Tuesday, March 15, 2011

Con MP On F-35: "It's Not A Firm, Fixed Price"

An interesting exchange yesterday on the CBC, Conservative MP Hawn on air to defend the F-35 plane, responding to the ballooning costs. When asked if they are any guarantees, the price tag the government is banking on realistic, Hawn offered the following:
Barton: LET ME ASK YOU, THOUGH AS YOU KNOW, THE F35s HAS BEEN A BIG ISSUE IN THE U.S. AS WELL. PEOPLE ARE TRACKING IT VERY CLOSELY. DO YOU HAVE -- DOES THE GOVERNMENT HAVE A DOCUMENT, ANY SORT OF WRITTEN GUARANTEE FROM THE U.S. GOVERNMENT OR FROM LOCKHEED MARTIN THAT SAYS VERY CLEARLY THAT CANADA WILL BE PAYING NO MORE THAN 70 TO 75 MILLION PER PLANE? IS THERE A PRICE TAG ATTACHED TO IT AND DO YOU HAVE IT WRITTEN DOWN SOMEWHERE SO YOU WON'T GET CAUGHT LATER ON?

Hawn: NO. ROSEMARY, IT'S NOT A FIRM, FIXED PRICE. BUT EVERYTHING THAT WE HAVE LOOKED AT AND THE DEFENCE SECRETARY IN THE U.S. THE OTHER DAY, LAST WEEK, SAID THAT OUR AIRPLANE, THE F35(A), IS IN GOOD SHAPE...

Hawn goes on to tell us that the costs are in line, maybe even better! And yet, when asked the most basic of questions on cost, his response is the price is entirely up in the air, there is really no basis for their figures, apart for dated sales job figures from the vendor. In other words, confirmation that the Conservative figures that they cite really have no real world resonance, they are arbitrary numbers, outdated(when were their figures first quoted, just how old are they?), nothing concrete to counter the numbers the international conclusion the PBO was part of.

In addition, this now recurring argument (might be paraphrasing here):
"F-35 is the only plane that meets the requirements"

We keep hearing this argument, which begs the question- if this plane meets our requirements, why oh why does this government REFUSE to release the Statement of Requirements for this plane? I won't rehash previous posts, but we have a situation wherein this government can't confirm the costs, admit the price can change, plus their argument on fitness is handicapped by their own inability to produce KNOWN verification? How anyone can be comfortable with almost surreal scenario escapes me.

Next time a Conservative challenges the critic costs, cites their own costs, just remember they haven't done their own math, the ADMIT their analysis isn't "firm" or "fixed" and their justification for the plane is being withheld, despite normal protocols. A recipe for voter confidence if I've ever heard one. Screaming BOONDOGGLE, high pitched shrieking!

23 comments:

LTD.Edition said...

Some things I have to mention.

The price to purchase IS firm. The price to maintain (which is where the larger portion of the price comes in) could change, depending on the circumstances. Who knows what'll happen in the field.

I do think we're spending too much though...how about BUYING LESS? And using our current CF-18's to supplement them when we aren't up against a modernized foe?

As for the requirements. I can answer that, since there won't ever really be a list. They need to be able to win a dogfight (and survive) and strike ground targets (and survive). Pretty simple.

To do that against any developed nation or modernized nation we need stealth. Our fighters don't have this. The F-22 does... but it's US exclusive. That's why NATO is developing the F-35 for alliance countries (it lost to the f-22 in 1-on-1 combat trials... in groups it does better because of it's unique targeting system).

We also need a fighter that can take off and land on shorter runways (that way we can use aircraft carries that our allies may have and also possibly our own ships or anywhere that fits since they have vertical take-off).

The only other option is a chinese model that is still in testing... Russia does have some 5th generation fighters (Mig-35, Su-27) but neither have stealth capabilities.

The only other option would be to go to another 4th generation fighter... which, doesn't make sense, since we already have the CF-18's.

There you have it. You should read about the targeting system on the F-35. It's quite amazing actually. But I do agree that we are spending too much on these, I believe Israel was given a number of F-35's for significantly less than our purchasing cost. I do think, as I said earlier, that we should perhaps purchase fewer of them for the time being. Afterall, I don't see us going to war with a developed nation anytime soon.

Kirk said...

The price to purchase hasn't even been agreed upon yet. Hahn admitted that clearly in the interview so what is this firm price?

Also, prices of purchases do actually increase after the contract is signed. The recent purchase price, not just maintenance costs, of helicopters for the Canadian military has increased after we committed to buying them.

see http://www.torontosun.com/news/canada/2010/10/26/15835631.html

Fat Arse said...

And to top it all off - the entire operational fleet of F-35's in the US has been grounded over the most basic "requirement" SAFETY! See: http://arsenisms.blogspot.com/2011/03/yet-another-reason-why-harper.html

LTD.Edition said...

I do see what you two are saying.

In regards to purchasing price, I was unaware the price of a contract could change after it's been agreed to (that's some poor negotiating there).

On the issue of troubles with the "entire f-35 fleet" I didn't know about issues but did read the article that was linked on the blog mentioned... it stated that the issue was found during a test flight. The US doesn't have any f-35's in use yet, the issue was with a test fighter of which they have 3 or so models built. Large scale production (by military jet terms) isn't scheduled to begin until after these types of issues are resolved... so to say the "entire fleet" (what fleet?) is unreliable and unsafe (it's still in testing) is a bit of an overstatement. This is why there is testing afterall.

I just don't see any other options. I'd love to hear them. So far I haven't had anyone offer a realistic approach to this other than my suggestion of buying fewer fighters in the mid-term.

Fat Arse said...

@ LTD.Edition - re: "I didn't know about issues but did read the article that was linked on the blog mentioned... " Had you indeed read the article in question you would have read the VERY FIRST line from the Rueters article that read --- "The military has grounded its entire fleet of 10 F-35 fighter jets built by Lockheed Martin Corp..." Further, the article references 13 planes, not a mere 3 as you assert. Certainly, 13 airplanes DO constitute a fleet. But I guess there's no point letting facts get in the way?

Fat Arse said...

Oops my bad, in the interst of being true to the facts, the cited number of 13 jets should have read 10... but 10 is still a fleet.

LTD.Edition said...

I never said there were only 3 planes. 3 Models of plane (maybe I read that wrong, I'm not talking numbers, just variants). The 13 fighters are still all test fighters though. So maybe, grounded the entire fleet of test fighters would be more accurate and less slanted?

They won't be in operational use until 2016 in the USA and at that point they'll have over 2,000 as per their deal with the manufacturer.

My only point is that the "unreliablity" that caused an "entire fleet" to be grounded is rather misleading.

One would expect issues with a test anything. That's why it's being tested. And then to say entire fleet infers they are in operational use and now off the table leaving some kind of defensive gap. Simply put, I'd hope to see a less emotional and slanted view and a more accurate and reasonable view presented.

And again, does anyone have any suggestions as what else we could do?

Our fighters are getting old and have been in service since 1983.

Fat Arse said...

@LTD.Edition - AND as if that isn't enough to give you pause, Bloomberg is reporting this VERY HOUR that: "Lockheed Martin Corp. (LMT)’s development of software for its F-35 fighter jet, the Pentagon’s largest weapons program, is “significantly behind schedule as it enters its most challenging phase,” according to congressional auditors." You know what that means don't you? Price increases across the board for all purchasers!

LTD.Edition said...

yea I went on your 13 as well. Anyways, they're still test fighters and since they are finding the issues now I'm much happier than if they found them after they went into service.

That said, would you buy a car that wasn't tested? And if during the testing phase it had a part malfunction and then a have a design fix implemented to resolve the issue would you then say it's not safe and not buy one?

I don't see articles about other aircraft models having issues during test flights being equal to them not being safe or being unreliable. Otherwise we would be seeing articles abotu the new airbuses having problems before they were ever put into use or plethera of cars out there.

Normally we only hear or complain about performance and safety issues on final products. This isn't a final product yet... why are we complaining about it's safety if they're still working on improving it?

Tof KW said...

I just don't see any other options. I'd love to hear them. So far I haven't had anyone offer a realistic approach to this other than my suggestion of buying fewer fighters in the mid-term.

How about buying generation-4.5 Super Hornets from Boeing? They are even offering forward stealth now, but I don't see the need myself (unless we intend to use them on offensive strike missions a lot) and stealth technology is what makes these damned things expensive. Also stealth is the only real difference difference between generation-4.5 and 5.0. Super Hornets also make perfect sense considering we've been flying CF-18s for the past quarter century now, we know the planes well and they are very trustworthy. Also the F-18E/F has proven combat experience, and are duel-engine planes.

Or, if we want to be different, we can always begin talks with the EuroFighter consortium.

A Eliz. said...

F-18 Hornet..easier to maintain, and cheaper to buy.

LTD.Edition said...

Just another reason to buy less of them then. And I ask again... what other options do we have that you could suggest?

My only one is to not buy as many since they'll be useful to have.

(I'm not sure, maybe you know how many we are getting, but I think it's around 60 or so... why not get half the number?)

Fat Arse said...

@LTD.Edition,

Look I have no desire to be unreasonable or shrill about this boondoggle but the fact is, according to Bloomberg:

“After more than nine years in development,” including four years of overlapping low-rate production, “the program has not fully demonstrated the aircraft design is stable, manufacturing processes are mature and the system is reliable,” said GAO."

This is enough to make me say this deal is wrong for Canada... as to "What is to be Done?" -- well Lockheed Martin is not the only jet fighter manufacturer in the world, so I say we walk away and look for a better deal, with better costs, for a stripped down fighter that meets our TRUE national "requirements".

Fat Arse said...

I too prefer the Hornets option, a reasonable price, buttressed by proven technology sounds good to me.

LTD.Edition said...

The super hornet doesn't have thrust vectoring (something vital in air-to-air combat). If we ever face off with another modernized military that has thrust vectoring flight we'd be pretty screwed.

Offensively we haven't used fighters since Kosovo but stealth is valuable for defensive air-to-air as we have a fairly small airforce.

I don't see that being a real use though, more realistically they would be used to protect the opening arctic passage as well as missions similar to what we did in Kosovo.

More F-18s as one suggested is basically going to be getting the super-hornets (just another f-18 model)... I still say maintain what we have and have 1 wing of these f-35s for when we need to do stealth strikes or multi-fighter defense.

Steve V said...

Let's not forget as well, the Chinese are working on a plane that is superior to the F-35, so if your argument is we need the best, well it will be outdated by the time we fly by appearances.

Fat

These quotes are out today?

WhigWag said...

LTD.Edition seems to be talking out of his hat:

there are 3 very different (and w. very few interchangeable parts, as it turned out, contrary to the original 'economy of scale' rationale) versions, and the cheapest, 'A' version we're getting is CONVENTIONAL take-off and landing, and WOULD NOT be able to safely take off or land from an aircraft carrier: that's the 'C' version.

And the 'B' version, the Harrier-ish, Jump Jet, VERY short take off type, has been so buggy its likely to be cancelled altogether.

Fat Arse said...

@ Steve,

Yes those are direct quotes from Bloomberg out today courtesy of my Gmail "news alert" function1 I fear the news regarding the manufacturing scenario (i.e. progress) and cost F-35 will even be darker once the full US government report that Bloomberg references comes out at month's end.

LTD.Edition said...

Well damn, no VTOL for our model? That takes away the option of piggy backing on carriers.

As one here suggested we could go with the Chinese option (if they would be willing to sell them to us)... I think it's not going to be in operation for a while though isn't it? Something like 2025?

We do need some sort of solution for saving money. The fact is that while there are many who are against this there are also many for it so we can come to the conclusion that we ought to do SOMETHING in terms of upgrading and switching to other fighters with similar capabilities doesn't make much sense...

At the end of the day I don't think any of us can really make a good call on this. We don't have the full extent of the situation before us. Our military needs and what the pilots are saying and the various costs from other countries if we went with their options (can't see into he future). It's a tough call.

LTD.Edition said...

Superhornet I'd agree with if it had thrust vectoring... apparently there is a model of f-15 and f-16 that do.

Kirk said...

Another part of this interview contains another lie by Hawn.

At the 50:45 mark of P&P he claims "In 1980 we paid 16 million and change for the F18. If we roll that ahead to 2016 we'd be paying 63 million dollars for every F18 that we now own. So from 63 to 75 is not a huge leap...".

Well, is this an honest attempt to put all prices in current dollars? No.

If you go to:

http://www.bankofcanada.ca/en/rates/inflation_calc.html

You'll find an inflation calculator.

Hawn is claiming that prices will rise by about 400% from 1980 to 2016. From 1980 to today prices have risen 282% ie. 2.82 times. We'll need over 7% a year inflation over the next 5 years to get to 4 times.

At a closer to reality inflation rate of 2.5% a year, in 2016 dollars the F18 would cost $51 million each which by the way slightly less than the F18 Super Hornet's book price of $55 million.

That makes the comparative price difference $24 million per plane (1980 F18 vs. 2016 F35) in constant dollars.

I guess he sees a lot of inflation coming our way in the next five years. And of course even though this $63 million dollar number for F18s in 2016 is a big fat lie he's left himself one point to cover his lie. No one knows what inflation will be over the next five years, though he seems it will be enormous.

Steve V said...

Great catch Kirk!

WhigWag said...

So, more grist for the PBO report mill -- no surprise, here, since the no's probably come from the same GAO source he used (the US Gen. Accntng Off., like our AG), but this article from the Atlantic cites the US's projected costs for it's whole fleet of 2,443, for $382-B for acquisition, and $650-B for maintenance, which works out to $422.4-M each... or $27.5-B for 65! (which, um, is pretty close to the PBO's $29.5, and I imagine the US would get them a bit cheaper, no?).

So, they're not using "real" numbers, either, Laurie?

http://www.theatlantic.com/national/archive/2011/03/the-f-35-a-weapon-that-costs-more-than-australia/72454/