Canada has second thoughts about costly F-35 Lightning

O Canada, land of "peace, order and good government." Land of compromise and polite politics. Land of turmoil over whether to buy the F-35.

 

As in the United States, the fighter plane has become a rancorous political issue. What once looked like a sure buy of 65 planes has been bogged down by infighting and un-Canadian vitriol, and the purchase is on hold while Canadian officials consider whether to buy another plane.

 

The F-35 Lightning II is a U.S. plane, made by a U.S. company for the U.S. military. But if the cost for U.S. taxpayers is going to come down to levels that make the plane affordable in the long term, the Pentagon is depending on foreign governments to buy the F-35 as well.

 

From the beginning of the program, Defense Department officials signed up eight international partners, including Canada. Since then, they've crossed the globe looking for additional foreign government customers with some success. Japan and Israel have agreed to buy some of the planes, while South Korea appears likely to make the F-35 its next fighter jet as well.

 

But as Canada shows, not everyone is sold on what has become the most expensive weapons system in U.S. history. In addition to being a symbol of power, might and mind-bending technology, the next-generation Joint Strike Fighter (JSF) has, to some, come to represent waste and unwieldiness — in the United States and abroad.

Many thought that by now Canada would have decided whether to buy the planes — a move that would help drive down costs in the nearly $400 billion program — or instead force the plane's manufacturer, Lockheed Martin, to compete for its business. But it's now unclear when that will happen.

 

Some fear that if nations such as Canada balk, there could be questions about the long-term affordability of the program. Meanwhile, Boeing, one of Lockheed Martin's fiercest competitors, has pounced on what it sees as an opportunity in Canada and other countries to tout its F/A-18 Super Hornet as a proven, affordable alternative.

 

 

Facing budget constraints, Italy and the Netherlands have already curtailed the number of F-35s they said they plan to buy. Denmark is holding a competition that would pit the F-35 against other fighters. Meanwhile, the production line at Lockheed Martin's Fort Worth, Texas, plant has been limited to a little over 30 the past two years, as tightened U.S. budgets and technical problems have forced the Pentagon to significantly slow its procurement as well.

 

"The program is stuck in low production rates and high costs," said Richard Aboulafia, an aerospace industry for the Teal Group. "The production rates are low because costs are high and costs are high because production is low."

 

Currently, the plane's so-called "flyaway cost," which doesn't include research and development, among other things, is approximately $110 million apiece for the Air Force's model, the company says. But Lockheed and Pentagon officials say it could be lowered to less than $80 million by the end of the decade. Lockheed and some of its subcontractors are investing $170 million to reduce the price.

 

Still, the Government Accountability Office recently said that affordability "remains a significant concern" and that "the program is likely to be challenged" to meet cost reduction goals.

While ramping up production would bring the per-plane cost down, it would be unwise to build too many too soon because not all of the necessary testing has been done on the aircraft, said Todd Harrison, director of defense budget studies at the Center for Strategic and Budgetary Assessments.

 

Additional testing will inevitably reveal problems that need to be fixed, which then cost money to repair, he said. For years, critics of the program, including Sen. John McCain, R-Ariz., have said that the United States should never have committed to buying the plane while it was still being developed, saying it violated one of the basic rules of airplane acquisition: "fly before you buy."

 

"It gets to the fundamental tension within the JSF — you want to buy more of them because the quicker we buy them, the cost will come down," Harrison said. "But the faster we buy them, that just increases the concurrency in the program. We're buying planes that haven't completed testing and are going to require modifications."

 

The slowed production rate could have another consequence he said.

 

"One of the concerns has been as we've reduced the production rate, people have floated the idea of cutting back on the number of planes the U.S. is going to buy. Then you spook the allies."

But with the relatively large numbers of aircraft the United States plans to buy, he said, "the fate of the program is up to us, not them." Though the Pentagon initially planned to buy 2,852 planes, it has for years remained consistent with its commitment to buy 2,443. Britain, which plans to buy 138 planes, the most of any other nation, also said its confidence in the program remains strong even though the F-35 was grounded after a recent engine fire and missed its international debut at a pair of air shows in England last month.

 

And at a recent "rollout" event in Fort Worth, Australian and U.S. officials celebrated the anticipated delivery of its first two planes. During the ceremony, Air Marshal Geoff Brown, chief of the Royal Australian Air Force, called the F-35 a "revolution" and said it will cause a "step change in the way we prepare for and conduct operations into the future."

 

Lockheed Martin officials are confident that more countries will sign on in the years to come as the need to replace their fighter fleets becomes more urgent. The F-35 is designed to supplant several different legacy aircraft, from the F-16 to the F/A 18 and the A-10.

 

"This is the airplane that's going to replace all those airplanes and create a capability for the next 50-plus years," said Steve O'Bryan, Lockheed Martin's vice president of international strategy and business development.

 

Replacement of the F-16 alone creates a huge market for the F-35, he said. More than 4,500 F-16s have been built, and nearly 30 countries use the aircraft.

 

And while not all of those F-16s will be replaced, "the potential is significant," he said.

 

Potential customers are one thing. Signed contracts are another.

 

It initially appeared as if Canada was definitely going to buy. Defense officials praised the F-35's speed and stealth. At a news conference announcing the purchase to buy 65 F-35s in 2010, then-Defense Minister Peter MacKay called it "the best that we can provide our men and women in uniform."

 

But two years later, the government put the acquisition on hold after an auditor general's report suggested the government misled Parliament, saying that key costs over the course of the fleet's life were much higher than previously stated.

 

Liberals attacked the conservative government. John McKay, a member of Parliament, called it "deceit and incompetence at the highest levels." Another member, Ralph Goodale, wrote that the "F-35 fiasco exposes dishonesty and incompetence."

 

As a result, the Harper administration, while denying it misled Parliament, put the purchase on hold and appointed a National Fighter Procurement Secretariat to ensure the Canadian military acquires the right plane.

 

But Goodale thinks that the government will put off any decision until after the upcoming elections. "This is a hot potato for them," he said. "Their process up to now has been terribly flawed, and they have very little public support for how they've gone about this."

 

The cost has been a big issue, and there was also "concern here in some circles that the F-35 was the anointed choice without having gone through the formality of a competitive process," said Martin Shadwick, a Canadian defense analyst and a professor at York University.

 

Still, he said, "My personal anticipation is that we'll still buy."

 

But Boeing is doing everything it can to change minds.

 

"We certainly believe the Super Hornet is very well-suited for the unique environment and geographical challenges faced by the Royal Canadian Air Force," said Howard Berry, Boeing's F/A-18 international business development team leader. "We continue our battle rhythm. We continue to engage our political colleagues on both sides of the aisle."

Canadian Forces quest to obtain unmanned aerial vehicles – 10 years and counting

The Canadian military’s almost decade-long quest to buy unmanned aerial vehicles has been partly hung up by an internal debate about whether the air forces needs one — or two — different fleets of drones, the Canadian Press news service has reported.

 

A series of internal briefings, stretching back over two years, show that military planners were forced to go back to the drawing board in early 2013 after consultations determined what the country wants to accomplish with the remotely piloted planes might be too broad for just a single type of aircraft, the news service noted.

 

The military expects the drones to not only provide surveillance at home and abroad, but also carry weapons, such as Hellfire missiles, for precision strikes during overseas missions, the Canadian Press reported added.

 

The CP report dovetails into an article that I had in May. In that article, I reported that the Canada military hopes to have a fleet of drones fully operating by 2023.

 

But even that 2023 date is tentative as the government still has to approve the project to buy the unmanned aerial vehicles, also known as UAVs.

 

More from that article:

 

Military staff privately acknowledge that the plan to buy the pilotless aircraft to conduct surveillance off the country’s coasts, in the Arctic and on overseas missions, has fallen behind schedule because of a lack of money and lack of personnel to staff the new squadron.

 

At the time, the RCAF declined an interview on UAVs. Air force spokesman Maj. James Simiana stated in an email that “this project is still pre-definition phase and pre-Government announcement.”

 

But in an April 10 presentation in Ottawa, Col. Phil Garbutt told industry representatives that the project is still a priority and one of the “Big 5” the air force wants to push in the future. He noted the RCAF hopes for the first UAVs to be available for operations in 2021 and that all drones, personnel and infrastructure would be in place by 2023.

 

Details of Garbutt’s presentation were provided to the Citizen.

 

But industry representatives privately question whether that timetable will be kept, noting there has been little movement on the project, estimated to cost more than $1 billion.

 

In his presentation Garbutt acknowledged the dates for the project, dubbed the Joint Unmanned Surveillance Targeting and Acquisition System (JUSTAS), were “notional.”

 

The first of the UAVs were supposed to be operating starting as early as 2010. That was then pushed back to early 2012 and again changed to 2017 by military officers as they dealt with ongoing delays to the project.

 

In 2012 the Citizen reported the RCAF had determined it needed 369 people if it wanted to create a new squadron for unmanned aircraft as promised by Harper. Finding those individuals was a problem, according to the military.

 

Canada has operated UAVs previously. During the Afghan war, the government approved the lease of Israeli-built UAVs from MacDonald Dettwiler and Associates in Richmond, B.C. Those unarmed aircraft operated out of Kandahar airfield.

 

During the Libyan war in 2011, senior Canadian defence leaders pitched the idea of spending up to $600 million for armed drones to take part in that conflict.

 

Documents obtained by the Citizen showed that military leaders saw the Libyan war as a possible way to move the stalled JUSTAS program forward. According to a briefing presented to then Defence Minister Peter MacKay, they pointed out the purchase of such aircraft for the Libyan conflict could kick-start their larger drone project.

 

The war, however, was in its final stages when the briefing was provided and the proposal didn’t get approval from the Conservative government.

 

The Canadian Press report has further details:

 

One briefing, prepared for former associate defence minister Kerry-Lynne Findlay in early 2013, says five of eight companies that responded to a request for information in the fall of 2012 proposed a mixed fleet.

 

The documents show the federal government was prepared to spend to up $3.4 billion to buy and service military drones over 20 years, but those numbers are being revisited because of the delay.

 

With the political firestorm over the F-35 stealth fighter in mind, the Privy Council Office, the bureaucratic wing of Prime Minister Stephen Harper’s office, told the military it wanted to see three viable, “fully costed options.”

 

The documents, obtained by The Canadian Press under access-to-information legislation, also show that the air force has tried and failed six times since 2005 to acquire either a permanent fleet of drones or temporary capability.

 

It did succeed in getting a small fleet of Israeli-built Herons for operations in Kandahar, but that was only because the Manley commission, which examined the war in Afghanistan, made it a condition of Canada’s continued involvement.

 

The leased aircraft were handed to the Australians following the end of Canada’s Kandahar deployment in 2011.

 

Drones are becoming ubiquitous not only in many modern militaries, but commercially.

 

The fact National Defence hasn’t been able to get its act together shouldn’t be surprising given the budget restraints imposed on it, said University of Ottawa defence analyst Philippe Lagasse.

 

The air force’s budget and expectations for replacement aircraft are often directed toward single fleets and having industry come back to say expectations don’t match the technology must have thrown officials for a loop.

 

“Should it be going faster? Sure,” said Lagasse. “Is it easy to do? No.”

 

It is hard to move faster when National Defence has been saddled with so many competing projects and no overarching policy guidance, he added.

 

A rewrite of the government’s defence strategy has been in a holding pattern before cabinet since late last fall.

 

The newly released documents underscore the importance of drone technology, describing it as a “critical enabler” without which surveillance of the country’s vast expanses “will be less effective.”

 

The absence of unmanned aerial vehicles is also being keenly felt as the military looks at other nations and sees what it could be doing — especially on the domestic front where it has been called upon to deal with the aftermath of floods and storms.

 

“Had a (UAV) capability existed it would have been utilized in most, if not all, recent natural disasters,” said an April 2013 slide presentation drawn up by the project management office.

3 Fighter Focus: Eurofighter and Gripen Analyzing the pros and cons of two contenders vying for the title of Canada’s next generation fighter.

No one disputes the fact that Canada needs to procure new fighters, but that’s where universal agreement ends. Several aircraft types are competing to be Canada’s next fighter jet. In this ongoing series, defence analyst Richard Shimooka examines the pros and cons of each contender. In this installment: the Eurofighter Typhoon and the Saab Gripen.

Eurofighter  (Tranche III)

The Eurofighter Typhoon is a multinational fighter program between the United Kingdom, Germany, Spain and Italy. It was originally conceived in the early 1980s to provide West European states with a new air superiority fighter. However, the project was plagued by serious delays and cost overruns during its development, only entering service in 2002. Part of the issue was managing a massive multinational project with a highly defined work share agreement. Currently, the Typhoon is in service with the four partner nations, and won export orders to Austria (2002), Saudi Arabia (2006) and Oman (2012). In total, 559 will be delivered by the current projected end of production, sometime after 2017. Each partner nation possesses a production line, but a Canadian purchase would likely be supplied by BAE Systems’ facility in Warton, UK. 

The Eurofighter Typhoon is a multinational fighter program between the United Kingdom, Germany, Spain and Italy. The European fighter is currently in service with seven different air forces. Eurofighter Photo

 

Capability and Performance

Of all the fighter options likely to be considered by the RCAF, the Eurofighter offers the best overall aerodynamic performance. This was due to the aircraft’s original design requirements. By 1980, the Soviet Union had fielded a new range of fighter aircraft, including the Mig-23, Su-27 and Mig-29. These agile supersonic aircraft and their expected successors were greeted with alarm by European air forces, as they feared they could wrest air dominance from the current generation of western fighters.

In response, the Eurofighter was designed with phenomenal aerodynamic capabilities, including exceptional range, top speed, and maneuverability. Limited consideration was given to air-to-ground capabilities, at least for the initial operating versions. Instead, the Typhoon excelled in two areas: high altitude supersonic regimes for launching long-range missiles, and transonic maneuverability for close-range combat. Its operational range for a long-range northern intercept is likely in excess of 750 nautical miles (nm) based on figures given to the Norwegian government. To achieve this performance, the Eurofighter utilized a somewhat novel delta-canard wing that provided very high levels of agility and lift. Furthermore the aircraft was constructed with a then-unprecedented level of composite materials, which reduced its overall weight. Approximately 40 per cent of the aircraft’s structural weight was made up by composites, compared to 20 to 25 per cent for most contemporary fighters. Finally, the Eurofighter utilizes the Eurojet-200 engine, a powerful high-bypass turbofan developed by the partner states. These aerodynamic advantages were supplemented by its advanced avionics suite, which would allow it to operate in the then-existing high threat environment. It is highly ergonomic and possesses significant sensor fusion capabilities that provide the pilot with great situational awareness, a key advantage over most potential opponents. An example of this is the Defensive Aid Sub System, which is a collection of avionics that identifies incoming missiles, suggests pilot action and automatically deploys applicable countermeasures.

Yet, the initial design choices also had significant consequences for the fighter’s capability. Minimal consideration was given to stealth capabilities, as European states’ research into low observable technologies was in its infancy. This will constrain its ability to operate in future high threat environments against newer generations of lethal surface-to-air missiles and air superiority fighters. In addition, the aircraft’s ground strike capabilities were non-existent until recently; only a handful of RAF Typhoons were able to drop precision-guided munitions with the aid of an older Tornado fighter designating the target. A full suite of air-to-ground capabilities will be delivered with the Tranche III production lot, which should start deliveries later this year. However, even with these enhancements, questions on the Eurofighter’s effectiveness remain. A 2009 Swiss Air Force report evaluation rated the fighter as unsatisfactory for the air-to-ground strike, citing several technical deficiencies in the proposed Tranche III capability.

Of greater concern is the availability of spares for the aircraft. A 2011 UK National Audit Office report identified parts supply problems as a key factor in the unavailability of RAF aircraft for basic operations. In particular, the report stated: "Separate to these two support contracts, there are indications of problems with the collaborative contracts for the supply of spares and repair of equipment. There have been shortages of spares and long timescales for equipment repairs on some of these contracts. To compensate, the Department has had to take parts from some of its Typhoon aircraft to make other aircraft available to fly."

These problems may become even more apparent with a Canadian purchase, since it is not a partner in the Eurofighter consortium. The physical distance between Canada and the European continent could further increase delivery times. Unless Canada would accept a lower level of availability in such a scenario, Canada will either need to purchase additional aircraft to meet its operational commitments, or make a significantly larger purchase of spares than usually required. 

Contract Price and Industrial Benefits 

The Eurofighter is one of the most expensive fighter aircraft available on the international market. The inherent advantages of a multinational production scheme have largely been diluted due to poor management decisions and inefficient manufacturing practices. For example, the potential for manufacturing learning on a large production line was severely reduced due to the separation of assembly to four national facilities and set workshare arrangements. Consequently, the per-unit flyaway cost is approximately C$115.5 million (in 2011), which is the highest among all of the aircraft currently under consideration.  In addition, an export levy is often applied to any UK export, which may add several million dollars to the per unit price. It is unlikely Canada would be able to procure a sufficient fleet of aircraft within the government’s stated $9 billion acquisition cap. 

The Typhoon’s operational cost is similarly high. In 2011, the UK Ministry of Defence (MoD) stated the per-flying hour cost of the Eurofighter as approximately C$110,000. Due to differing accounting practices, this figure is not directly comparable to American figures, and MoD officials have suggested it will decline over the next decade.  Nevertheless, other partner states have similarly noted the Eurofighter’s high cost, including Germany, where it was double the original estimates.

The domestic industrial offset opportunities are likely to be in line with other defence procurements, but with significant limits. First, the fixed collaborative workshare arrangement among the Eurofighter partners and the aircraft’s maturity effectively preclude any participation in the program. Thus, any direct offsets would be limited to the RCAF’s purchases. However, it might be possible to secure significant indirect offsets from BAE Systems or other Eurofighter partner firms such as EADS (the parent company of Airbus.) This, like Boeing’s F/A-18E/F, would likely involve subcontracting on civil airliners for the company’s Airbus division. 

Future Prospects 

A Canadian order would be from the Tranche III production block, which would possess the CAPTOR-E AESA radar and full air-to-ground capability. The latter includes a wide range of air-to-ground weapons commonly used among NATO forces. Tranche III would represent the most capable version of the Eurofighter, and provide a high degree of operational interoperability with Allied forces. Yet, the program’s future prospects are somewhat clouded after that point. The overarching problem surrounds the political and fiscal situation among the partner countries. Deep austerity measures being implemented and the lack of a direct threat has significantly diminished defence spending across Europe. This affects the Typhoon in several different respects. 

Despite its troubled beginning, the Eurofighter Typhoon is finally making a name for itself in the air-to-air role, and now the strike role. RAF Photo

 

First, the Eurofighter does not have a continual (or spiral) improvement process for its systems, unlike the Super Hornet or the F-35. Upgrades are developed into large tranches, which must be collectively agreed to by partner countries. This has been an issue in the past, as states disagreed over funding-specific capabilities. The RCAF may one day face the dilemma of joining an upgrade that might not meet all of its needs or, more likely, be forced to develop key capabilities alone. The latter may not be a financially viable prospect: the high cost of upgrading the first tranche of fighters almost led the RAF to scrap the fleet after only 12 years of service.

Yet, future upgrades are not the only pressing concern. As noted earlier, the Eurofighter suffers from high operational costs and low availability, due in part to inefficient multinational arrangements. While the aircraft is set to become the main fighter for Germany and Spain, Italy and the United Kingdom are also partners in the Joint Strike Fighter program. It is quite possible the latter two may prematurely abandon the Eurofighter in order to purchase the more robust capabilities of the F-35. If the fleet is flown at lower rates due to budget cuts, or fewer countries operate the type, the spares availability issue will only worsen as producers shift production to more profitable ventures.  

Overall, the Eurofighter offers a difficult choice for Canada. Certainly, it is among the most capable aircraft available and would be an asset for the RCAF, particularly in regards to defending the North. Yet, its high costs, complex management arrangements and limited capabilities in some areas should be a serious concern in any competition.

 

Gripen NG  (JAS-39E/F)

The Saab AB Gripen NG (Next Generation) is considered a versatile multi-role fighter, providing a low cost alternative to other major Western designs. It is currently under development with two customers – Switzerland and Sweden – for a total of 82 fighters currently planned. The program has already been beset by cutbacks: the Swedish parliament has reduced the number of planned purchases from 80-100 aircraft to 60. Moreover, at the time of writing, the Swiss parliament had suspended its air force’s purchase. If the project does move forward, initial deliveries are planned for 2018.

If all goes as planned, the first multi-role Gripen NG will enter service in 2018. Overall, the Gripen NG could offer a versatile set of capabilities to Canada. Saab Photo

 

Capabilities

The Gripen NG is currently in the initial development stages, after Riksdagen (the Swedish Parliament) approved the purchase of 60 aircraft. The original Gripen A/B was intended to be a lightweight replacement for two other Saab fighters, the Draken and Viggen. It was a light, agile aircraft, with impressive performance features. In particular, it had exceptional short-range takeoff ability, so that it could operate from unprepared road surfaces in Sweden. It was also extremely affordable, both to procure and operate. The JAS-39A/B/C/D was a moderate export success, with 240 produced between 1993 and 2012.

The JAS-39 E/F builds on the original Gripen, much like how the F/A-18E Super Hornet is an updated and enlarged version of the F/A-18C Hornet. Ironically, it follows the same engine evolution: the Gripen A/C employs a modified GE F404 engine (currently on the F/A-18C); while the Gripen E/F has a GE 414 engine (currently used by the F/A-18E/F). The project attempted to leverage existing technologies or proven suppliers where possible, in order to decrease the development risks facing the program. 

Overall, Gripen NG should offer a versatile set of capabilities to Canada. Its AESA (active electronically scanned array) radar and other sensors will provide good situational awareness, which can be augmented with external sensor pods. The Gripen will have significant organic sensor fusion capabilities, and be able to integrate with NATO operations through Link-16 datalink. The Gripen NG will also be equipped with a Saab proprietary data link that allows for effective battlefield networking between most Swedish-built military aircraft. However, it is not available on any other aircraft, limiting its interoperability to other buyers of Saab products. 

JAS-39E/F’s aerodynamic performance should roughly resemble that of its predecessor, but with some differences. Saab claims the Gripen NG’s long-range air-to-air combat radius is 700 nautical miles (nm) with a 30-minute loiter period. However, this range can only be achieved by loading the aircraft with large fuel tanks, significantly degrading other aspects of flight performance. A Swiss air force evaluation suggested the Gripen NG could remain aloft for only 66 per cent of the Eurofighter’s and Rafale’s time in the air, with a representative combat load for air to air combat. 

Developed by the Swedish aerospace company Saab, the single-engine JAS 39 Gripen is currently in service with five different air forces. Switzerland is the latest country to order the Gripen (JAS 39Es) to replace its F-5 Tigers. Saab Photo

 

The Gripen NG’s largest deficiency is its ability to undertake operations in a denied airspace. The aircraft has only a few low observable features, which will leave it vulnerable to newer generations of air defence systems. Its combat capabilities, including electronic countermeasures and weapon capabilities, are unlikely to exceed that of the F/A-18E/F, given that aircraft’s continual spiral development process. Efforts to keep the Gripen combat capable will also face significant challenges. With no traditional allies planning to adopt the type, Canada may have to shoulder the entire cost and risk of any unique upgrade deemed essential for maintaining its combat effectiveness.  Moreover, as noted above, any appreciable weapon capacity must be carried externally, decreasing range and aerodynamic performance. These factors led Saab AB representatives to suggest that Canada consider a joint purchase of F-35s and Gripens during a 2010 parliamentary hearing. The former would be used mostly for expeditionary warfare, with the latter dedicated to responding to domestic contingencies and operations in less contested airspace. 

Cost and Industrial Competition

Unfortunately, the Gripen suffers from a problem shared by many Western fighters: an inefficient production scale. With only two confirmed clients and relatively small orders, Saab cannot create manufacturing learning curves or economies of scale that would drive down costs. Moreover, the NG is in a very early stage of development, with over 70 per cent of the aircraft’s systems requiring development from the Gripen C. Already Saab’s cost estimates have increased significantly. In 2010, company representatives stated the aircraft’s per unit flyaway cost would be US $57 million dollars (in 2012 dollars). In 2012, this was revised to approximately US$80 million, only then to reveal that the Swiss government’s fixed cost is approximately US$105 million. Similarly, operational costs estimates have also witnessed significant escalation. In 2010, company representatives stated the Gripen NG’s per flying hour cost would be around US $5,000. Yet Saab has now increased this to US$10,000, and the Swiss military has estimated their costs at approximately US$21,000. 

Saab AB has in the past reinvested up to 120 per cent of a contract value into a country as part of an offset package. In addition, it offered to provide complete technology transfer and the option to establish production lines in Canada. However, the latter two are of limited value for Canada. Domestic production will drive up the per-unit costs, as a Canadian line would only manufacture aircraft for the RCAF and never really achieve efficiencies that the Swedish line would. Moreover, technology transfers are unlikely to substantively benefit Canadian industries, as much of the research is only valuable in relation to the Gripen program. It may have some advantages for the RCAF’s ability to maintain and upgrade the aircraft indigenously.

Any direct industrial opportunities on the fighter will likely be limited to the aircraft purchased by the RCAF. Thus, most of the offsets will be indirect in nature, with investment made on projects unrelated to the Gripen’s procurement. Unfortunately, Saab AB has a relatively small industrial relationship with Canadian companies. Thus, it will find difficulty meeting its offset commitment, almost certainly resulting in a lower quality of industrial benefits that are not sustainable for Canadian industries. 

Future Prospects

Saab AB has offered the Gripen NG to several countries, including India, Denmark, Norway, Brazil, the Netherlands and Switzerland. It has thus far only secured two orders: Sweden and Switzerland, with the Danish competition still ongoing. RCAF deliveries would likely start after 2019 if selected, which would easily fit within DND’s planned budget programming and transition plan.

Looking ahead, the Gripen NG seems to have carved out a narrow niche as an affordable versatile lightweight fighter. However, its position is under threat from new competitors in the market. First, the “low” end of the fighter market is becoming increasingly competitive, with new offerings from Korea and other states. Second, Gripen faces tough competition at the “high” end of the market from the Joint Strike Fighter. Given the F-35’s capability and the NG’s high cost (US$80-105 million versus approximately US$95-105 million for a non-partner F-35A), many potential operators may chose to go with the more expensive capability. This situation may leave Saab with fewer market prospects than it enjoyed with the original Gripen. 

Conclusion

If the program is implemented and goes according to plan, the Gripen NG should provide an affordable, relatively low risk capability for the Canadian Armed Forces. Yet as successive military development programs have suggested, these estimates may not come into fruition. Moreover, the Gripen NG has significant capability deficiencies, which may come as a detriment to the RCAF’s ability to undertake foreign operations in the future.   

Richard Shimooka is a defence analyst with the Conference of Defence Associations Institute. Between 2007 and 2012 he was a fellow at the Defence Management Studies Program at Queen’s University, and is a member of the International Institute of Strategic Studies. Richard recently released a report on the F-35 with the CDAI, entitled “Towards an international model for Canadian defence procurement? An F-35 Case Study.” He lives in White Rock, B.C.

National Defence expected to lose some F-35s before all 65 delivered

National Defence scientists predicted in 2011 that the military would have almost certainly lost several of its brand-new F-35 stealth fighters before all 65 were even delivered, Postmedia News has learned.

In December 2011, the Defence Department’s research arm, Defence Research and Development Canada, published a report in which it said “that the probability of having 63 or more (F-35s) remaining at this time (when the last one is delivered) is approximately 54 per cent.”

Canadian military planners had originally expected to take possession of all 65 of this country’s stealth fighters over a staggered six-year period ending in 2022.

The DRDC report, obtained through access to information legislation, appears to also show how many F-35s the military could expect to lose over various time periods, but that information has been blacked out.

National Defence and the Conservative government have resisted budgeting for extra aircraft at the outset because doing so would push the estimated cost of acquiring the F-35 beyond the $9-billion envelope set aside for the purchase.

Instead, the government has made a vague statement about having “retained the option to purchase, or not, replacement aircraft in the future” — even though the report indicates the military would be short of the minimum required aircraft even before the entire fleet is delivered.

Former chief of defence staff Walter Natynczyk and former Royal Canadian Air Force commander Andre Deschamps both previously said 65 F-35s is the bare minimum required to meet the military’s requirements.

The DRDC report says the reason Defence Department scientists predicted the military would lose a number of F-35s in the first few years of operation is because “the rate of losses for any (fighter) aircraft fleet is … higher at the beginning of the fleet’s service life.”

The report adds that the rate of loss generally drops as the manufacturer learns more about the aircraft and fixes unforeseen problems, and as the Canadian Forces and other militaries learn more and change how they use the planes to compensate.

It adds that the information in the report “could be used to help plan for replacement aircraft purchases or to determine how to use the original 65 aircraft.”

The December 2011 report does include the proviso that the analysis was only based on information available at that time.

Officials would not comment specifically on the DRDC report.

Instead, Public Works spokeswoman Annie Duguay noted that a National Defence update on the F-35 project last year  “estimated that seven to 11 aircraft could be lost over the 42-year timeframe, and the cost to replace these lost aircraft could be in the order of $1 billion.”

“Rather than initially acquiring more aircraft than are required, the government has retained the option to purchase or not replacement aircraft in the future,” Duguay wrote, echoing established Conservative government policy.

Those F-35s already in operation in the U.S. have shown some problems since rolling off the assembly line.

The U.S. air force’s entire F-35 fleet were temporarily grounded in February when a crack was found in a test aircraft’s engine, the second such grounding in as many months.

A scathing Pentagon report leaked in March also identified a large number of problems facing the U.S. F-35 fleet, from radars that don’t work, to blurry vision from the aircraft’s sophisticated helmet, to an inability to fly through clouds.

The Pentagon report also found problems with maintaining the F-35s, with mechanics taking two days to replace an engine that is supposed to take two hours, and difficulties when aircraft is stored in temperatures below 15 degrees Celsius.

And it found the aircraft were not as reliable as expected as many required more maintenance than anticipated.

Despite these issues, the Pentagon declared in December that the F-35 was ready to begin extended pilot training while continuing to iron out the identified problems.

The Harper government pushed the reset button on its plans to purchase the F-35 last year.

This came after years of criticism over what has been seen as the Conservatives’ refusal to fully disclose how much the F-35s would cost, and after the auditor general raised serious concerns about the Defence Department’s handling of the file.

Bureaucrats have been ordered back to the drawing board to again examine what missions Canada’s jets will perform in the future, what threats they will face, and what fighter capabilities are currently available.

The Royal Canadian Air Force is leading the review with support from other federal departments, while a panel of independent experts has been tasked with monitoring the process to ensure it is rigorous and impartial.

While no timelines have been laid out, a final report 

The Conservative government has set aside $9 billion to purchase new aircraft to replace the air force’s aging fleet of CF-18 fighters.

National Defence revealed late last year that the cost of not only purchasing, but operating, maintaining and disposing of 65 F-35s through 2052 would be in excess of $45 billion.

Air Force's F-35 recommendation was missing key information

Report did not have important data on competing aircraft

The Harper government signed a memorandum of understanding in 2006 expressing its The Harper government signed a memorandum of understanding in 2006 expressing its "intention" to purchase the F-35 in the future and to commit a further $500 million to the Joint Strike Fighter program.

The Royal Canadian Air Force trumpeted the F-35 fighter jet to Canada’s defence minister as the best option for the country even though it was missing key information on competing aircraft, according to a Canadian military insider.

Steve Lucas, former Canadian chief of the air staff, acknowledges in an exclusive fifth estate interview, to air tonight, that the military's recommendation in 2006 to their political masters in Ottawa was based on incomplete data.

“With the stage we were at, at that point in time, not only did we do the glossy brochure examination, but we also went to each of the countries, spoke to each of them,” Lucas told the fifth estate.

But the air force report that backed that recommendation, obtained by the fifth estate, reveals that when the Canadian military visited four other nations that were peddling competing fighter jets they were denied classified information every time.

"Indeed, it does say at the bottom [of the report], more information is needed,” says Lucas. "But I guess I would characterize that as an appropriate level of examination for where we were at, at that point in time … knowing that there would be subsequent examination, more detailed examination as we develop the statement of requirements."

Canada’s auditor general reported that the air force’s statement of requirements was only submitted to the federal Public Works department after the Harper government announced it was committing to purchase 65 F-35 Joint Strike Fighter aircraft.Canada’s auditor general reported that the air force’s statement of requirements was only submitted to the federal Public Works department after the Harper government announced it was committing to purchase 65 F-35 Joint Strike Fighter aircraft.

Despite the fact that the air force review was incomplete and the F-35 was still only in development, the brass recommended in a brief to the defence minister in September, 2006, that the F-35: "provides the best available operational capabilities to meet Canadian operational requirements, while providing the longest service life and lowest per aircraft cost of all options considered."

Based on this recommendation the Harper government signed a memorandum of understanding in 2006 expressing its “intention” to purchase the F-35 in the future and to commit a further $500 million to the Joint Strike Fighter program.

The fifth estate investigation also reveals that, four years later, prior to the Harper government’s controversial 2010 announcement to sole-source the Lockheed Martin-built F-35, the subsequent information Canada obtained about competing aircraft came from the U.S. Joint Strike Fighter office — the very people with the most to gain from selling Canada the F-35.

Canada’s auditor general reported this past spring that the air force’s statement of requirements, laying out what it needed in a new fighter aircraft, was only submitted to the federal Public Works department after the Harper government announced it was committing to purchase 65 F-35 Joint Strike Fighter aircraft. Public Works is normally the department responsible for procuring hardware for the military after it lays out its requirements.

In his interview, Lucas also reveals that he was never keen on a competition to choose Canada’s next fighter jet.

“To hold a true competition, you would actually have to step back from being a partner nation,” Lucas says. “You would actually have to get out of the partnership to be part of a Canadian-style competition.”

Lucas was retired before the government made its decision in 2010 to sole-source the F35.

Cost overruns

The fifth estate documentary also investigates why Canada committed to purchase the F-35 in 2010, two years ahead of schedule, when the fighter program was under siege in the U.S. and in other partner nations for mismanagement and massive cost overruns.

    Former Pentagon fighter designer and F-35 critic Pierre Sprey predicts that when all of the failings of the F-35 have come to light, the cost per aircraft will rise dramatically.

“It wasn’t performing so well, it was late, the costs were running up, international investors and potential buyers and governments were getting worried,” Ottawa defence analyst Steven Staples tells the fifth estate. “So who were their two closest allies on this? Canada and Israel. And those were the two really key countries, I think, that could give some good news. And in 2010 Lockheed Martin was desperate for some good news about the F-35. And Canada gave it to them.”

In 2010, the Harper government publicly announced the cost of purchasing 65 F-35 aircraft would be $9 billion. At the time, the government refused to disclose its own further operating and sustainment cost estimates of $16 billion, which pushed the total cost of the F-35 program to $25 billion over 20 years.

The Joint Strike Fighter program is supposed to produce upwards of 3,000 F-35s for the U.S. and eight partner nations. To date, after more than a decade in development, the Joint Strike Fighter program has only produced 33 planes — all test models or training platforms.

Watch the fifth estate's documentary, Runaway Fighter, on Friday at 9 p.m. (9:30 p.m. in N.L.) for more exclusive revelations.

Former Pentagon fighter designer and F-35 critic Pierre Sprey predicts that when all of the failings of the F-35 have come to light, the cost per aircraft will rise dramatically.

“If Canada is still buying it, they’ll be paying $200 million plus [per plane],” Sprey tells the fifth estate. “Because among other things, the promised quantity will never happen. Nations will drop out, lots of nations won’t be able to afford it and even the U.S. is going to keep on cutting back the buy, and as the buy is cut back, the cost is going to keep going up.”

Telephonics Delivers Multi-mode Radar to Canadian Air Force

Telephonics Corp., a wholly owned subsidiary of Griffon Corp., has delivered its first production AN/APS-508, an advanced multi-mode imaging radar system (IRS), to the Canadian Department of National Defense (CDND) for installation on the CP140 Aurora long-range maritime patrol and surveillance aircraft.

Jointly developed and built by Telephonics and MacDonald, Dettwiler and Associates (MDA), and manufactured by Lockheed Martin (Canada), the AN/APS-508 provides multi-mode surveillance/imaging capability. An initial quantity of nine radar systems and lifecycle spares will be delivered to CDND.

Separately, the Telephonics (Chalet C25) has revealed that its RDR-1700B radar is to be installed on the new Saab 340 maritime surveillance aircraft demonstrator. The radar enables critical maritime missions.

Decades-long mission to replace Sea Kings hits another snag

After more than 25 years of trying to replace the country’s fleet of Sea King maritime helicopters, the Canadian Forces have watched another deadline come and go.

Sikorsky International Operations Inc. was supposed to deliver the first of 28 state-of-the-art CH-148 Cyclones in June, after the Harper government agreed in late 2008 to extend the deadline on the $5.7-billion contract by 43 months.

In the latest in a string of missteps in military procurements, Sikorsky is pushing back on the delivery, with still no official date being offered for the completion of the contract.

“Sikorsky has yet to start delivering the Cyclones,” said Sébastien Bois, a spokesman for Public Works and Government Services Canada.

The Sea Kings, which are nearly 50 years old, have been famously unreliable in recent years as they were placed aboard Canadian frigates on overseas missions to places such as the Persian Gulf. The Cyclones are expected to be more effective in all types of challenging environments, with high-tech radars and sensors to patrol the world’s turbulent seas.

The purchase is the latest in a series of problematic procurements by the Canadian Forces, such as the purchase of underperforming second-hand submarines and delays in acquiring search-and-rescue planes. The biggest controversy for the Harper government to date surrounds the mishandling of the sole-sourced $15-billion deal for F-35 fighter jets, which was the subject of a hard-hitting report by the Auditor-General this spring.

Sikorsky signed a contract with the previous Liberal government in 2004 to start delivering the fleet of Cyclones in 2008. The Harper government agreed in late 2008 to extend the deadline for the delivery of helicopters to June of this year, citing technological hurdles faced by the company.

The contract extension included a funding increase of $117-million as Ottawa said it would receive more powerful choppers than initially planned.

Sikorsky and the federal government are remaining vague about the problems with the Cyclone program, but it is clear the company is struggling to obtain the “airworthiness certification” that is mandatory for the helicopters to fly off on military missions. In addition, the company is still working to ensure the helicopters have the necessary engine power to meet the government’s mandatory endurance requirements.

Ottawa has been trying to replace its Sea Kings with new ship-borne helicopters since the mid-1980s. The Mulroney government had decided to purchase EH-101 helicopters for the job, but in one of his first acts in office, former Liberal prime minister Jean Chrétien scrapped the contract in 1993. The cancellation cost taxpayers $478-million.

After a series of delays, the Liberals announced in 2004 that Sikorsky had won the competition to replace the Sea Kings, which the Canadian Forces had acquired between 1963 and 1969. Problems with the Sea Kings have abounded over the years, including crashes and routine groundings on military missions.

The opposition said the replacement program has become a national embarrassment.

“The whole program has been a disaster,” said NDP MP Jack Harris, who called on the government to slap maximum penalties against the company.

So far, Ottawa has imposed $8-million in liquidated damages against Sikorsky, and is threatening to run up the bill.

“Failure to deliver fully compliant Maritime Helicopters will be met with significant additional charges to the company,” said Michelle Bakos, a spokeswoman for Public Works Minister Rona Ambrose.

The company is late on two fronts. In addition to delays in delivering the final version of the Cyclone helicopter, Sikorsky is also well behind on its promise to deliver an “interim” version of the Cyclone to be used for training.

According to the 2008 contract extension, the interim helicopters were supposed to meet watered-down requirements, and were scheduled to arrive at the Canadian Forces base in Shearwater, N.S., in November, 2010. However, that portion of the contract has also not been fulfilled, causing months of delays in the training of technicians and aircrews.

“Critical work remains to be done before the Government of Canada can take official delivery and assume ownership of the interim helicopters,” Mr. Bois said. “Sikorsky leadership has reconfirmed their commitment to deliver helicopters at no additional cost to the Crown.”

Public Works and National Defence are stating that they expect the delivery of the interim helicopters to occur “later this year.” This suggests the delivery of the fully compliant helicopters – initially scheduled for 2008 – will not happen until 2013.

The Auditor-General investigated the Cyclone purchase in 2010, and concluded that National Defence underestimated the complexity of developing the military helicopters, which were wrongly defined as being an “off-the-shelf” purchase.

“In our opinion, National Defence did not adequately assess the developmental nature of this aircraft, and the risks related to cost and the complexity of the required technical modifications were underestimated,” the Auditor-General said.

National Fighter Procurement Secretariat Now Operational

The Honourable Rona Ambrose, Minister of Public Works and Government Services and Minister for Status of Women, today announced that the National Fighter Procurement Secretariat is now operational. The Secretariat will ensure that due diligence, oversight, and transparency are applied so that the Royal Canadian Air Force acquires the fighter aircraft it needs to complete its missions at home and abroad.

The Terms of Reference have been finalized, and they will guide and shape the work going forward, detailing who will do what, and how. The aim of the Terms of Reference is to set in place an improved governance and coordination structure, strengthen due diligence, and commit departments to transparency through more timely and effective communications. The Deputy Minister-level Governance Committee will present its conclusions to ministers in support of the Government's decisions on how to move forward with the replacement of the CF-18 fleet.

"I am pleased to announce that the Secretariat is operational and will play the lead coordinating role as the Government moves to replace Canada's aging CF-18 fleet," said Minister Ambrose. "As stated in the seven-point action plan, the funding envelope allocated for the acquisition of a new fighter aircraft will remain frozen and Canada will not purchase replacements until further due diligence, oversight, and transparency are applied to this acquisition."

A Deputy Minister-level Governance Committee has been established as the key decision-making body for the oversight and coordination of the work of the Secretariat. This committee will be chaired by the deputy minister of Public Works and Government Services and includes senior officials from the Department of National Defence and Industry Canada, and ex-officio members, including the National Security Advisor to the Prime Minister, and members from the Privy Council Office, the Treasury Board of Canada Secretariat, and the Department of Finance Canada.

In addition, two eminent Canadians who are external to the public service have been confirmed as members of the decision-making body. These independent members will further strengthen the impartiality of the decision-making process. Joining the committee in this role are L. Denis Desautels, former Auditor General of Canada (1991-2001) and a recipient of the Order of Canada; and Dr. Kenneth Norrie, an economic historian and professor of economics at McMaster University.

"I am very pleased that Mr. Desautels and Dr. Norrie will assist with this important work," said Minister Ambrose. "Their considerable experience providing informed, independent points of view on matters of public policy is welcome and will result in additional due diligence in support of the project."

The National Fighter Procurement Secretariat is led by a newly appointed executive director, and supported by a small team drawn from departments with responsibility for this acquisition.