Canada's government warned Thursday it could cancel a planned $2 billion purchase of 18 Super Hornet fighter jets from Boeing because of U.S. Department of Commerce anti-dumping investigations against Canadian plane-maker Bombardier.
Canadian Foreign Minister Chrystia Freeland issued the threat in a statement about Boeing's complaint against Bombardier.
"Canada is reviewing current military procurement that relates to Boeing," Freeland said.
Boeing argued at a hearing in Washington on Thursday that duties should be imposed on Bombardier's new larger C Series passenger aircraft, insisting it receives Canadian government subsidies that give it an advantage internationally.
Freeland said Boeing's petition is "clearly aimed at blocking Bombardier's new aircraft, the C Series aircraft, from entering the U.S. market." She said the government strongly disagrees with the Commerce Department's decision to initiate anti-dumping and countervailing duty investigations.
The threat comes amid increasing trade disputes between Canada and the U.S. and on the same day the Trump administration formally told Congress that it intends to renegotiate the North American Free Trade Agreement.
Chicago-based Boeing has petitioned the U.S. Commerce Department and the U.S. International Trade Commission to investigate subsidies of Montreal-based Bombardier's C Series aircraft. Boeing said Bombardier has received more than $3 billion in government subsidies so far that have allowed Bombardier to engage in "predatory pricing."
Brazil has also launched a formal complaint to the World Trade Organization over Canadian subsidies to Bombardier. Sao Paolo-based Embraer is a fierce rival of Bombardier's.
The Quebec government invested $1 billion in exchange for a 49.5 percent stake in the C Series last year. Canada's federal government also recently provided a $275 million loan to Bombardier, which struggled to win orders for its new medium-size plane. But Bombardier was awarded a 75-plane order for the C Series from U.S.-based Delta Air Lines in 2016. Bombardier said its planes never competed with Boeing in the sale to Delta.
The Canadian government said late last year it would enter into discussions with the U.S. and Boeing on buying 18 Super Hornet jet fighters from Boeing on an interim basis and hold an open competition to buy more planes over the next five years.
Canada remains part of Lockheed Martin's F-35 Joint Strike Fighter program.
Canada urged to acquire attack helicopters
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A Senate report is recommending Canada acquire attack helicopters as part of a program to replace its fleet of Bell CH-146 Griffon helicopters.
The recommendation was one of 30 issued by the Standing Committee on National Security and Defence May 8 in a report intended to address what the chair, Conservative Senator Daniel Lang, called “urgent capability gaps.”
The Royal Canadian Air Force (RCAF) has been analyzing options for either the midlife upgrade or complete replacement of its fleet of 95 CH-146 utility transport tactical helicopters. While various possibilities had been raised in briefings to industry and in interviews with media, attack helicopters were never mentioned as part of any plan.
Committee members, however, argued for more effective protection for the Boeing CH-147F Chinook medium- to heavy-lift helicopters, and for soldiers during combat search-and-rescue. It recommended the government prioritize the replacement of 55 Griffons with a military helicopter — the Griffon is a modified variant of the Bell 412 civilian helicopter that struggled in certain conditions during operations in Afghanistan — and add 24 attack helicopters.
The requirement for an attack helicopter like a Boeing AH-64 Apache was identified in discussions with allies. Tech. Sgt. Jorge Intriago Photo
The requirement for an attack helicopter like a Boeing AH-64 Apache was identified in discussions with allies, especially the Netherlands, which found the capability critical to its operations in Mali, Lang explained in an interview with Vertical.
Canada, he noted, is “always looking to somebody else for assistance with [that capability]. If we are going to be self-contained as a military, obviously it is an area we have to look at.”
The report also recommended increasing the Chinook fleet from 15 to 36 helicopters “to support the needs of the army.” The Chinooks are essential to transport light infantry battalions and sustain troops throughout the battle space, and are steadily being integrated into the army’s force employment concept.
Among its other air force-related recommendations, which included immediate fighter jet and air-to-air refueling replacement, the Senate also urged the government to move forward with a proposal to upgrade and expand the fleet of Leonardo (formerly AgustaWestland) CH-149 Cormorant search-and-rescue helicopters by converting seven VH-71 airframes acquired in 2011 for spare parts into working aircraft.
The Chinooks are essential to transport light infantry battalions and sustain troops throughout the battle space, and are steadily being integrated into the army’s force employment concept. Mike Reyno Photo
“The fleet of VH-71s should be modified to match the current capacity of the [Cormorants] and temporarily moved to the east and west coasts to provide additional support for search and rescue while the CH-149 are systematically upgraded,” the report stated.
Accepting the recommendation would increase the Cormorant fleet to 21 and allow the RCAF to eventually station seven on each coast and seven at 8 Wing Trenton, Ontario, which currently operates a fleet of less capable Griffons for search-and-rescue.
Defence Minister Harjit Sajjan also singled out the Griffon and Cormorant midlife upgrade projects for immediate attention during a speech intended to serve as a prelude to the government’s much anticipated defense policy review, expected to be released in the next two weeks before Prime Minister Justin Trudeau attends a NATO heads-of-government meeting on May 25.
In an address to the Conference of Defence Associations Institute on May 3, Sajjan offered a frank assessment of the chronic underfunding of the military and highlighted several equipment programs on a growing list of unfunded projects desperately required by the Canadian Armed Forces.
“We are now in the troubling position where status quo spending on defense will not even maintain a status quo of capabilities,” he said. “Current funding has us digging ourselves into a hole, a hole that gets deeper every year. As a percentage of our GDP, we are spending less on defense today than we were in 2005.”
The Cormorants, he said, meet a critical need and require immediate investment, while the Griffons might have to be “phase out” if funding is not allocated for a modernization program because of parts obsolescence and problems with instrumentation that no longer conforms to North American airspace standards.
The Senate report, the second of two released by the committee in as many months, provided a roadmap to address the strategic challenges facing Canada and to grow defense spending from the current 0.88 percent of GDP to the NATO commitment of two percent by 2028.
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Canada urged to acquire attack helicopters
The easiest fillers for the Mission would be the UH1Y and AH1Z of course that assumes that the Canadians actually make the investment.
They are in active production, no need to heavily modify as they are a finished product and are based off the same family of vehicles used now and the Canadian forces could use the USMC to train them up.
I knew you would protest, but you went in the wrong direction.Why not just buy Reapers? Who are we fighting? We are not gonna fight Russian armours on our soil
and Canada’s multibillion-dollar naval warship project hits another delayWednesday at 8:41 PM
now Bidding on Canadian Surface Combatant program to be delayed, federal government confirms
source:
Hopes that the multibillion-dollar effort to replace the navy’s warship fleet would move along quickly have taken a hit amid word the massive shipbuilding project has suffered another delay.
The federal government launched a competition last fall asking some of the world’s largest defence and shipbuilding firms to design a potential replacement for the navy’s 12 frigates and three destroyers.
Companies were given until the end of April to submit their designs, after which one would be selected and constructed by Halifax-based Irving Shipbuilding.
Government officials warned at the time that there was little room for delays or other hang-ups.
But the federal public procurement department, which already extended the submission deadline by two months in February, says the companies have now been given even more time to enter their designs.
How much time?
“A new submission deadline will be communicated to the bidders shortly,” Public Services and Procurement Canada spokesman Pierre-Alain Bujold said in an email.
Officials say the latest extension was needed to finish answering the approximately 560 questions that participating firms have asked the department about the bidding process since the competition started.
But this latest delay in what is the largest military procurement project in Canadian history, with a value of up to $40 billion, is cause for concern, given past assertions about the need for speed.
The navy recently retired all its destroyers, meaning fewer ships to patrol Canada’s coasts and operate overseas, as well as a shortage of air-defence capabilities, until the new vessels arrive in the mid-2020s.
But more importantly, government officials said in October that they wanted Irving Shipbuilding in Halifax to begin work on the new warships as soon as it finishes the last of five new Arctic patrol ships in 2019.
Officials have said a gap, which currently sits at about two years as work on the warships isn’t expected to start until 2021, would cost tax dollars as workers and equipment sit idle and material costs go up.
“From a program perspective, we have not a lot of flexibility,” Patrick Finn, the head of military procurement at the Department of National Defence, said in October.
“Right now, schedule is very important for us. There are some risks emerging that we need to deal with.”
Irving president Kevin McCoy has also since warned of “significant layoffs” at the Halifax shipyard, unless the gap is closed or the government provides it with more work.
Bujold said minimizing the gap remains a high priority for the government and Irving and that “the extent and impact of the gap will continue to be analyzed and potential mitigation actions examined.”
Irving spokesman Sean Lewis echoed that assessment, saying in a statement that the company was working with the government “towards minimizing any disruption to the workforce” because of the gap.
“It is important that we take time to listen to the short-listed bidders and respond to their questions,” Lewis added. “This will ensure they are able to submit a thorough and well-informed response.”
Irving was selected in 2010 to construct between six and eight Arctic patrol vessels for $2.3 billion and 15 warships, known in defence circles as Canadian surface combatants, for $26 billion.
Both projects have since been amended due to scheduling and cost issues. Irving is now committed to building five Arctic ships, though it may add a sixth.
Meanwhile, the Liberal government has said it will not discuss a price or how many warships it will buy until more information is available, after documents pegged the cost at closer to $40 billion.
while Cost of Canadian Surface Combatant put at more than $61 billion – PBO studyFeb 18, 2017
and Canada’s multibillion-dollar naval warship project hits another delay
Despite past assertions about the need for speed, the procurement department has again delayed a key submission deadline in the race to replace the navy’s 12 frigates and three destroyers
May 29, 2017
Canada’s new fleet of warships will cost almost $62 billion, according to a new study by the Parliamentary Budget Officer.
The original budget for the CSC program was $26.2 billion, or $1.7 billion per ship for 15 ships. The vessels are to replace the current Halifax-class frigates and the Iroquois-class destroyers.
But Jean-Denis Fréchette , the Parliamentary Budget Officer, estimates that the program will cost $61.82 billion, or $4.1 billion per ship for 15 ships. Therefore, it is estimated the ships will cost roughly 2.4 times more than originally budgeted, the PBO added in a report released Thursday.
This estimate includes costs resulting from development, production, spare parts, ammunition, training, government program management and upgrades to existing facilities. It does not include costs associated with the operation, maintenance and mid-life refurbishment of the ships, other than the spare parts that will be purchased when the ships are built, the PBO noted.
“PBO estimates that for the program to stay within the original budget of $26.2 billion (then-year dollars), the government could build only six ships,” the study added.
The PBO also estimated the cost due to inflation for delaying the awarding of the contract after 2018. “We estimate that for each year of delay, the program would cost about $3 billion more,” Fréchette noted in the study.
and Canada's defense minister threatens Boeing deal in speechinterestingly
Canada warns it may cancel US Super Hornet jet buy over probe
source:Canada's defense minister repeated a threat Wednesday to cancel the purchase of 18 fighter jets from Boeing because of the company's trade complaint against Canadian plane-maker Bombardier.
Harjit Sajjan said Boeing's action against Bombardier is "unfounded" and not the behavior of a "trusted partner." He said buying the Super Hornet fighter jets "requires a trusted industry partner."
Sajjan urged Boeing to withdraw the complaint in a speech. Canada's foreign minister has also threatened to block the order.
"Our government — and I stress this —T our government is disappointed in the action of one of our leading industry partners," he said.
Chicago-based Boeing's trade complaint prompted a U.S. Commerce Department anti-dumping investigation that could result in duties being imposed on Bombardier's new larger C Series passenger aircraft. Boeing insists the plane receives Canadian government subsidies that give it an advantage internationally.
Canada's threat comes amid increasing trade disputes with the U.S.
Scott Day, a spokesman for Boeing, noted that Sajjan also recognized Boeing as a strong partner in the past and for the future. Day defended the company's trade action.
"This is a commercial matter that Boeing is seeking to address through the normal course for resolving such issues," Day said in an email.
Boeing petitioned the U.S. Commerce Department and the U.S. International Trade Commission to investigate subsidies of Montreal-based Bombardier's C Series aircraft. Boeing says Bombardier has received more than $3 billion in government subsidies that let it engage in "predatory pricing."
Brazil has also launched a formal complaint to the World Trade Organization over Canadian subsidies to Bombardier. Sao Paolo-based Embraer is a fierce rival of Bombardier's.
The Quebec government invested $1 billion in exchange for a 49.5 percent stake in the C Series last year. Canada's federal government also recently provided a $275 million loan to Bombardier, which struggled to win orders for its new medium-size plane. But Bombardier won a 75-plane order for the C Series from U.S.-based Delta Air Lines in 2016. Bombardier said its planes never competed with Boeing in the sale to Delta.
The Canadian government said late last year it would enter into discussions on buying 18 Super Hornet jet fighters from Boeing on an interim basis and hold an open competition to buy more planes over the next five years. Canada remains part of Lockheed Martin's F-35 Joint Strike Fighter program. Sajjan said he would have more to say about the issue next week.