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A third of the companies involved in a $26 billion project to build a new fleet of warships for Canada have asked the Liberal government to delay bidding as problems continue to mount for the program.

On Monday the Ottawa Citizen reported that one of the world’s largest shipbuilders – Fincantieri -had told procurement minister Judy Foote the project was so poorly structured it had doubts whether it would bid.

Foote’s department has now confirmed that four firms have come forward to request the bidding process for the Canadian Surface Combatant be delayed.

Canada has pre-approved 12 firms to bid on various aspects of the program which would see Irving Shipbuilding construct a fleet of new ships for the Royal Canadian Navy.

“Canada and Irving Shipbuilding Inc. are considering the extension requests,” Jean-François Létourneau, a spokesman for Public Services and Procurement Canada, noted in an email.

He did not identify the companies requesting the delay.

The Liberal government announced Oct. 27, 2016 that Irving had issued a request for proposals from companies on the design of the new warships.

The firms have until April 27 to provide those bids, which must not only include the design but details of teaming arrangements with Canadian firms.

Allowing only six months to compile bids for one of the largest procurements in Canadian history doesn’t make sense, say representatives of some of the companies. The extent of the technical data and other information the Canadian government requires is overwhelming.

Fincantieri’s letter to Foote provided a detailed outline of other problems with the acquisition process, warning that, “Canada is exposed to unnecessary cost uncertainty.”

There is also the belief in industry circles the Liberals are favouring the design from the British firm BAE, which is offering the navy the Type 26 warship.

Foote had previously said only proven warship designs would be considered to reduce the risk of problems. But the Liberals retreated on that and will now accept a Type 26 bid, even though the vessel has not been built yet.

Over the last several months, various firms have highlighted their serious concerns about the project but are frustrated Foote has not acted to deal with those, industry sources added.

But Foote’s spokeswoman Annie Trépanier said industry has been repeatedly consulted on the project and an independent fairness monitor is involved in the process.

Irving spokesman Sean Lewis said the contract for the design would be awarded to an existing warship design that best fits the requirements of Canada’s navy. All bidders are being treated equally and no one bidder has an unfair advantage, he added.

Industry officials aren’t the only ones raising concerns. In December 2015, Vice Admiral Mark Norman told CBC journalist James Cudmore the Canadian public had not been given accurate information about the growing price of the ships. Norman warned the project, originally budgeted at $26 billion, could end up costing taxpayers $42 billion.

Cudmore is now a procurement advisor for Defence Minister Harjit Sajjan.

Norman was temporarily removed from his job as vice chief of the defence staff on Jan. 13 by Chief of the Defence Staff Gen. Jon Vance. The government and military have declined to provide a reason for the removal of Norman from his position as the second highest-ranking officer in the Canadian military.

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Canadian Forces looking to replace Second World War-era pistols but it could take another 10 years

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Canada says it's satisfied with the terms of its Canadian Surface Combatant project following criticism from Italian shipbuilder Fincantieri.

“We will always consult with industry, and that is why we were successful in terms of the CSC,” Public Services and Procurement Minister Judy Foote said. “The fact that some people are questioning it is something we’ll look at, but in reality, of the 12 primes, eight have not expressed any issue with respect to the deadline.”

Fincantieri had warned the Canadian government that it won’t bid on a new program to build a fleet of future surface combatants unless significant changes to the project are made and foreign firms are given more of a role.

Foote is facing pushback from a number of firms eligible to bid on the Canadian Surface Combatant, or CSC, a project worth more than CAN $26 billion (US $19 billion).

Four of the 12 companies preapproved for bidding by the government have requested that Canada delay bidding. At this point, the firms have a deadline of April 27 to provide their bids to Canada.

Foote never responded to Fincantieri, but she told journalists that she is not worried about the state of the CSC project or the fact that four companies have asked that bidding be delayed.

Public Services and Procurement Canada declined to release the names of the companies requesting a delay in bidding.

Other representatives from various companies have privately voiced concern about the viability of bidding on the CSC project.

Fincantieri put its concerns in writing to Foote: “The proposed contract structure severely discounts the value of the CSC project to WD (Warship Designer) Bidders, and in the case of Fincantieri, it makes taking a decision to bid very problematic."

The letter was written on Oct. 24, 2016, but recently obtained by Defense News.

Fincantieri declined to comment.

Under the program, Irving Shipbuilding of Halifax is the government’s prime contractor and will be responsible for building the ships. Foreign companies are expected to provide the design and combat systems.

Jean-François Létourneau, a spokesman for Public Services and Procurement Canada, said the requests for extensions are being considered but no decision has yet been made.

In its letter to Foote, Fincantieri stated that the current structure of the CSC procurement provides only a minor role for warship designers who are required to provide engineering and design services to Irving, which will then build the warships.

There is little financial incentive for that role.

“In return for this limited scope of work, the (Warship Designers) are being asked to provide valuable Intellectual Property, Technology Transfer, and access to established supply chains, all under excessively demanding terms and conditions,” Fincantieri told Foote.

In addition, the warship designers have to provide a warranty on the integration of technology into their designs, even though they are not responsible for buying those systems, Fincantieri stated.

Defence sources say while the Canadian government may delay bidding, it will likely not extensively change the structure of the procurement.

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Jura said:

according to DefenseNews Canadian minister defends naval project after Fincantieri criticism

source:

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The submission of bids for a new fleet of future warships for the Royal Canadian Navy will be delayed, the federal government has confirmed.

Companies were to submit their bids on the Canadian Surface Combatant project by April 27 but a third of the firms approved by the Liberal government to submit proposals had requested extensions.

Bids are now due June 22, Public Services and Procurement Canada said in a news release.

“In order to meet the requirements of the Royal Canadian Navy and provide economic benefits to Canada it is important to ensure that the government receives the maximum number of bids that meet technical requirements and offer high quality economic benefits to Canada,” the department noted in its release.

“At this point, based on feedback from industry, an extension is the best course of action.”

Last week the Ottawa Citizen revealed that a third of the 12 companies involved in the project, which will cost at least $26 billion, had asked the Liberal government to delay bidding. They warned government that allowing only six months to compile bids for one of the largest procurements in Canadian history didn’t make sense. The extent of the technical data and other information the Canadian government required was overwhelming, company representatives added.

At the same time, the six-month bidding period didn’t allow enough time to make arrangements with Canadian companies to be part of the bids, defence sources said.

A winner is expected to be announced sometime in the fall of this year. Construction of the vessels is expected to start in the early 2020s.

The extension follows comments from Procurement Minister Judy Foote to journalists Feb. 7 suggesting the Canadian Surface Combatant program was running smoothly. “We will always consult with industry, and that is why we were successful in terms of the CSC,” Foote said. “The fact that some people are questioning it is something we’ll look at, but in reality, of the 12 primes, eight have not expressed any issue with respect to the deadline.”

Defence industry sources say problems have also emerged because the federal government and Irving Shipbuilding, the prime contractor for the project, have not been answering key questions. Bidders have submitted 164 questions about the program but so far have only received 88 answers, Public Services and Procurement Canada also confirmed.

In addition, one of the world’s largest shipbuilders – Fincantieri -had told Foote the project was so poorly structured it had doubts whether it could bid unless significant changes were made.

But in an email to the Citizen, Lucas Maglieri, a consultant for Fincantieri, stated that the company, “remains interested in doing business in Canada and in the CSC project – we continue to assess our options for the Canadian marketplace.”

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Canada confirms Super Hornet procurement plan

By Ryan Maass and Richard Tomkins | Updated March 15, 2017 at 3:16 PM

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Canada's letter of intent to buy F/A-18 Super Hornets from the United States follows months of negotiations between the two governments. U.S. Navy photo by Mass Communication Specialist 2nd Class Z.A. Landers


March 15 (UPI) -- Canada's government formalized its plans to purchase Super Hornet fighter jets from the United States when it issued a letter of intent to the U.S. on Tuesday.

The letter follows

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between Canadian Prime Minister

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's Liberal government, U.S. defense officials and Boeing representatives. Canada's request calls for the procurement of 18 F/A-18 Super Hornet aircraft.

Trudeau's government

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a potential Super Hornet buy in November 2016 as a temporary solution for replacing the country's aging fighter fleet, opting to distance itself from the Lockheed Martin-led F-35 program.

While Canada maintains the procurement is a temporary solution until an open and transparent competition can be initiated to replace the country's CF-18s, defense officials say the decision marks notable progress toward a permanent replacement.

"Today's announcement shows important progress toward getting the brave women and men of the Canadian Armed Forces the equipment they need to protect Canadians and Canadian values around the world," Canadian National Defense Minister Harjit Sajjan said in a

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. "We will assess whether an interim Super Hornet fleet purchase will help ensure Canada remains a credible and dependable ally for many years to come."

Canada's next step for the procurement will involve further negotiations with Boeing and other suppliers to develop an official proposal. The country expects an official response from the U.S. in the early fall of 2017.

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vincent said:

Wonder what the price for the super bug will be

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TerraN_EmpirE said:

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SinoSoldier said:

I did a rough calculation a while back, which showed that the Super Hornets would actually be more expensive than the F-35s (the latter of which is far more capable) on a per-unit basis, and would one day have to be replaced by, you guessed it, the F-35.

Liberal bureaucracy is an art form few understand.

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