Trudeau says Canada wants out of $13 billion deal to sell armored vehicles to Saudi Arabia

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  12 août 2020 | Local, Aérospatial

  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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  11 juin 2018 | Local, Aérospatial, Naval, Terrestre, C4ISR

  Création d'un conseil conjoint de Défense Canada-France

  La France et le Canada ont décidé de rapprocher leurs armées en créant un conseil conjoint de Défense d'ici la fin de l'année, a annoncé mercredi à l'AFP une source gouvernementale canadienne. Ce «Conseil de défense conjoint ministériel sera convoqué d'ici la fin de l'année 2018» et permettra de mieux coordonner les actions des armées canadiennes et françaises, a déclaré à l'AFP ce haut responsable canadien. Cette annonce intervient à l'occasion de la visite à Ottawa du président français Emmanuel Macron, venu se coordonner avec le premier ministre Justin Trudeau en amont du sommet du G7 qui se tient vendredi et samedi au Québec. Intitulée officiellement «Conseil franco-canadien de coopération en matière de défense», cette structure doit permettre aux armées des deux pays de conduire davantage d'opérations conjointes, a précisé cette source. Il est notamment «envisagé» de mener à terme des opérations de maintien de la paix franco-canadiennes sous les auspices des Nations-Unies, a-t-on précisé. En outre, Paris et Ottawa «s'engagent à mettre en place un Conseil des ministres franco-canadien, autour du président de la République française et du premier ministre du Canada», selon une déclaration transmise à l'AFP. Ce Conseil des ministres se réunira «au minimum» tous les deux ans «pour faire un bilan de cette coopération renforcée et développer des actions conjointes», a ajouté le haut responsable canadien. La France mène déjà de tels Conseils des ministres binationaux avec l'Allemagne et le Québec. http://www.tvanouvelles.ca/2018/06/06/creation-dun-conseil-conjoint-de-defense-canada-france

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  5 décembre 2019 | Local, Aérospatial, Naval, Terrestre, C4ISR, Sécurité

  Incoming AIAC chair discusses aerospace vision

  by Chris Thatcher As Members of Parliament return to the House of Commons this week, aerospace eyes will be on the cabinet ministers and MPs most likely to support a new vision for the industry. With the return of Marc Garneau to Transport Canada, Navdeep Bains to Innovation, Science and Industry, Harjit Sajjan to National Defence and Mary Ng to Small Business and Export Promotion, and the introduction of Anita Anand to Public Services and Procurement and Carla Qualtrough to Employment, Workforce Development and Disability Inclusion, the government's front benches include ministers well acquainted with key issues that need to be addressed if Canada is to retain its position as a leading global aerospace nation. Last fall, the Aerospace Industries Association of Canada (AIAC) asked Jean Charest, a former premier of Quebec and deputy prime minister of Canada, to lead a cross-country discussion on the sector's future and a possible course forward. His ensuing report, “Vision 2025,” delivered at the Paris Air Show in June, offered recommendations centred on six core themes: expanding the skilled workforce; growing small- and medium-sized enterprises (SMEs); promoting innovation; investing in Transport Canada's aircraft certification and regulation capacity; sustaining Canadian leadership in space; and better leveraging defence procurement to drive industry growth. The recommendations were drawn from five months of meetings with industry executives, provincial premiers and their economic development ministers, federal ministers, opposition parties, academia and the general public. “Our goal was to re-start the discussion between the industry and its partners in government, education, research and the business community,” Patrick Mann, president of Patlon Aircraft & Industries and the former chair of AIAC, reminded the sector during the recent Canadian Aerospace Summit in Ottawa. “It has been a truly pan-Canadian event that has reached all through the industry . . . [and] into every level of government.” If Charest's report provides a guide for how to address some of the challenges generated by a multitude of countries and technology companies now seeking to gain a larger footprint in aerospace, the task of implementing it rests in part with Keith Donaldson. Donaldson assumed the chair of AIAC during the summit and acknowledged the report will drive much of the association's activities over the next 12 months. “I'm all in on Vision 2025,” he told Skies. “This is the time to re-engage as an industry, to recognize that [aerospace] is a jewel we have in Canada. It's R-and-D intensive, it's pan-Canadian, it has the highest input for STEM (science, technology, math and engineering)-type jobs, men and women – let's grow this. We need the support and partnership of the federal government. That is how we combat [other entrants].” A chartered accountant by training who previously worked with KPMG, Donaldson is vice-president of APEX Industries, a machining, components, subassembly and structures manufacturer in Moncton, N.B. Over his 15 years with the company, he served as president of the New Brunswick Aerospace and Defense Association and co-founded the Atlantic Canada Aerospace and Defence Association. He's also been a fixture on AIAC's technical committees, from audit and finance, to small business, defence procurement and supply chain access. That experience could be crucial, as much of the heavy lifting to make the report's recommendations reality will come from the technical committees. Under Mann's leadership, AIAC spent part of the past year restructuring the committees to align with the direction of Vision 2025. “We spent a lot of time . . . making sure their mandates were going to match the recommendations,” said Donaldson. “We wanted to make sure the chairs were well aligned. [They] are some of the heavy hitters in the industry, from Bombardier, UTC, Cascade, Collins Aerospace . . . [They have] industry interest, company interest and personal interest for the success of these recommendations.” Winning the skills battle Because of ministerial familiarity with the report's recommendations, AIAC will be hoping it can move quickly to implement some of them. The appointment of Qualtrough, who has spoken at previous AIAC conferences, to a portfolio that will focus on the sector's top priority of skills development is seen as “an early win,” Donaldson noted. “When AIAC did the industry engagement, it was very evident that to maintain and grow, we have to win the skills battle,” he said. “A lot of the other recommendations are going to move forward, but we have to solve the skills one. Failure is not an option here.” Other sectors are going to be competing for the same STEM talent, but the Vision 2025 blueprint might give aerospace a leg up with government, he suggested. That means offering ideas not only to retain and retrain the current workforce where necessary, but also to recruit and support more women in the sector, attract First Nations, and collaborate with immigration initiatives. “It is not going to be a one size fits all. We are going to have to work on each one of those areas,” said Donaldson. For APEX, a medium-sized business of about 250 people, 70 of whom work specifically in aerospace, finding and retaining talent is the issue that keeps most senior managers awake at night, he added. The association will also be looking for quick progress on some of the recommendations aimed at strengthening the capacity of Transport Canada. “They are already a world class organization. We are not starting from zero on that one,” noted Donaldson. However, much of the early effort will go to growing SMEs, which account for over 95 per cent of the aerospace sector. It's terrain Donaldson knows well and believes can be improved through initiatives to build on government programs that are already in place. “We are going to be taking what's already working and say, we want to expand some of these programs. That is going to give us some early wins,” he said. One possible tool could be the expansion of Quebec's MACH program, which has provided mentorship from OEMs and Tier 1s to SMEs to help improve business processes and make the transition to digital systems. “From an SME perspective, that program is one of the ways to go because it involves a larger company, the SME, the province, and support nationally,” observed Donaldson. Support and mentoring from larger businesses for digitization and best cyber practices are a critical need for smaller companies, he added, noting that many capture “thousands of pieces of data every day” and don't make as much use of the information as they should. “The new protocol for Cybersecurity Maturity Model Certification in the U.S. is going to be applied to every single company in aerospace and defence, no matter where you are,” he said. “[These are areas] where a MACH-type program could hugely benefit SMEs across the country.” He cautioned, though, that while the emphasis must be on growing SMEs, those small companies often rely on strong OEMs (original equipment manufacturers) and Tier 1 suppliers for their export opportunities. In APEX's case, that's about 50 per cent of the business. “We need to keep the OEMs and large Tier 1s healthy in Canada,” he said. “The MACH [programs] of the world are only going to work well if Pratt & Whitney, Bombardier, Bell, IMP, Magellan, if they grow and invest in Canada. That goes back to a part of the overall Vision 2025.” During separate addresses to the aerospace summit, both Donaldson and Mann appealed to fellow executives to get involved in the process. Committees are the “place where our company can impact and shape the issues that are important to our business,” observed Mann. “There is a lot to making Vision 2025 a reality . . . and we need everyone's help to do that, to make sure aerospace is a key part of our new government's new strategy.” AIAC will continue to lobby the federal and provincial governments on the Vision 2025 recommendations, especially the 48 MPs whose ridings including substantial aerospace activity, and will serve as secretariat to a newly re-created all-party aerospace caucus in Ottawa. Speed is of the essence said Donaldson, noting the pace with which other jurisdictions are growing their aerospace capabilities. “We do not have the luxury [of time],” he said. “It's not like we have Vision 2025 and then there's a whole other plan. Vision 2025 is going to drive the industry. Period.” https://www.skiesmag.com/news/incoming-aiac-chair-discusses-aerospace-vision