LM says Canada could lose billions if they don't select F-35

While opening an engine overhaul facility in Montreal, Orlando Carvalho, executive vice president for aeronautics at Lockheed Martin told onlookers that Canada stands to lose as much as $11B in contracts over the next 25+ years if the government chooses not to purchase the F-35.

He said that Lockheed will honor the $488M in contracts they have with Canadian companies, but in the future will try to work with countries that have purchased the aircraft.

Canada was poised to order 65 F-35s as replacements for their F-18 Hornet aircraft, when they reversed their decision after pressure over costs.

The U.S. company that makes the controversial F-35 fighter is publicly warning that Canadian industry stands to lose as much as $10.5-billion in spinoff contracts if the federal government ends up not buying the warplane.

Orlando Carvalho, executive vice-president of aeronautics at Lockheed Martin, delivered this cautionary message in Montreal on Friday. He said Canadian companies can keep the roughly $500-million in fighter-related contracts they have, but no more F-35 work would be likely for this country if Ottawa does not embrace the Lockheed plane.

“If, in fact, the Canadian government were to decide not to select the F-35, we will certainly honour the contracts that we have here with the Canadian industry, but our approach in the future would be to try to do business with the industries that are in the countries that are buying the airplane,” Mr. Carvalho said while opening an engine overhaul facility in Montreal.

www.theglobeandmail.com...

Very wise of them, the F-35 is on track to become arguably the worst fighter of it's generation. Likely to result in the USA for the first time in a very long time, losing its technological advantage over everybody else.

Ah, blackmail. That's bizniz. The fact that they are overdoing expenditures that translates to tax payer dollars doesn't come into play? Screw em. Canadians typically want to have an infusion into our military. Not bankroll an American company like the American tax payers do. Secondly, we don't want a fighter that will be partially obsolete when it finally becomes operational.

im glad that we are not going ahead with this fiasco..if lm wants to blackmail..pffft so what, they will cancel 10 billion, we will save..hmm not sure what the last cost estimate was(they havent been able to nail that down).. i think around 25-30 billion..seems like a get out of jail free card

reply to post by vonclod


As the later LRIPs are entering production costs are dropping, quite a bit. It's expected that by LRIP 7 or 8 the F-35A (which is the one Canada would choose) would be under $100M an aircraft. It's dropping between 4-8% a run. So if Canada does go ahead with it, you will see costs drop quite a bit from what they originally were.

you know what Canada really needs to do is to re-establish real a aviation industry of our own. something that was destroyed by the scrapping of the arrow. thanks to positions bowing and scraping to the US government and aviation industry. who knows what awesome aircraft have been lost due to that travesty. lets not bow down to them over this over rated piece of crap yet again.

reply to post by Zaphod58

ahh ok..we havent heard much about it as of late, when it was being discussed in the house we were hearing about figures fron say 15 bill to upwards of 30+ bill..i think though the costs projections include maintenance and so on(all costs) for the next 20yrs..or whatever they projected the service life to be.
i think though the jet was said to not be suitable in arctic conditions so if thats true the f35 is not in our best interest

Anyway, Canada's got every expertise and resources to make our own jets.

Now that's a great way to save money, at least the people making profit would generally spend it inside the country which is a win-win situation.

reply to post by theMediator

we have done it before but i think in the end the general public is not going to be wanting to foot the bill for r&d which is a huge cost and i doubt private money will be enough

reply to post by vonclod


Yeah, that would be total cost of ordering, through the end of service at the time they placed the order.

As for the arctic conditions, they're still testing a lot of things. The big problem they have is the lack of a low observable SATCOM system in the initial production runs. You could theoretically put a regular SATCOM system on board, but that would defeat the purpose of low observable.

But I agree, and I don't think the F-35 is best for Canada. It's hard to say what is, but I don't think the F-18 is either. I'd like to see Canada with something like the F-15SE, or SA. Something with real legs behind it, that doesn't require tanker support every time it takes off.

reply to post by Zaphod58

the f18s have served well but are getting old..thanx for the info.

reply to post by vonclod


The F-18 when it comes to range, sucks. Pilots can't stand the range factor in every version of it. The new "Advanced Super Hornet" has two conformal fuel tanks, and new engines added, and it's just as bad. With two JSOWs, and two air-to-air missiles, it has an 800 nm range. And the conformal fuel tanks reduce the already bad transonic acceleration.

Pilots love what they can do with them, they're great in a WVR fight when they're clean, or lightly loaded. But to get any kind of legs on them they have to carry three external fuel tanks, and have access to a tanker on the way in, and on the way out or they can't make it.

reply to post by Zaphod58


That's the unique problem that Canada has. It's a HUGE landmass and the north is only going to get busier. Maybe we need more bases.

reply to post by Zaphod58


Heres an idea...

how about we don't buy fighter jets we don't need and build a few oil processing plants...

That way we don't have to give our oil to the americans only for them to sell it back to us...

bloody sakes

reply to post by intrepid


That's what I think should also happen. Add a few more northern bases, and you can extend the legs of the Hornet fleet if you want to go that way. Or if you go with something like the F-15SE, with that combat radius, you could own the Arctic skies easily without tanker support at all.

reply to post by Zaphod58


It only makes sense imo. Build infrastructure. Gives you latitude and stimulates the local economy. That's why it won't happen. Our gov't =

reply to post by intrepid


I know the feeling. I've been watching my beloved Air Force fall apart over the last few years, and nothing get done about it because 1) it would make sense, and 2) because it would mean fewer of their shiny new stealth fighters.

intrepid
Ah, blackmail. That's bizniz. The fact that they are overdoing expenditures that translates to tax payer dollars doesn't come into play? Screw em. Canadians typically want to have an infusion into our military. Not bankroll an American company like the American tax payers do. Secondly, we don't want a fighter that will be partially obsolete when it finally becomes operational.

So what are you going to do? Buy Super Hornets, which are, in pretty much every way inferior, except in schedule and cost (and probably have less industrial offsets)? And then raise the F-35 cost for everyone else?

C0bzz
So what are you going to do? Buy Super Hornets, which are, in pretty much every way inferior, except in schedule and cost ?

In all, likelihood, yes. Schedule and Cost are the only units of measurement our government understands at this point. Truthfully, our gov't simply does not understand what it is the RCAF needs. Until they do, no purchases should be made anyway.

(and probably have less industrial offsets)

LM already has contracts with Canadian companies to do work on the F-35 to the tune of 500 million dollars. If we truly are going to lose billions as LM claims, then we need to see up front what they are offering us in offsets prior to signing anything. If they do so, then this estimate is unnecessary because it will be included in the bid. If they do not, then acting on the assumption that LM has hoards of money tucked away in their bid for us to discover would only add to the boondoggle of opacity and horrible estimates that we have called our procurement process.

And then raise the F-35 cost for everyone else?

We won't feel guilty, if that's what you mean. If the jet is worth its cost, people will pay for it.