The shell game
Artillery is back in the news today, with the potential purchase of even more M777 for the CF:
This is promising. As any infanteer will tell you, accurate indirect fire can be a very, very good thing - if you have it and the enemy doesn't. The CF's ability to support its troops in the field with artillery is extrememly important, since it saves soldiers' lives by killing the bad guys at a distance so we don't have to risk our own as much up close. One of the smartest purchases the previous Liberal government authorized was the M777 on a fast-track basis.
If you read further down in the article, though, you find an interesting tidbit:
Wait a minute. Wasn't it $150,000 apiece just a week ago?
How tough is it to find out the real price, with some qualifying statements (eg. "Test rounds purchased on a low-volume contract cost the CF $150K apiece, but it's anticipated the price will drop to a third of that once full production ramps up in 2008, assuming the CF purchases a minimum of 1000 shells" - I'm making up the details, but you get the idea)? Bueller? Anyone?
The army is impressed with the performance of its new, British-built M-777 heavy guns, six of which were purchased directly from the U.S. Marine Corps last winter.
The Defence Department is now negotiating with BAE Systems Inc. to buy six more of the 155-mm artillery pieces in the short-term and possibly an additional 15 over the long-term, said one source.
This is promising. As any infanteer will tell you, accurate indirect fire can be a very, very good thing - if you have it and the enemy doesn't. The CF's ability to support its troops in the field with artillery is extrememly important, since it saves soldiers' lives by killing the bad guys at a distance so we don't have to risk our own as much up close. One of the smartest purchases the previous Liberal government authorized was the M777 on a fast-track basis.
If you read further down in the article, though, you find an interesting tidbit:
This fall, a new type of projectile called Excalibur was introduced.
The GPS-guided shell allows gunners to drop shells into a 10-metre circle at ranges up to 40 kilometres, but it's an expensive system, with each round costing US $30,000.
Wait a minute. Wasn't it $150,000 apiece just a week ago?
How tough is it to find out the real price, with some qualifying statements (eg. "Test rounds purchased on a low-volume contract cost the CF $150K apiece, but it's anticipated the price will drop to a third of that once full production ramps up in 2008, assuming the CF purchases a minimum of 1000 shells" - I'm making up the details, but you get the idea)? Bueller? Anyone?
posted by Babbling Brooks at 11:38 a.m.
2 Comments:
That variable pricing is not at all uncommon Damian. Typically they include R&D and line startup costs into the per-unit cost, which is why stuff like the B-2A are a few billion a copy. When you spread out that cost across 100 or so aircraft it gets a lot smaller per copy. When it's all concentrated in just 20 birds then it's huge.
The munitions guys probably follow similar logic and right now their per-unit cost is probably 150K but will drop with a larger production run.
Murray Brewster, who wrote that howitzer story, is a terrific reporter but in the version I saw he did not identify the source for his cost of shells. I did: It was the Minister of National Defence in the House of Commons with the CDS and the Deputy Minister at his elbow. Until the MND gives us a new figure, we're sticking with $150,000 a shell ...
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