May 7, 2019 | Local, Aerospace
Murray Brewster · CBC News
The Trump administration fired two warning shots last year over the Liberal government's long-delayed plan to replace Canada's CF-18 fighters, saying the procurement process discriminates against the Lockheed-Martin-built F-35 stealth jet, according to a new academic report.
The study by a researcher at the Macdonald-Laurier Institute (MLI) cites leaked Pentagon letters written last summer and late fall to officials at Public Services and Procurement Canada.
The report, released Monday, largely blames the Liberal government for the delays in the procurement, while making only a passing reference to the inability of the former Conservative government to deliver on the same program.
The report's major revelation involves the leaked letters — which are expected to inflame the debate over the nearly decade-long on-again, off-again plan to replace the air force's 1980s-vintage CF-18s with modern warplanes.
The source of the Pentagon's irritation is a federal government policy that insists defence manufacturers deliver specific industrial benefits to Canadian companies.
That's not how the F-35 program is structured. Countries that participated in the development of the stealth jet — as Canada did — pay an annual fee to remain part of the program, which gives domestic aerospace companies in those countries the right to bid on F-35 work.
The U.S. undersecretary for defence acquisition and sustainment wrote to Canada's assistant deputy minister of defence procurement in Public Services and Procurement Canada last summer to complain about the Industrial and Technological Benefits (ITB) policy.
Ellen Lord warned the policy runs contrary to the F-35 participation agreement and accused Canada of trying to leverage a better deal than its allies.
"This text basically stated that Canada had signed the [Memorandum of Understanding] clearly understanding these provisions and could not now try to renegotiate a better deal," said the Aug. 31, 2018 letter, leaked to MLI researcher Richard Shimooka.
Lord went on to say the current procurement process "would be fundamentally and structurally prejudicial to any F-35 bid."
The point was hammered home when former U.S. Vice-Admiral Mathias Winter, in charge of the Joint Program Office overseeing F-35 development, wrote to Canada's head of future fighter development at Public Services.
After reviewing the federal government's draft request for proposals, Winter wrote that the F-35 would not be able to participate given the way the system is structured now.
"Fundamentally, the F-35 program is different from Foreign Military Sales or Direct Commercial sales procurements," said the Dec. 18, 2018 letter.
"The current [Future Fighter Capability Program] does not allow the F-35 to participate in a fair and open competition that recognizes the special nature and distinct advantages of the partnership."
Lockheed-Martin is one of four manufacturers that plan to bid on the fighter jet replacement program. Several defence and defence industry sources told CBC News in a story published last month that the full tender was expected to be released at the end of May, with final bids to be delivered by the end of the year.
There is considerable uncertainty about the timeline, however, because of questions and disputes about the project's industrial expectations.
"A delay is inevitable," said one defence industry source on Monday.
With the release of the letters, the institute's analysis peels back the curtain on perhaps the most contentious of the disputes: how to reconcile the existing F-35 benefits package with the federal government's standard procurement model.
Lockheed-Martin would not confirm whether the issues raised in the letters remain active concerns, but sources within both the defence industry and the federal government say there is an ongoing dialogue.
The U.S. defence giant, in a statement, said it did not commission the report but acknowledged it had provided "factual information to several think tanks in Canada" about its various programs.
The company said the structure of the F-35 program means it is the U.S. defence department that does all of the talking.
"We continue to provide our feedback to the U.S. government, which leads all government-to-government discussions related to the Canadian fighter replacement competition," said Cindy Tessier, head of communications for Lockheed Martin Canada.
She touted the $1.25 billion in contracts already awarded to Canadian companies because of the F-35 program and said the potential is there for more work once the fighter aircraft reaches full production in a few years.
"As a valued current partner on the program, Canadian industry has the opportunity to produce and sustain components and systems to a fleet that is expected to grow to more than 4,000 aircraft," she said.
A spokeswoman for Public Services Minister Carla Qualtrough did not address the Pentagon letters directly, but did say the government has engaged in continuous dialogue with potential bidders as it sought feedback on the proposed tender.
"The approach is inherently designed to encourage continuous supplier engagement," said Ashley Michnowski. "We do this so that suppliers are able to make informed business decisions.
"Our government has been hard working to address as much of the supplier feedback as possible to ensure a level playing field and a fair and open competition with as many eligible suppliers as possible."
The process is not yet complete, although it is nearing its conclusion and a final request for proposals will be issued soon, she added.
June 29, 2023 | Local, Other Defence
Canada is expected to boost military spending after a government review next month, but the increase is unlikely to comfort allies facing new threats and it could further undermine the country's international military credibility, policy analysts said.
May 7, 2019 | Local, Aerospace
By Simon Carroll Like Canadians, Swedes are natural innovators. When faced with challenges like a shifting global economy, the threat of climate change or the rapidly evolving landscape of modern national defence – both countries adapt and innovate based on evidence, reason and shared progressive values. This is so much the case that Swedish and Canadian governments are both actively implementing innovation agendas intended not only to grow their respective high-tech and aerospace industries (among others) from the inside-out, but to help them access and leverage the very best global talent and expertise in these fields. Canada's Innovation and Skills Plan, for instance, seeks to encourage greater business investments in research and to capitalize on Canadian inventions through “shared risk taking and partnerships”. The more Canada and Sweden build and use these partnerships to innovate together, the stronger both countries will be, now and in the future. At Saab, we believe opportunities to develop and grow partnerships with Canadian government and industry are not only a ‘good fit' – we believe these opportunities will help actualize Canada's ambitious innovation vision for decades to come. In large part, Swedish companies are well-positioned to help Canada reach its innovation goals because innovation is inherent in their DNA. Sweden is consistently judged one of the world's most innovative countries by the annual Bloomberg Innovation Index, which placed Sweden second in 2018 (behind South Korea and ahead of Singapore, Germany and Switzerland), and by the World Intellectual Property Organization's Global Innovation Index, which ranks Sweden among the top three countries. This level of recognition is well-earned. Swedes are early adopters of new technologies, are highly trend-sensitive and, collectively, produce one per cent of the world's knowledge while constituting less than one-thousandth of the world's population. The Swedish government formalized this innovative spirit in 2001 when it created the national Innovation Agency, Vinnova – one of the first of its kind in the world. Of course, Sweden has long been home to a suite of classically innovative and instantly-recognizable brands like Volvo, Ikea, and Ericsson, but its government's exceptional focus on innovation in recent decades has grown this small but mighty nation's startup hub into a full-blown entrepreneurial powerhouse. By no coincidence, Sweden has produced more “$100 million-plus IPO exits” than any other country in the world, with examples including popular music streaming platform Spotify and the financial technology company iZettle. Having research-intensive companies, such as Saab, is yet another reason Sweden does so well in global innovation rankings. The majority of Saab's people are trained engineers and around 23 per cent of its total revenues are spent on research and development (R&D) every year. That's a lot compared with other companies, but it's what it takes to think ahead and develop products and solutions with future capabilities in mind. The Swedish approach to future technology generation is one that actively combines government- and university-based research and development capabilities with those of industry to solve common problems and to develop new, unique solutions. Harnessing the unique talents and energy contributed by each of these spheres builds a strong engine for innovative thinking and new technology development – all of which is central to Saab's corporate ethos. Saab Canada is already an extensive supplier of military equipment to the Canadian Armed Forces – from radars and sensors for the Royal Canadian Navy to ground combat weapons and signature management systems for the Canadian Army – as well as supplying transponders to the Canadian Coast Guard and maritime traffic management systems to the Great Lakes Pilotage Authority. Saab is also partnered with many small, medium and large-sized Canadian companies up and down its supply chain, across all of its product areas from Nova Scotia-based MilAero for electrical cable assemblies, to Bombardier with its Global 6000 business jet used for GlobalEye, an airborne early warning and control solution. As a contender for Canada's future fighter jet program, Saab's ‘future-proof' Gripen E aircraft presents even greater opportunities for collaboration and development activities between the military and aerospace sectors of both countries. These kinds of partnerships mean that Canadian companies not only benefit from Saab's innovative thinking, but are also empowered to further develop their own, Canadian-made innovations that can then be exported worldwide – generating economic benefits right here in Canada. Looking to the future, Saab will continue working closely with our Canadian partners to pursue opportunities here and abroad, where we can build on existing collaboration and continue to strengthen the innovation that runs deep in our respective countries. https://ipolitics.ca/2019/05/06/swedish-companies-like-saab-a-best-fit-for-canadas-innovation-agenda/
June 29, 2018 | Local, Aerospace
OTTAWA, June 28, 2018 /CNW/ - UTC Aerospace Systems (UTAS) Landing Systems site in Oakville, Ontario, is Airbus' sole supplier for the main landing gear of the A350-1000, the world's newest long range widebody airliner. With 168 A350-1000s ordered by airlines around the world, the cooperation is expected to bring long-term, sustainable and high-quality work to Canada, this also resulting through the Industrial and Technological Benefits (ITB) associated with the Airbus C295 FWSAR program. The program looks to provide business even beyond the duration of the current FWSAR ITB achievement period. "I am pleased to see that UTC Aerospace Systems' expertise is being recognized through this important contract with government suppliers. Our government is leveraging its purchasing power to bring economic benefits and jobs to Canadian firms, enabling them to grow and innovate, which is creating highly-skilled jobs and economic growth in Oakville and across the country," said the Honourable Navdeep Bains, Minister of Innovation, Science and Economic Development (ISED). UTC Aerospace Systems celebrated an important milestone earlier this year with the entry into service of its first Airbus A350-1000 landing gear, flying today with two operators. "At UTC Aerospace Systems, our Landing Systems business has a long history of operating in Canada and partnering with Airbus," said the company's Oakville Vice President Frank Karakas. "We're proud of that legacy, and look forward to building on it in the years to come." The manufacturing of the landing gear also incorporates a sizeable element of Canadian Small Medium Business (SMB) volumes, thus benefitting the local supply chain. The project also supports numerous ISED goals, such as world product mandates, export enhancement, sustainable business and SMB involvement. "Airbus and UTAS have been partners for many years and this new technology incorporated into the A350-1000 widebody airliner is just another example of how we continue to support Canadian innovation," said Simon Jacques, President, Airbus Defence and Space Canada. The A350-1000 is the latest member of Airbus' leading widebody family, showing high level of commonality with the A350-900 with 95% common systems part numbers and Same Type Rating. As well as having a longer fuselage to accommodate 40% larger premium area (compared to the A350-900), the A350-1000 also features a modified wing trailing-edge, new six-wheel main landing gears and more powerful Rolls-Royce Trent XWB-97 engines. Along with the A350-900, the A350-1000 is shaping the future of air travel by offering unprecedented levels of efficiency and unrivalled comfort in its 'Airspace' cabin. With its additional capacity the A350-1000 is perfectly tailored for some of the busiest long-haul routes. The FWSAR programme is supporting approximately $2.5 billion (CAD) in ITB value return to Canada, through high-volume, long-term partnerships with companies, such as UTC Aerospace Systems. About Airbus Airbus is a global leader in aeronautics, space and related services. In 2017 it generated revenues of € 59 billion restated for IFRS 15 and employed a workforce of around 129,000. Airbus offers the most comprehensive range of passenger airliners from 100 to more than 600 seats. Airbus is also a European leader providing tanker, combat, transport and mission aircraft, as well as one of the world's leading space companies. In helicopters, Airbus provides the most efficient civil and military rotorcraft solutions worldwide. https://www.newswire.ca/news-releases/airbus-delivers-on-industrial-and-technological-benefits-for-fixed-wing-search--rescue-aircraft-fwsar-program-with-utas-landing-gear-on-a350-1000-686854821.html