Talk about headline spin: "Canadian Forces To Receive Helicopter Fleet With Leading Edge Technology"/Upperdate: Cormorants

The government has caved in to Sikorsky (the title headline, at the link, is so, er, "Canada's New Government"--hurl). What a balls up:

Sea King replacements to start rolling out in 2010

Canada's air force will take delivery of its first new maritime helicopter in half a century by November 2010, two years behind schedule and with changes that will cost $117 million [emphasis added].

Defence sources tell the Canadian Press that a deal with U.S. defence contractor Sikorsky was concluded recently.

It resulted in a firm delivery date for the first of 28 CH-148 Cyclones, which were initially supposed to start flying from the decks of Canadian warships last month.

"We hope to have the program on track relatively soon," said a senior defence official who spoke on background.

The first helicopter — known by tail number 001 — is expected to arrive at Shearwater, N.S., the air force's principal base on the East Coast, and will be used to train flight crews, said the official.

The aircraft-maker isn't expected to complete delivery of all aircraft until 2012 and the fleet won't be fully operational until 2013 [emphasis added].

National Defence is confident enough in the timetable that it has begun drawing up a schedule to retire its antique fleet of CH-124 Sea Kings, which have been in service since the early 1960s.

It became apparent last year that Sikorsky wasn't going to meet its contract deadlines for delivering the Cyclones [from January 2008: "The $1.85-billion deal announced with fanfare by the federal Liberals in 2004 required delivery of the first of 28 maritime helicopters by Nov. 30, 2008. That has been changed to Jan. 9, 2009..." Ha. Ha.]

During the intense negotiations that followed between the company, Public Works Canada and the Defence Department, it was suggested that taxpayers could end up forking out an additional $200 million beyond the already planned $5-billion budget.

Defence Minister Peter MacKay, as late as September, was expecting some form of additional cost to be tacked on to any potential agreement with Sikorsky.

In a statement late Tuesday, Public Works Canada confirmed a deal had been reached at a cost of $77 million for the helicopter purchase and $40 million for the 20 year in-service support contract.

But senior defence and military sources insisted that the extra cash will be made up from within the project's overall $5-billion initial price tag.

"It stays within budget," an official declared.

At one point during the talks, Sikorsky was told the federal government was prepared to impose late delivery penalties of $100,000 per day — to a maximum of $36 million — as provided in the original contract.

It's unclear if Ottawa followed through or whether the threat played a role in delivering the settlement. There was also speculation the Conservatives would simply cancel the deal...

The Cyclone's design was based on Sikorsky's already proven H-92 civilian helicopter, which is widely used in the offshore oil industry.

The recast, militarized version has the addition of a folding tail and rotors for storage aboard warships, anti-submarine warfare electronics, and a fly-by-wire system that allows the aircraft to be flown by computer.

"You have no idea how hard it has been" to re-engineer the aircraft, said a military official who has followed the program [then why the hell was the contract signed in the first place?].

The extra equipment has made the Cyclone heavier, forcing Sikorsky to upgrade the GE CT7-8A engines to a more powerful variant. That has taken time and money...

Canada, under the Liberals for political reasons (i.e. no more EH101s, not that that aircraft turned out that well, more here), bought a military version of a civilian helicopter that no other country has yet bought--and it's only just flown for the first time! Contract didn't work out too well, did it? So now we're eating the costs because there's nothing else to do. But don't forget the Conservative government has promised to improve defence procurement (from Update at link):

The Speech from the Throne also said this about defence procurement:

Fixing procurement will be a top priority. Simpler and streamlined processes will make it easier for businesses to provide products and services to the government and will deliver better results for Canadians. Military procurement in particular is critical: Canada cannot afford to have cumbersome processes delay the purchase and delivery of equipment needed by our men and women in uniform.

I answer: "Oink!" (with the CF now promoting rooting themselves). More on the Cyclone debacle here, where I wrote:

There should be a formal investigation, with the results made public, into how Sikorsky won the competition [lots of pork--"Benefits for all Canadians"]--and into the subsequent management of the project. I think it disgraceful that the Liberal government of Paul Martin, the CF, and Public Works chose in 2004 to buy a paper aircraft--that still has no other buyer, an aircraft that in reality simply could not meet the contract's terms without major changes to the original specifications of the machine...

And almost three years after the Conservatives took office we are still, supposedly, almost two years away from first delivery. Stinks.

Update: Another blogger puts out the government press release. Wow.

Upperdate: Latest on Cormorants from Aerospace Daily & Defense Report (h/t to Fred in "Comments"):

The availability of Canada’s CH-149 Cormorant search-and-rescue helicopters is improving after manufacturer AgustaWestland took action to improve spares provisioning, and inspection requirements were changed.

Earlier this year, an official report revealed availability of the 14 helicopters was less than 50 percent, well below the 75 percent expected when Canada purchased the EH101-based Cormorants in 1998.

The study said minimum operational requirements could only be met by buying more aircraft or reducing maintenance inspections. Canada purchased 15 Cormorants, but lost one, and the helicopters equip only three of the originally planned four operating bases.

The Department of National Defence (DND) denies Canadian media reports it is considering buying or leasing up to five more Cormorants [emphasis added], but says it is still evaluating the effectiveness of AgustaWestland’s recovery plan.

An operational availability improvement program instituted with Canada has made “genuine inroads” into overcoming the issues, says Jeremy Tracy, AgustaWestland’s head of region for Canada.

The program involves more attention to spares provisioning and the return of repaired and overhauled items, he says. Suppliers are being held to the provisioning times offered, and inspection intervals have also been adjusted to reduce maintenance downtime.

“As the aircraft matures we are able to reduce the maintenance burden,” Tracy says. Canada has now begun inspecting tail-rotor hubs for cracks every 200 flight hours, in common with other EH101 operators, instead of every 100 hours.

Working with the DND and maintenance prime contractor IMP, AgustaWestland has been able to get a better understanding of spares provisioning requirements, he says. “We have provided as many as we can against the target threshold.”..

Tracy says the program already has improved the availability of the Cormorants, citing recent statistics showing nine aircraft out of 14 available. This is an improvement over the 50 percent rate, but still short of the 75 percent target.

Availability varies day to day, the DND says, adding that “while the trend appears to be improving, the availability rate for the Cormorant has recently averaged six to seven aircraft available out of the total of 14 [That's bloody it! After over six years in service? - MC].”..

Remember also that our Cormorant is a unique, Canadian-specced, search and rescue version of the EH101 (now AW101) that no other country operates.