August 12, 2020 | Local, Aerospace

How selecting the Lockheed Martin F-35 could impact Canada’s economy

Posted on August 12, 2020 by Chris Thatcher

The Lockheed Martin F-35A Lightning II has long been considered the favourite to replace the Royal Canadian Air Force (RCAF) CF-188 Hornet. But in a competition now being contested in a weakened economy in which the government faces a ballooning deficit and an uncertain job market, how well each fighter jet scores on acquisition and sustainment costs and economic benefits to Canada – worth 40 per cent of the evaluation – could be almost as important as how well the aircraft meets the Air Force's capability requirements.

The Joint Striker Fighter (JSF) has become the most expensive weapons program ever for the U.S. Department of Defense and could cost more than US$1 trillion over its 60-year lifespan, according to the New York Times. The Department of National Defence in 2013 estimated the full cost of procuring and operating the F-35A at US$45 billion over 30 years. Others have pegged the number far higher.

Furthermore, under the rules of the JSF partnership agreement, to which Canada is a signatory, Lockheed Martin cannot offer traditional industrial and technological benefits (ITBs) to Canadian industry.

If company officials are feeling at a disadvantage, they aren't admitting it.

“We understand the rules, we understand the way the competition is structured and the requirements,” said Steve Callaghan, Lockheed Martin's vice-president of F-35 development and a former U.S. Navy F-18 squadron commander and Fighter Weapons School instructor.

In an online briefing to media on Aug. 6, Callaghan shared the results of an economic impact assessment that suggested selection of the F-35 could impact GDP by almost $17 billion and generate more than 150,000 jobs over the life of the program.

Lockheed Martin submitted its 7,000-page bid on July 31 to replace the RCAF's 94 legacy Hornets with 88 F-35A fighters. The proposal is one of three the federal government received at the deadline for a contract valued at up to $19 billion. Boeing's F/A-18E/F Super Hornet and Saab's Gripen E are also in the running.

The government may begin negotiations with one or more of the compliant bidders once the initial evaluation is completed, likely by next spring. The final decision is expected in 2022 and first deliveries by 2025.

As the RCAF and Public Services and procurement Canada now begin to evaluate the proposals, Lockheed Martin was keen to remind Canadians the F-35A is the only fifth-generation fighter in the competition. “It truly is a generation ahead of any other fighter in production and can be procured for about the same or less than the far less capable fourth-generation aircraft,” said Callaghan.

Though the Joint Strike Fighter program was originally launched with the intent of developing a more cost-effective family of aircraft with a shared design and common systems, and high production volume to reduce procurement and sustainment costs, the ambitious program has struggled with high development costs and the final price tag.

However, between the second Low Initial Production Rate (LRIP) in 2008 and LRIP 10 in 2016, the cost of an F-35A decreased by about 60 per cent. As Lockheed Martin ramps up to a production rate of about 141 aircraft per year for LRIP 14, its reached a per unit cost of about US$78 million.

The aim now is to bring the cost per flight hour down under US$25,000 by 2025.

“We are putting that same level of focus, that same level of rigour and innovation to reduce sustainment costs,” said Callaghan. “With ... every flight hour, the enterprise gets smarter, more mature, more effective, more on track to meet several critical performance and affordability targets.”

Equally important to a government that will be eying more well-paying jobs in the aerospace sector for decades to come, Callaghan highlighted Canada's involvement in the JSF program. The federal government was the first nation to sign on to the U.S. partnership and to date “more than 110 Canadian companies have contributed to the development and the production of the F-35,” he said, resulting in about US$2 billion in contracts.

According to the economic impact study, conducted by Offset Market Exchange (OMX), a Toronto-based firm that helps OEMs develop their Canadian supply chains and provides analytics to ensure compliance with ITB obligations, the full impact of the program between production (2007 and 2046) and sustainment (2026 and 2058) could result in $16.9 billion to Canada's GDP.

Though contracts are awarded on a “best value” basis among all participating countries, Canadian companies have proven their ability to compete and deliver quality, he added. And suppliers would be building parts not just for 88 aircraft, but likely for over 3,000.

With the F-35 manufactured in the U.S. and many sustainment hubs already selected, several Canadian companies have been raised concerns about access to high-value in-service support work. Though Callaghan wouldn't commit to specifics, he noted that more than 2,500 F-35s could be operating in North America past 2060, resulting in “a large number” of potential sustainment opportunities.

“I think Canadian industry is in a very good position to capture quite a few of those contracts,” he said.

If Canada opts for another aircraft, the current contracts would be honoured “to their conclusion,” but would then be placed up for best value bids to JSF nations, he added.

Though Lockheed Martin is still ramping up production and addressing software issues, the F-35 is a rapidly maturing program. Over 550 aircraft have been delivered and the entire fleet has accumulated over 300,000 flight hours. Eight services, including five outside of the U.S., have declared initial operating capability and the Royal Australian Air Force is expected to do so before the end of 2020.

F-35s have been part of operations and joint and international exercises. Both Norway and Italy have conducted NATO Iceland air policing with their fleets.

“These are indications of the maturity of the program,” said Callaghan. “We are a mature program that is really hitting stride.”

https://www.skiesmag.com/news/f-35-impact-canadas-economy/

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January 21, 2020 | Local, Aerospace, C4ISR

CAE appoints Todd Probert as group president, Defence and Security
CAE has announced the appointment of Todd Probert as group president, Defence and Security, effective Jan. 27, 2020. He will be based in Washington, D.C., and is succeeding Gene Colabatistto, who retired from CAE in December 2019. “I am very pleased to welcome Todd Probert to CAE's executive management team, as our new group president, Defence and Security. He is a proven strategic business leader with the right balance of technical, business and international experience in defence and technology,” said Marc Parent, CAE's president and chief executive officer. “Todd's competencies and background are very well aligned with CAE's emphasis on digital innovation and our long-term vision to be the training partner of choice. His ability to drive business growth and create strategic partnerships will bring significant value to our company and our defence customers.” Probert worked for Raytheon, the world's fourth largest defence company, over the past 10 years. Most recently, he was leading the Command, Control, Space and Intelligence business unit as part of Raytheon's Intelligence, Information and Services segment. In this role, he spearheaded Raytheon's use of commercial software development practices and artificial intelligence for military and intelligence community customers in addition to establishing strategic relationships with Silicon Valley companies. He previously served as the vice-president of Raytheon's Mission Support and Modernization product line where he steadily grew the business during his tenure. He has formed innovative partnerships with leading tech companies to transform the development timelines and delivery of capabilities to the U.S. Department of Defense in areas such as fully open architectures, artificial intelligence and cyber security. He also held the position of vice-president, Engineering and Technology, where he managed the engineering workforce for Raytheon's Intelligence, Information and Services portfolio. Before joining Raytheon, Probert worked for Honeywell Technology Solutions, Inc. (HTSI) in various functions such as strategy and business development, planning and operations, merger and acquisition activities, and he also served as HTSI's chief technology officer. Prior to that, he worked for ANSER, where he led the Space Technology division. In 2019, Probert was named by WashingtonExec as one of the Top 10 Department of Defense (DOD) Executives to Watch based on business accomplishments, impact on the defence community and vision for the future. He also received the 2019 Aviation Week Program Excellence Award in the OEM Sustainment category. Probert holds a master's degree in aeronautical and astronautical engineering from Purdue University, where he was named Outstanding Aerospace Engineer of the Year in 2017. He has a bachelor's degree in aerospace engineering from the University of Michigan. https://www.skiesmag.com/press-releases/cae-appoints-todd-probert-as-group-president-defence-and-security
June 2, 2022 | Local, Aerospace, Naval, Land, C4ISR, Security

Feds should create a new, single entity Defence Procurement Canada
August 27, 2020 | Local, Aerospace, Other Defence

Government awards design contract for future fighter infrastructure in Cold Lake
August 27, 2020 – Ottawa, Ontario – National Defence / Canadian Armed Forces As outlined in Canada's defence policy, Strong, Secure, Engaged, the Government of Canada is providing Canadian Armed Forces (CAF) personnel with the facilities and tools to support their operations for the future. Today, the Honourable Harjit S. Sajjan, Minister of National Defence, announced a $9.2-million contract award to EllisDon Construction Services Inc., of Edmonton, Alta., for the design of a new fighter jet facility at 4 Wing Cold Lake, one of two main operating bases for Canada's future fighter aircraft. A second facility and contract award is also planned for 3 Wing Bagotville. Combined, this infrastructure will support the long-term maintenance and operation of 88 new aircraft being procured for the Royal Canadian Air Force (RCAF) through the Future Fighter Capability Project (FFCP). This contract is an important milestone in preparing Cold Lake for the future fighter, and it takes us one step closer to delivering the infrastructure our aviators need for the future. Both infrastructure projects will also provide significant economic opportunities for the Canadian construction industry, as well as the Cold Lake and Bagotville communities. In total, over 900 jobs are expected to be created during the design and construction of both facilities. The Cold Lake facility will host two tactical fighter squadrons and will cover approximately 19,300 m2, providing space for daily operations, maintenance, administration, mission planning, and simulator training. It will also house operational and support training squadrons and their training facilities. Quotes “We invest in this modern infrastructure to house our future fighter aircraft because we know it is critical to ensuring the safety and security of Canadians, as well as meeting Canada's international obligations to NORAD and NATO. A modern fighter jet fleet is essential for the defence of our country and its sovereignty, and these facilities are vital to enabling these operations.” The Honourable Harjit S. Sajjan, Minister of National Defence “This infrastructure project is a significant investment in the future of the Canadian Armed Forces and the Cold Lake community. Building this facility will help sustain jobs near the base, and will ensure our military is well equipped for the future.” Anita Vandenbeld, Parliamentary Secretary to the Minister of National Defence Quick facts We expect to award the design contract for our future fighter facility in Bagotville in September 2020. Construction is estimated to begin at both bases in summer 2022. Both design contracts will also include options for the contractors to build the new facilities, and any additional infrastructure once the future fighter is selected, should Canada decide to exercise these follow-on options. By awarding these infrastructure design contracts ahead of choosing a future fighter, we will start on work that is needed, regardless of which of the three potential aircraft is selected. This will ensure both bases are ready for the first aircraft deliveries. These facilities will be designed and constructed to Leadership in Energy and Environmental Design Silver standards and will use energy efficient options wherever possible. Associated links Future Fighter Capability Project Contacts Floriane Bonneville Press Secretary Office of the Minister of National Defence Phone: 613-996-3100 Media Relations Department of National Defence Phone: 613-904-3333 Email: mlo-blm@forces.gc.ca https://www.canada.ca/en/department-national-defence/news/2020/08/government-awards-design-contract-for-future-fighter-infrastructure-in-cold-lake.html

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How selecting the Lockheed Martin F-35 could impact Canada’s economy

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Feds should create a new, single entity Defence Procurement Canada