian Advanced Manufacturing Council also welcomed the announcement of the acquisition strategy.
AAMC chairman John Pollaers said: "The government has made it clear it expects international tenders to show they have the ability to work closely with Australian companies, including in combat system integration, design assurance and land-based testing.
"It is vital that the significant technological work is undertaken here."
Defence Minister Kevin Andrews last week revealed the government's planned approach to acquiring up to a dozen new submarines to replace the navy's six Collins submarines.
The first, HMAS Farncomb, is scheduled to retire around 2025 and the government wants the first of the new boats in service by then to avoid a capability gap.
This will be Australia's biggest ever defence acquisition, costing up to $50 billion over the near half-century life of the program.
The government will invite France, Germany and Japan to submit designs and proposals for construction in Australia or overseas by the end of the year.
This has produced mixed reactions.
Excluded from the process was Sweden, designer of the Collins subs.
Defence company SAAB said they had a demonstrated capability to produce a sub that met Australia's requirements and also to build in Australia.
"If government policy on this matter changes we stand ready to offer our capabilities to Australia and move forward with a proposal," SAAB's Gunilla Fransson said in a statement.
"SAAB is also a supplier of leading edge submarine and underwater subsystems and we are ready to engage in any discussion on these technologies."