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Canada's screwed up warship competition


Argus

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I post this in part because it's exactly the kind of journalism we ought to expect on a regular basis but rarely get. It's a long piece about how we came to be saddled with a super expensive, unproven warship design despite earlier intentions to only allow proven warships which had already been built to be in the competition. Reading between the lines, the competition was fiddled by both Tories and Liberals to get the company which probably has made a lot of promises of financial support to individuals down the line. The $14 billion for warships became $30 billion which became $60 billion and the risk is now that it's headed for $80 billion, without a single ship having even been started. And along the way the government watered down the requirements for this incredibly expensive warship because it couldn't meet the original requirements - unlike its cheaper competitors.

One particularly interesting part of the piece concerns the US navy. They also solicited bids for a proven warship design. Because the Type 26 we chose has never been built it wasn't allowed to compete.

The U.S. competition to acquire a future frigate began in July 2017 and in April 2020 the U.S. Navy selected Fincantieri’s FREMM design, the same vessel rejected by Canada as part of the fixed-price proposal. Ten FREEMs would be built in the U.S., with the first ship estimated to cost the equivalent of $1.7 billion Canadian. The other ships to follow are expected to be built at significantly less cost, according to the Pentagon.

So the US will buy 10 frigates at likely $1.5 billion or less apiece, and probably have them all delivered before us, despite starting years later. And the likely cost of ours will be about $4 billion each - the most expensive frigates on earth by a long ways. And who's going to be happy about this? Well... Irving will, and that's all that seems to be important. We could have had the FREEM design done at a fixed prices of $30 billion. Now we'll be paying $50 billion MORE on top of that for a design which doesn't even meet the requirements we set out.

https://ottawacitizen.com/news/national/defence-watch/billions-in-trouble-how-the-crown-jewel-of-canadas-shipbuilding-strategy-became-a-possible-financial-disaster-waiting-in-the-wings

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4 hours ago, Argus said:

So the US will buy 10 frigates at likely $1.5 billion or less apiece, and probably have them all delivered before us, despite starting years later. And the likely cost of ours will be about $4 billion each - the most expensive frigates on earth by a long ways.

 

Not a fair comparison....the U.S. Navy has continuous shipbuilding programs at multiple yards based on domestic and foreign designs that keep costs lower. 

Canada all but starved it's shipyard capacity and capabilities out of existence and is starting nearly from scratch.   Plus Canada has to pay a premium for foreign made propulsion components, combat systems, etc.

With fewer yards and less competition, Canadian taxpayers pay more, and the politics of jobs and wonky defence procurements will make sure that is so.

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2 hours ago, sharkman said:

You can thank your liberal party, Argus...

Are you trump cultists going to show up to sulk and whine every time I post now? It's like you can't believe a conservative wouldn't support your god emperor  just because he's a slimy, ignorant, crooked, bullying scumbag. Well, sorry, but apparently I have standards, morals and ethics which are far higher than yours.

Edited by Argus
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1 hour ago, bush_cheney2004 said:

 

Not a fair comparison....the U.S. Navy has continuous shipbuilding programs at multiple yards based on domestic and foreign designs that keep costs lower. 

Canada all but starved it's shipyard capacity and capabilities out of existence and is starting nearly from scratch.   Plus Canada has to pay a premium for foreign made propulsion components, combat systems, etc.

With fewer yards and less competition, Canadian taxpayers pay more, and the politics of jobs and wonky defence procurements will make sure that is so.

This isn't just a lack of expertise. This is bad decision making and bad processes. Note that the US began searching for a frigate and then cut a contract two and a half years later. Canada STILL hasn't signed a contract with BAE after what, twelve years now?

Plus we had the opportunity to get the same warship the US is buying on a fixed cost basis a couple of years ago which would have meant the total package would have cost $30 billion. Instead it's over $60b now and headed for $80b

Edited by Argus
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1 minute ago, Argus said:

This isn't just a lack of expertise. This is bad decision making and bad processes. Note that the US began searching for a frigate and then cut a contract two and a half years later. Canada STILL hasn't signed a contract with BAE after what, twelve years now?

 

Decisions were made to purposely let Canada's capabilities dwindle, regardless of ruling party/government....this goes back many decades, and is part of Canada's defence spending resistance and political combat.   Ships, aircraft, mechanized armour...doesn't matter.

 

Quote

Plus we had the opportunity to get the same warship the US is buying on a fixed cost basis a couple of years ago which would have meant the total package would have cost $30 billion. Instead it's over $60b now and headed for $80b

 

Canada always wants to customize platform designs to its own liking, driving up costs.

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2 minutes ago, bush_cheney2004 said:

Canada always wants to customize platform designs to its own liking, driving up costs.

As noted in the story, the FREMM design would have needed very few and inexpensive changes. The Type 26, on the other hand, needs major ones. And even then it won't meet the requirements stated in the RFQ.

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2 minutes ago, Argus said:

As noted in the story, the FREMM design would have needed very few and inexpensive changes. The Type 26, on the other hand, needs major ones. And even then it won't meet the requirements stated in the RFQ.

 

Defense contractors know better over decades of dealing with Canada's dysfunctional and partisan military procurement processes.   

No bid !!

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1 minute ago, bush_cheney2004 said:

 

Defense contractors know better over decades of dealing with Canada's dysfunctional and partisan military procurement processes.   

No bid !!

Except they did bid, and would have locked in the price.

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There is many rumors within DND, that our great ship building exercise might not happen. And those rumors are coming from near the top, Navy is getting really nervous , they know that 80 bil program will be prime targets for Justins crew. The Airforce are also very worried about their fighter replacement program as well another 20 bil program.

Besides would this surprise anyone, not really Canadians have not seen to the protection of its military in a very long time, lets see social programs that give them money or having a military able to protect this nation...

The Type 26 is suppose to be the frigate of the future, excels in ASW which for some reason our navy considers themselves experts on, or more to the point it is one capability we have not really gotten rid of YET.

On the bright side we have most of the patrol frigs, you know the ones the navy wanted to give to the coast guard..

Canada gets more out of their military than they pay for, and it's been at the cost of many vital capabilities, capabilities that are needed to defend this nation, and or carry out Canada's foreign policy. But like I said we will get what we pay for, and Canadians will be fine with that. 

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1 hour ago, Argus said:

Are you trump cultists going to show up to sulk and whine every time I post now? It's like you can't believe a conservative wouldn't support your god emperor  just because he's a slimy, ignorant, crooked, bullying scumbag. Well, sorry, but apparently I have standards, morals and ethics which are far higher than yours.

Yeah, I've been stalking you for days and posting after every single post you make, not!  Try to turn that frown upside down, brother, your stomach will thank you.

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  • 2 weeks later...

It seems that the Liberals are at it again, it seems the system they brought in for procurement to provide Canadians total accounting for 40 years... has the cost of our frigs have gone ballistic.

What started out as a conservative government estimate, did not include the predicting costs for 40 years, a retarded policy to start with, it is at most a guess, with most of those costs already budgeted some place else, it's invention was to scare voters into having the project shut down. 

Under pressure from the liberals to recalculate total price, taking into account how delays have effected the total cost, they raised it to 56-60 bil...but it still does not take into account the 40 year cycle....213 to 219 bil... does everyone see where this is going, someone is making it easier to cancel the entire project... i wonder if the total number of ships get built or if capabilities meaning quality get cut... 

It also clearly shows us that military procurement is not to provide the military with equipment they need , but rather a make work project to spread wealth around here in Canada. 

   

The U.S. experience

Williams argues a better comparison would be with the planned U.S. navy future frigate program (FFG-X), which he said will deliver warships of equal quality in less time and at a better price.

He noted that the average cost per ship for the nine FFG-X ships is $1.2 billion. In contrast, Williams said the average production cost for each of the 15 CSC ships is estimated at $3.5 billion — "2.76 times more expensive," he wrote. 

He also blamed the estimated price tag on the method Canada chose to build the warships — the National Shipbuilding Strategy.

 Battle of the budget: DND gears up to defend cost of new warships in the new year (msn.com)

 

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Here is the new CDS, a Navy guy, for good reason, he is the guy that is going to have to fight for 15 ships and the extra bils it is going to cost... And who better to explain to the public why the slash in total ships numbers or capabilities of each ship.

 

Navy commander Art McDonald tapped to steer Canadian military as new defence chief (msn.com)

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  • 2 weeks later...

Defence procurement in this country is insane, with each party blaming the other one for its mistakes, yet the sad reality is the problem is not the politicians, but the Canadians who vote for them. 

Defence spending and procurement have been neglected for decades because each side wants other things more. The left wants more spending on social programs, while the right demands deeper and deeper tax cuts. So where does the money come from? Why the biggest single departmental expense in the federal budget - national defence of course.

Canadians themselves have voted selfishly for decades and even the war in Afghanistan didn't change that, aside perhaps for a few thousand people who watched from highway bridges as Canada's fallen came home from that conflict.  

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On 12/10/2020 at 2:38 PM, Argus said:

As noted in the story, the FREMM design would have needed very few and inexpensive changes. The Type 26, on the other hand, needs major ones. And even then it won't meet the requirements stated in the RFQ.

The Type 26 is a larger more capable ship than the FREMM. Not really even a frigate, it's 50% heavier than the existing Halifax class and larger than the Tribal Class destroyers we used to have. 

 

Australia is building 9 TYPE 26 ships, Hunter Class at a cost of $35B AUD.

 

"the GCS-A design was selected because it was the most capable ASW platform.

“This is a decision entirely based on capability, the best capability to equip the Navy in anti-submarine warfare”

 

The Hunter-class frigates will be equipped with CEA Technologies-built CEAFAR phased array radar currently fitted to the Navy’s post-anti-ship missile defense Anzac frigates, together with Lockheed Martin’s Aegis combat system and an interface provided by Saab Australia.

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1 hour ago, Aristides said:

The Type 26 is a larger more capable ship than the FREMM. Not really even a frigate, it's 50% heavier than the existing Halifax class and larger than the Tribal Class destroyers we used to have. 

I accept they are better - or will be, presuming they can iron the kinks out. Are they more than twice as good? Because it looks like we could have bought 30 of the FREMMs for the price of 15 Type 26 and still had billions left over.

Also, the US is about to build 9 FFG-X frigates with the same capability for one third the price per ship

https://www.cbc.ca/news/politics/navy-frigates-cost-1.5851912

 

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1 hour ago, Argus said:

I accept they are better - or will be, presuming they can iron the kinks out. Are they more than twice as good? Because it looks like we could have bought 30 of the FREMMs for the price of 15 Type 26 and still had billions left over.

Also, the US is about to build 9 FFG-X frigates with the same capability for one third the price per ship

https://www.cbc.ca/news/politics/navy-frigates-cost-1.5851912

 

Maybe but whatever we buy we will be using it for more than 30 years so it better be capable and adaptable to any future needs. Same goes for the fighters. People have been talking about the age of the CC-150 Polaris fleet and the need to replace it, they are newer than our F-18's

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Rumors are already floating around DND about cuts to existing procurement programs, including the ship building project and the new fighter program... with our nation in massive debt DND has been historically the first stop in government cuts. This will go done with out a whimper from the Canadian public, as long as they don't F*** with social programs. What Canadians don't realize is DND is as close to rusting out than ever, major capabilities are on the verge of becoming obsolete such as our naval ships, fighter fleet, even the army is saddled with older equipment .

Once these capabilities are gone or allowed to fad into the night , historically they are gone forever, deemed not affordable... so with cut backs in the wind, DND will sacrifice capabilities, such as gen 4 fighters, or Type 26 without all the shinny gadgets inside as well as cut in the numbers..

One morning Canada is going to wake up, and it's military will have not be capable of any real military mission.. and that is not so far away and a lot of capabilities are already gone with no replacements in sight..

DND procurement has been turned into a national employment program, or contracts require offsets being as much as the contract is worth, Companies can't make money with those Canadian contracts, they try and stay away from Canadian contracts as much as possible..  All the red tape that was created was to make it difficult to spend on the military, or for that matter any of Canada's security apparatus. We don't see any of that red tape when creating social programs. 

      

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8 hours ago, Aristides said:

Maybe but whatever we buy we will be using it for more than 30 years so it better be capable and adaptable to any future needs. Same goes for the fighters. People have been talking about the age of the CC-150 Polaris fleet and the need to replace it, they are newer than our F-18's

The PM does not ride around in a F-18, thats why the CC-150's are being brought up...

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  • 3 weeks later...

I decided to add this here even though this has nothing to do with warships. But it does have to do with the navy, our screwed up government, and the ludicrous prices we have to pay which seem many times greater than what other countries pay for their own ships.

You will require that Irving - the worst, slowest, most incompetent, most expensive shipbuilding company on planet earth - ever - tried to get the Liberals to cancel the plans to have Davie Shipbuilding put together a civilian resupply ship for the navy. This led to charges against then head of the navy Admiral Norman because the press found out, charges eventually thrown out after DND revealed just how lacking in honor, integrity and honesty they were.

The ship was completed on time and on budget - which is why you know Irving had nothing to do with it. The official navy supply ships are being built by Irving, and so, of course, are way overdue and way overbudget. The first was to be delivered in 2017. The new hoped-for delivery date is 2023. I remind you these ships are supply ships. Oh, and they're twice as expensive. The navy will now pay over $2 billion apiece. For supply ships.

Davie Shipbuilding bought the MV Asterix from a Liberian shipper for about $20 million and then spent about a hundred million refurbishing it. I haven't been able to find any indication the new planned ships are any better than the Asterix. Just a lot more expensive. Davie offered to refurbish a second ship, but Trudeau, with his orders from Irving firmly in hand, refused.

https://ottawacitizen.com/news/national/defence-watch/canadian-navy-using-leased-supply-ship-more-often-contract-boosted-by-71-million

http://www.davie.ca/resolve-frequently-asked-questions/

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  • 3 weeks later...

So this is a new one. You know that plan for us to build new navy frigates because ours are rusting out? The ORIGINAL plan was to spend $14 billion on these warships. In 2008 they changed this to $26.8b. It took FOUR YEARS to figure out it would be built by Irving Shipbuilding and so the contracts were signed in 2012. The frigate was to be selected by 2014. It still hasn't been.

In 2016, the Liberals who were indignant at the navy refusing to provide information to the PBO while they were in opposition, changed 180 degrees once in office and announced no cost estimates or information would be given to the public on the program and issuing gag orders to everyone involved. Nevertheless, the PBO released his estimate of $61 billion in 2017. Shortly afterward the Liberals said the true estimate was $56 billion.

The Liberals also selected a guy to head the hunt for the ships who used to work for BOA in the UK. Surprise! The committee selected an unproven BOA design despite the fact the bidding process specifically said only proven designs could be submitted! I wonder how much money changed hands over that one? Anyway, the Liberals eliminated that requirement, probably for a tidy sum flowing into various Swiss bank accounts. Especially since they also watered down the requirements for the ships.

A French-Italian consortium said they would build their proven design for a set price of $30 billion - half the cost of the BOA design, but were rejected. Obviously they didn't offer the proper bribes. Oh, and the cost is now jp to $70 billion.

All of which brings us to a report yesterday, which is that the ships are now another 5 years behind schedule. Further, DND doesn't know why, nor does it know when it figured out they were another 5 years behind schedule. The first ship will now be delivered in about ten years. Approximately. As far as they know. Unless there are more delays.

This program began in 2008. The money was allocated and the first contracts signed in 2012. It's going to take EIGHTEEN YEARS from then to get the first ship. And DND doesn't know why it's behind schedule.

https://ottawacitizen.com/news/national/defence-watch/dnd-unable-to-say-exactly-when-delays-in-70-billion-warship-program-began

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