Bidding partner says fighter jets could bring hundreds of jobs to Atlantic region

Click to play video: 'Contract to replace Canada’s fighter jet fleet could bring big benefits to Maritimes'
Contract to replace Canada’s fighter jet fleet could bring big benefits to Maritimes
Two companies are in the running provide Canada with its next fleet of fighter jets, replacing the aging CF-18s. The federal government has not confirmed Boeing isn’t one of them, leaving American-based Lockheed Martin and Swedish-based Saab in contention. It’s a $19-billion contract that could bring big benefits to the Maritimes. Callum Smith reports. – Dec 2, 2021

The $19-billion contract to replace Canada’s CF-18s is down to two official bidders, and a spokesperson partnered with one of those companies says hundreds of jobs could come to the Atlantic region if they’re selected.

“We’re talking about 600 [jobs] in the Atlantic region and about 6,000 spread out, over the life of the contract, across Canada,” says Mike Michaud, IMP Aerospace’s chief operating officer.

“The plan is to build them right here in Halifax.”

IMP Group is a partner with Saab, a Swedish-based company, which is one of two remaining proponents for the job to build 88 fighter jets. Lockheed Martin is the other company vying for the bid.

No one from Lockheed Martin was available for an interview Thursday, but in a statement to Global News, a spokesperson says “approximately 150,000 jobs will be supported in Canada through the selection of the F-35,” according to an economic impact study.

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The official announcement from Public Services and Procurement Canada comes nearly a week after The Canadian Press first reported that Boeing had been told its bid for the $19-billion fighter jet contract did not meet Canada’s requirements.

The government refused to comment publicly at that time, including on whether the U.S. aerospace giant was out of the competition.

But the department in a statement on Wednesday confirmed Lockheed Martin’s F-35 stealth fighter and the Swedish Saab Gripen are the only two fighters still in contention.

The statement did not say why Boeing’s offer did not make the cut.

Jeff Collins, an associate professor at UPEI and a defence procurement expert, says Lockheed Martin could have the edge.

“We don’t do things independently, we work in alliances. And our number one ally is the United States and we’ve been buying American jet fighters since the late 50’s, early 1960s,” he says. “So to go with a non-American front-line fighter jet would be a huge rupture and break from past precedent.”

Bidders had been required to show their fighter jet was able to meet the military’s requirements for missions at home and abroad, and that winning the contract would result in substantial economic benefits to Canada.

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News that one of the two U.S. companies competing for the contract failed to meet one or more of the requirements is the latest twist in what has already been a long and often unpredictable road toward replacing Canada’s CF-18s.

Click to play video: 'Canada weighs the pros and cons of acquiring new fighter jets'
Canada weighs the pros and cons of acquiring new fighter jets

While Public Services and Procurement Canada says it will finalize the next steps in the competition in the coming weeks, it insists it is still hoping to award a contract in time for the first new fighter jet to arrive by 2025.

Many observers had seen the Super Hornet and F-35 as the only real competition because of Canada’s close relationship with the United States, which includes using fighter jets together to defend North American aerospace on a daily basis.

There have been long-standing concerns in some corners that the entire competition has been set up from the beginning to select the F-35, which is being purchased by many of Canada’s closest allies.

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Canada first joined the U.S. and other allies as a partner in developing the F-35 in 1997 and has since paid US$613 million to stay at the table. Partners get a discount when purchasing the jets and compete for billions of dollars in contracts associated with building and maintaining them.

Stephen Harper’s Conservative government then committed to buying 65 F-35s without a competition in 2010, before concerns about the stealth fighter’s cost and capabilities forced it back to the drawing board.

The Liberals promised in 2015 not to buy the F-35, but to instead launch an open competition to replace the CF-18s. They later planned to buy 18 Super Hornets without a competition as an “interim” measure to ensure Canada had enough aircraft until permanent replacements could be purchased.

Collins, the UPEI professor, says “controversy has been dogging the replacement project for the CF-18s since 2010.”

“In this case, we’ve seen one and two governments now, treat it as a political football,” he says. “The consequence is that the [Royal Canadian Air Force] keeps using older and older aircraft. It’s having pilot retention issues; we paid over $1 billion to buy used Australian F-18s to help augment our own fleet.”
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Some at the time questioned that plan, suggesting the Liberals were trying to find a way to lock Canada into the Super Hornet without opening itself up to a legal challenge from Lockheed Martin or any other jet makers.

But the government cancelled the plan after Boeing launched a trade dispute with Montreal aerospace firm Bombardier over the latter’s C-Series planes. It later introduced a penalty on firms seeking a federal contract who have launched a trade dispute with Canada.

Meanwhile, the government has been forced to invest hundreds of millions of additional dollars into the CF-18 fleet to keep it flying until a replacement can be delivered. The government has said it plans to name a winner in the coming months, with the first plane delivered in 2025.

The last plane isn’t scheduled to arrive until 2032, at which point the CF-18s will have been around for 50 years.

— with files from The Canadian Press

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