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Aerospace firms say Boeing may trump Bombardier for military deal

Feds deciding who to go with to replace aging military patrol planes
A Bombardier Challenger 650 aircraft cockpit is shown under construction at Bombardier’s Challenger manufacturing plant in Montreal, Wednesday, April 5, 2023. Canadian aerospace companies are pushing back against the notion that a Bombardier Inc. contract win to replace aging military patrol planes would be the most beneficial, stating that a deal between Ottawa and U.S. airplane giant Boeing Inc. could be at least as lucrative. THE CANADIAN PRESS/Graham Hughes

Canadian aerospace companies are pushing back against the idea that a Bombardier Inc. contract win to replace aging military patrol planes would be best for the sector, saying that a deal between Ottawa and front-runner Boeing Co. could be at least as lucrative.

Bombardier has been demanding the federal government allow for open competition on the successor to the Royal Canadian Air Force’s half-century-old fleet of CP-140 Aurora aircraft.

The Montreal-based business jet maker has argued that its reconnaissance planes will — once they start rolling off the line early next decade — offer a cheaper and more high-tech product that will be assembled in Canada — largely at a manufacturing centre on the edge of Toronto’s Pearson airport.

So far the government has not said whether it will go with a sole-source contract or an open bid. But its procurement department has stated that Boeing’s off-the-shelf P-8A Poseidon is “the only currently available aircraft that meets all of the CMMA (Canadian Multi-Mission Aircraft) operational requirements” — particularly around anti-submarine warfare and surveillance.

Martin Brassard, CEO of Quebec-based landing gear maker Héroux-Devtek Inc., points to Boeing’s massive production capacity, which would generate business for parts providers and maintenance and repair outfits across Canada. Eighty-one suppliers for the Poseidon are already based in this country.

“I’m not criticizing the Bombardier solution, because I don’t know the solution. One thing I know is they don’t have a solution ready. And this one (Boeing) is ready,” Brassard said in an interview.

He said a contract win could shore up Boeing’s 94-year-old presence in Canada — it directly employs some 1,800 workers and contracts roughly 500 suppliers north of the border — and open other doors at the company for Canadian operators.

Brassard also stressed the importance of a fast, reliable procurement process, pointing to past delays around military plane selection — for the CF-18 Hornet in the 1970s and more recently for the F-35 stealth fighter jet, whose competition process dragged on for more than seven years before being chosen in 2022.

“I don’t want that history to repeat itself with the CP-140, with all the political debates that now Bombardier is doing. It should not be a political decision; it should be a (Defence Department) decision.”

Ontario Premier Doug Ford and Quebec Premier François Legault this month echoed Bombardier’s calls for an open bid, renewing their demand from the summer to “level the playing field” with a request for proposals.

“They are confident of being able to develop the machine and then sell it outside Quebec, therefore creating jobs here,” Legault told reporters in French on Friday, when asked about Brassard’s comments.

Company spokesman Mark Masluch has warned of an “undue urgency” around securing a replacement for planes that don’t have a hard retirement date, calling it a “fallacy.” The 14 current aircraft are set to retire in 2030.

John Gradek, who teaches aviation management at McGill University, agreed that the Auroras are “not going to fall out of the sky,” but said time is a key consideration nonetheless.

“They’re going to start becoming very expensive to maintain, and sometimes even impossible to maintain because parts aren’t there anymore,” he said, noting that the Poseidons would be slated for delivery as early as 2026, roughly five years before Bombardier’s alternative.

“The question is, what shape is it going to be in and can it do the missions,” Gradek added. “Is it the technology we need?”

Earlier this year, Bombardier joined forces with U.S. rival General Dynamics to build a surveillance aircraft that would be a modified version of the Global 6500 jet, equipped with submarine-hunting technology and sensors from General Dynamics Mission Systems Canada — an Ottawa-based subsidiary of the Virginia defence contractor.

The plane would burn 30 per cent less fuel and fly “further, faster and higher” than its American counterpart, Bombardier Defense executive vice-president Jean-Christophe Gallagher claimed in May.

Bombardier has said a deal would add $2.8 billion to the country’s gross domestic product, citing a PwC report commissioned by the company. The potential multibillion-dollar contract would furnish 22,650 jobs directly — nearly 11,000 in Ontario, 6,550 in Quebec and close to 4,200-plus in Atlantic Canada — the report found.

A Boeing-commissioned study by Ottawa-based Doyletech found that a Boeing contract would generate nearly $10 billion in domestic economic activity over a decade and directly support more than 230 Canadian businesses.

The price of the 16 P-8A Poseidons and associated gear that Boeing aims to sell to Ottawa amounts to US$5.9 billion, according to a June 27 post from the U.S. Defense Security Cooperation Agency.

Tracy Medve, CEO of KF Aerospace, which does plane repair and overhaul in British Columbia and Ontario, has worked on Boeing’s Poseidon planes for decades.

“I believe personally it’s the right choice for Canada, because it’s a proven Boeing platform and because the P-8 has been in service in so many other areas,” she said.

The fact that Canadian allies operate the P-8A Poseidon could make it a smoother fit for the military as well as domestic suppliers already familiar with the product.

“Should your aircraft be down, you want to be able to go to your allies and say, ‘Hey, do you have that part?’ The airlines do it all the time,” said Lorenzo Marandola, president of Quebec-based M1 Composites Technology, which specializes in aircraft maintenance

“This is extremely important in terms of sustainment and in terms of mission operability.”

The other members of the Five Eyes Intelligence alliance — the United States, United Kingdom, Australia and New Zealand — as well as Germany, Norway and South Korea all fly the P-8, or plan to do so.

However, going with Bombardier could allow Canadian firms to carve a fresh technological path in aviation.

“You could potentially develop some Canadian-specific technology that Canada could own, control, potentially export internationally,” said Dave Perry, president of the Canadian Global Affairs Institute.

In recent years, Boeing has struggled with production and quality issues on its big-name commercial jetliners, particularly the 737 Max, 787 Dreamliner and 777. Questions linger over whether it could manufacture the Poseidons on time.

But Peter Wheatley, a vice-president at StandardAero, which maintains and repairs jet engines, called the risk “incredibly low.”

“The P-8 selection would be a phenomenal choice for the Canadian industry and businesses like mine,” he said.

StandardAero, founded in Winnipeg in 1937 with its other main facilities now in Prince Edward Island and Langley, B.C., would see up to $600 million flow into its coffers alone for a 10-year contract, Wheatley projected.

The company has already worked on 111 U.S. navy Poseidons as well as 15 Australian air force P-8s.

“We’d just love the chance to be able to do the Canadian ones as well.”