Will other firms withdraw from fighter jet competition leaving F-35 last plane standing?

By DAVID PUGLIESE, OTTAWA CITIZEN

Shortly before he retired, Pat Finn, the Department of National Defence's procurement chief, told this newspaper there was always a risk that some companies would drop out of the future fighter jet competition but that extra efforts had been made to ensure the process was fair. “We're not getting all kinds of signals that (companies are) losing interest” in bidding, Finn said in an interview July 23.

On Aug. 30, the United Kingdom's Ministry of Defence and Airbus Defence and Space informed the Canadian government of their decision to withdraw from Canada's future fighter competition. Airbus had been offering Canada the Eurofighter.

At the time the Canadian Press news service reported the Eurofighter withdrawal was a surprise.

It wasn't.

For the last nine months the various competing firms, Boeing, Airbus and Saab have been sounding the alarm about how the fighter jet process is structured and their worry that it is stacked in favour of the Lockheed Martin F-35. The RCAF, which originally selected the F-35 as the CF-18 replacement before that selection was put on hold by the previous Conservative government because of cost and technical issues, came up with the new requirements. Industry representatives say these requirements highlight the strengths of the F-35 such as stealth and a first strike capability.

The primary role of the new fighter jets is to protect North America, or so government officials have said. Lockheed Martin's industry rivals question how stealth and a first strike capability fit into that role.

Representatives from Lockheed Martin's competitors have also made overtures to federal officials about their concerns about the procurement process but say they received little response.

In early July Reuters news service reported that both Airbus and Boeing were considering dropping out. Airbus followed through on its concerns and as noted decided it wasn't worth competing because of how the process was designed.

Last year the European firm Dassault informed the Canadian government it would not be competing in the competition. It had been planning to offer Canada the Rafale fighter jet.

There were two key changes in the $19 billion procurement that caused Airbus to leave. One was the decision to change the industrial benefits needed for the program. Airbus was willing to outline and guarantee specific industrial benefits for Canada. That was the way previous defence procurements had worked.

But that has been changed because of concerns the U.S. government raised for Lockheed Martin.

U.S. officials had warned that the F-35 development agreement Canada signed years ago prohibits partners from imposing requirements for industrial benefits. Although Canada is a partner in the development of the aircraft that does not stipulate it is required to buy the F-35. But under the F-35 agreement, partner nations such as Canada are prohibited from demanding domestic companies receive specific work on the fighter jet. Instead, Canadian firms compete and if they are good enough they receive contracts. Over the last 12 years, Canadian firms have earned more than $1.3 billion in contracts to build F-35 parts. But there are no guarantees.

The other problem that Airbus and Rafale faced was linked to the requirement that bidders need to show how their aircraft will integrate into the U.S.-Canada system to defend North America. Airbus would have been required to show how it planned to integrate the Eurofighter Typhoon into the U.S.-Canadian system without knowing the system's full technical details, the Canadian Press news service pointed out.

Saab, which is offering Canada the Gripen fighter, could be facing the same problem.

Boeing, which is considering offering the Super Hornet, would not have such a problem as its aircraft is being flown by the U.S. military.

It is still unclear, however, whether Boeing or Saab will even continue in the competition.

Bids must be submitted by the spring of 2020 but there is a growing sense among the defence industry that the F-35 will ultimately be selected as the new aircraft for the RCAF.

https://ottawacitizen.com/news/national/defence-watch/will-other-firms-withdraw-from-fighter-jet-competition-leaving-f-35-last-plane-standing