Government of Canada announces contract awards for research and development in support of Arctic surveillance

On the same subject

• 

  July 3, 2018 | Local, Naval

  Davie aims to replace Canadian Coast Guard's entire icebreaker fleet

  Kevin Dougherty Shipbuilding firm will start work on icebreaker conversion this summer Chantier Davie Canada Inc., the country's largest shipbuilding firm, is gunning for contracts to build new icebreakers for the Canadian Coast Guard. "Given the age of the Canadian Coast Guard fleet, the entire icebreaker fleet will need to be replaced in the near future," says Alex Vicefield, CEO of Inocea Group, which has owned Davie since 2012. "We have every intention of submitting a world-class proposal together with global leaders in icebreaker design." Until then, Davie, located across the river from Quebec City in Lévis, is in the home stretch of negotiations with the federal government to convert three surplus commercial icebreakers for the Canadian Coast Guard. Under its new management, Davie has made its mark in the industry by turning surplus ships into lower-cost solutions. The first converted icebreaker will be ready in time for the 2018-2019 ice season on the St. Lawrence and Great Lakes. However, when it comes to building new ships, there remain doubts about Davie's ability to deliver at a competitive cost. Canadian ships cost 'twice as much' Marc Gagnon is director, government affairs and regulatory compliance for the Montreal-based Fednav, which operates a fleet of nearly 100 ships. Fednav buys its ships in Japan because, Gagnon says, Canadian-built ships cost "at least twice as much." "Davie no longer has the capacity to build an icebreaker or a frigate," Gagnon said. "To do so, they would have to re-equip their shipyard." Vicefield said Davie is aware of the challenges ahead and has invested $60 million to upgrade its steel-cutting and IT infrastructure. The University of British Columbia's Michael Byers, who argues that Ottawa's current shipbuilding strategy is too costly and needlessly slow, says building government ships in Canada makes sense and Davie is definitely up to the task. "For every $100 million that is spent on building a ship in Canada, you would get several times more than that in terms of knock-on economic activity," Byers said. "And Davie is the logical place to do it. They have a very large shipyard. They have a very capable workforce. The labour costs are relatively low and it's an active shipyard." Asterix 'very impressive' Last year, before Ottawa agreed to sit down with Davie to discuss the icebreaker conversions, Davie delivered the Asterix — a container ship converted into a supply ship for the Royal Canadian Navy — on time and on budget. ​In 2015, when the navy's existing two supply ships were no longer seaworthy, Vicefield and his team proposed converting the Asterix to a naval supply ship for about $600 million. "What they did with the Asterix was very impressive," Byers said. "There is no other shipyard in Canada that could have done that." In comparison, Vancouver-based ​Seaspan was chosen to build two new navy supply ships for $2.6 billion. But the first new supply ship will only be ready in 2020. "This is a cutthroat business and there is a lot of money involved and a lot of politics involved," Byers said. "Davie has the capacity and the experience to build icebreakers, plus they have the lowest costs in terms of labour of any shipyard in the country," he said. The Canadian Coast Guard has an aging fleet of 13 ice-breaking vessels and two hovercraft. Ice still a hazard to navigation Canada's oldest and largest icebreaker, the CCGS Louis S. St-Laurent, was commissioned in 1969. It was to be replaced in 2017 by the CCGS John G. Diefenbaker. But from the initial estimate of $720 million, the Diefenbaker is now expected to cost over $1.4 billion, with delivery in 2022. To meet Ottawa's need for "interim icebreakers," Davie found four icebreakers built for oil and gas drilling off the coast of Alaska that were idled when oil prices fell, putting an end of Shell's Arctic venture. Prime Minister Justin Trudeau agreed to negotiations with Davie to acquire the three smaller ice-breaking vessels, leaving aside the larger Aiviq. With no other shipyard matching Davie's proposal, the conversion work will begin this summer. https://www.cbc.ca/news/canada/montreal/davie-coast-guard-icebreakers-canada-vicefield-byers-gagnon-1.4730332

• 

  October 23, 2020 | Local, Aerospace, Naval, Land, C4ISR, Security

  Canada moves closer to military-spending target following previous critique from NATO, U.S.

  OTTAWA - Canada has taken a big leap closer to meeting its promise to the NATO military alliance to spend a larger share of its economy on defence thanks to an unexpected assist from COVID-19. New NATO figures released Wednesday show that largely thanks to the pandemic, Canada is poised to spend the equivalent of more of its gross domestic product on defence this year than at any point in the past decade. That is because the alliance expects the Liberal government to hold Canadian defence spending steady even as COVID-19 batters the country's economic output. Yet defence analyst David Perry of the Canadian Global Affairs Institute says the results are unlikely to appease the United States, as Canada continues to fall far short of its promise to NATO to spend two per cent of GDP on defence. “I think they'll be pleased to see positive momentum,” Perry said of the U.S., “but it doesn't resolve their concern about where we are.“ All NATO members, including Canada, agreed in 2014 to work toward spending the equivalent of two per cent of their GDP — a standard measurement of a country's economic output — on defence within the next decade. The promise followed complaints from the U.S. about burden-sharing among allies and broader concerns about new threats from Russia and China as the two countries increased their own military spending. NATO and the U.S. have repeatedly criticized Canada for not meeting the target, with President Donald Trump in December calling Canada “slightly delinquent” during a meeting with Prime Minister Justin Trudeau. His predecessor, Barack Obama, also called out Canada over its defence spending during an address to Parliament in 2016. The U.S. spends more than any other NATO member on defence, both in terms of raw cash and as a share of GDP. NATO Secretary-General Jens Stoltenberg on Wednesday said the continued importance of increasing military spending would be discussed when defence ministers from across the alliance meet this week. The NATO figures show that Canada is poised to spend 1.45 per cent of its GDP on the military this year. That is not only a big jump from the 1.29 per cent last year, but the largest share of the economy in a decade. It also exceeds the government's original plan, laid out in the Liberals' defence policy in 2017, to spend 1.4 per cent of GDP on the military by 2024-25. That is when NATO members were supposed to hit the two-per-cent target. Yet the figures show the expected increase isn't the result of a new infusion of cash for the Canadian Armed Forces this year as spending is expected to hit $30 billion, up just over $1 billion from 2019. Rather, NATO predicts Canadian GDP will shrink by about eight per cent this year as COVID-19 continues to ravage the economy. The fact Canadian defence spending is expected to remain largely steady despite the pandemic is noteworthy, particularly as there have been fears in some corners about cuts to help keep the federal deficit under control. The NATO report instead appears to lend further credence to recent assertions from Defence Minister Harjit Sajjan, Defence Department deputy minister Jody Thomas and others that the Liberals are not readying the axe. Canada also remained 21st out of 29 NATO members in terms of the share of GDP spent on the military as other allies also got a surprise boost from the economic damage wrought by COVID-19. At the same time, Perry said the government has yet to lay out a timetable for when it plans to meet the two per cent target. Military spending is instead expected to start falling after 2024-25, according to the Liberal defence plan. Despite having agreed to the target during the NATO leaders' summit in Wales in 2014, successive Canadian governments have repeatedly described the NATO target as “aspirational.” This report by The Canadian Press was first published Oct. 21, 2020. https://www.thestar.com/news/canada/2020/10/21/canada-jumps-closer-to-military-spending-target-thanks-to-covid-19s-economic-damage.html

• 

  May 10, 2019 | Local, Aerospace

  Canada changing rules of competition for $19B fighter jet fleet to allow consideration of F-35: sources

  David Pugliese, Ottawa Citizen The Canadian government is changing the terms of the $19-billion competition to replace its aging fleet of fighter jets to allow the U.S. to enter its F-35 stealth fighter. The changes will allow for a more flexible approach in determining the value of the benefits bidders offer to Canadian defence firms, industry sources say, and come after a series of discussions with the U.S. government and threats by the Pentagon to withdraw the jet from consideration. Under the current terms, bidders were required to offer industrial benefits to Canada as part of the competition. That system, which would have disadvantaged the F-35, will now be amended, sources say. But those companies that do guarantee work for Canadian firms will receive more consideration under the new rules. U.S. officials had warned that the agreement Canada signed to be a partner nation in Lockheed Martin's development of the F-35 prohibits those partner nations from imposing requirements for industrial benefits in fighter jet competitions. “We cannot participate in an offer of the F-35 weapon system where requirements do not align with the F-35 Partnership,” U.S. Navy Vice-Adm. Mathias Winter told Canadian officials in a letter sent in December. Under the agreement, companies from the partner nations are eligible to compete for work on the F-35s, and contracts are awarded on a best-value basis. Over the last 12 years, Canadian firms have earned more than $1.3 billion in contracts to build F-35 parts. In a statement issued last week, Lockheed Martin Canada said that hundreds of Canadian jobs had been created by work on the jet. The firm noted that it continued to provide feedback to the U.S. government, which is involved with Canada in government-to-government discussions on the fighter jet program. The competition to win the Canadian contract for a fleet of 88 new fighter jets was launched on Dec. 12, 2017 and at this point four fighter jets are expected to be considered. Those include the F-35, the Super Hornet, the Eurofighter Typhoon and the Gripen. The Canadian government expects to award the contract in 2022. A request for bids for the new jets was scheduled to be released in conjunction with the CANSEC defence trade show in Ottawa at the end of the month, with bids to be evaluated by 2021. However, the government now admits that schedule is risky. In its latest update on major equipment projects the Department of National Defence said “The approved schedule is considered very aggressive,” and that “The project team is managing a number of risks which have the potential to impact schedule.” The document doesn't outline the specific risks but DND officials have acknowledged that figuring out how to deal with industrial benefits linked to the project could cause delays. The delivery of the first of the jets is expected in the mid-2020s, with the full capability available in the early 2030s, according to the DND document. The plan to purchase used Australian F-18s in the interim, the first already delivered, is also outlined in the document. It noted the final delivery of those jets is set for the end of 2021. https://nationalpost.com/news/canada/canada-changing-rules-of-competition-for-19b-fighter-jet-fleet-to-allow-consideration-of-f-35-sources