Shipbuilding contracts

[waldo]

Hey now, said article referenced Nova Scotia’s contribution to the F-35.…

I responded to your direct quote that reflected upon a Northrup contract... not LockMart.

I’m sure this topic thread could use further distractions, misconstrued quotes and fancy indents…………Give her a go………

again, I simply responded to your direct quote which was a straight-across-the-bow shot reference to "other LockMart costing decreasing over time". But... yet again... I note you won't commit to a F-35 per-plane estimated acquisition number!!! Is there a problem?

carry on!

[Guest Derek L]

I responded to your direct quote that reflected upon a Northrup contract... not LockMart.

A Northrop subcontract for a Lockheed program…..

again, I simply responded to your direct quote which was a straight-across-the-bow shot reference to "other LockMart costing decreasing over time". But... yet again... I note you won't commit to a F-35 per-plane estimated acquisition number!!! Is there a problem?

But I already did Waldo..........Including through life costs

[waldo]

no - no you didn't. I have no hesitation in quoting exactly what was written... where you avoided a direct request and chose, instead, to bury that cost figure. Now... you can't even state the number... now you're dancing between the 92 million figure in that, as you say, "linked DND table" (which, of course, originates from the "independent" LockMart) - and I'm the only one to have pulled that number out of the table and stated it... you won't even acknowledge it. Or... as you say, "Government's estimates"! Which "Government estimates"... the $65 million a plane, the $70 million a plane, or the $75 million a plane number? Which is it? $65 million? $70 million? $75 million? $92 million? Like I said, there's a long, long way to come down from the current LRIP numbers... a long way to even settle in at that $120 million a plane figure being bandied about as the absolute minimum any U.S. military branch or JSFail member country can expect to pay. A... long... way! What's your number again?

But... yet again... I note you won't commit to a F-35 per-plane estimated acquisition number!!! Is there a problem?

But I already did Waldo..........Including through life costs

again, yes, I most certainly recall you giving that full all-encompassing cost (inclusive of life-cycle)... where you've buried the per-plane acquisition cost. I don't ever recall you responding to my repeated direct requests asking you to separately provide your perceived number for an isolated, per-plane, fly-away acquisition cost. You refuse to provide that number. Either come out and say you're simply not prepared to offer that number (and state why), or provide the number... just provide the number. Which is it? $65 million? $70 million? $75 million? $92 million? Or what?

[Guest Derek L]

again, yes, I most certainly recall you giving that full all-encompassing cost (inclusive of life-cycle)... where you've buried the per-plane acquisition cost. I don't ever recall you responding to my repeated direct requests asking you to separately provide your perceived number for an isolated, per-plane, fly-away acquisition cost. You refuse to provide that number. Either come out and say you're simply not prepared to offer that number (and state why), or provide the number... just provide the number. Which is it? $65 million? $70 million? $75 million? $92 million? Or what?

http://www.forces.gc.ca/site/reports-rapports/ngfc-cng/index-eng.asp#6

As per the above mentioned DND flyaway cost of ~92 million per aircraft

[waldo]

As per the above mentioned DND flyaway cost of ~92 million per aircraft

excellent... why was that so hard for you to finally state? Should I dredge up those past posts that had you adamant the initial HarperConservative low-balled numbers were "spot on"? You do realize that DND number is based on "independent" LockMart data/input, right?

and, like I've stated a few times now, there's a long, long, long way to come down from the current LRIP number to reach even that unrealistic ~$92 million per plane number. You certainly won't reach it even accepting to the claim from LockMart representatives that they still believe a 40% reduction in the LRIP costs can still be met!

[Guest Derek L]

excellent... why was that so hard for you to finally state? Should I dredge up those past posts that had you adamant the initial HarperConservative low-balled numbers were "spot on"? You do realize that DND number is based on "independent" LockMart data/input, right?

and, like I've stated a few times now, there's a long, long, long way to come down from the current LRIP number to reach even that unrealistic ~$92 million per plane number. You certainly won't reach it even accepting to the claim from LockMart representatives that they still believe a 40% reduction in the LRIP costs can still be met!

It’s context……..Said “lowball figures” are inline with the actual purchase price of the aircraft sans engines etc………….And no, no reluctance, as I’ve said, I’ve provided said costing in numerous threads……..I just to don't feel required to respond to you on command.

Now care to reciprocate and give the flyaway cost of your championed Super-Hornets or yet unnamed “drones”? Perhaps in the F-35 thread to save smallc from whinging?

[waldo]

Its context..Said lowball figures are inline with the actual purchase price of the aircraft sans engines etc.And no, no reluctance, as Ive said, Ive provided said costing in numerous threads..I just to don't feel required to respond to you on command.

without engines now!!! Certainly, I've snarked about the numerous estimates out there... some with engines, some without. As I'm aware, I don't recall HarperConservatives ever reaching for that go-to in attempting to rationalize their low-ball numbers. But wait, what's this:

Sure, the early prototypes are hideously costly more than $150 million a copy, but Canada won't be buying until 2016, when production is at full speed, says O'Bryan, so the cost of each jet will fall.

By then, he says, "average unit price of the airplane would be $65 million." Is that with an engine? "Yes, sir."

Now care to reciprocate and give the flyaway cost of your championed Super-Hornets or yet unnamed drones? Perhaps in the F-35 thread to save smallc from whinging?

perhaps I'll remind you again. My so-called championing, as you say, was simply me responding to you... yes you... bringing forward and linking to an article on Australia purchasing the Super-Hornet (after giving up on the F-35's lengthy delay and exorbitant costs). As for Super-Hornet costs, I did identify the latest costs per the latest USN purchase... I'm surprised you don't recall this since at the same time you pressed me for full support/life-cycle costing.

but yes, if you which to continue, you know where the current F-35 thread is, right?

[Guest Derek L]

Might have to speed up the surface combatant replacement process:

http://www.cbc.ca/news/canada/british-columbia/story/2013/04/23/bc-navy-esquimalt-ship-collision.html

On Tuesday, navy officials refused to comment on what might have occurred, saying only that the investigation is ongoing.

And the video:

And one of the only released pics of the Winterpeg:

Though it doesn’t look too bad on the surface, the HMCS Winnipeg just finished her FELEX refit that was to help keep her relevant until retirement, but the rumour mill is swirling with word of far more extensive damage to her starboard side (from hitting the jetty) and possible shock damage to the ship’s more delicate internal systems.

Perhaps interesting to the tin hat wearing constituency, the tugs towing the American factory ship were owned by SEASPAN, part of the Washington Marine Group, the very company that just refitted Winnipeg (across the harbour at Vic Ship, where the above video was likely taken) and will be the benefactor of the smaller portion of the Shipbuilding program contracts……

Funny enough, the NDP “defence” critic is already criticising the MND & DND over their apparent lack of harbour security:

http://www.timescolonist.com/security-questions-raised-as-trawler-and-warship-are-pulled-apart-after-collision-1.118031

NDP defence critic Jack Harris said the collision does raise security concerns.

“I guess a lot of people are wondering out loud how one of our warships could be damaged in such a manner in Esquimalt Harbour,” Harris said.

He called pictures of the incident “pretty stark and shocking.”

Harris said the harbour is busy and further safety measures could be a point of discussion.

“I would wonder what other special precautions may need to be taken,” he said. “We’re assuming this was an accident, obviously, but it certainly shows that this kind of thing can happen.”

First I wonder if the critic has ever been to CFB Esquimalt, and second, what “special precautions” could the RCN have taken to “defend against” a massive factory ship that obviously broke free from her two tugs in the middle of the harbour?

Drug and alcohol testing for the tugs union crew?

Edited April 25, 2013 by Derek L

[Guest Derek L]

Now I might be going senile, but I seem to recollect a poster, perhaps in this thread even, having associated doubts with the final number of hulls that would end up in the water………Who could that be

http://www.cbc.ca/news/politics/story/2013/05/02/pol-milewski-shipbuilding-design-mystery.html

A CBC News investigation has uncovered a $250-million mystery at the heart of Canada's ambitious shipbuilding program.

Public Works Minister Rona Ambrose and Defence Minister Peter MacKay announced March 7 in Halifax that Ottawa will pay Irving Shipbuilding $288 million just to design — not build — a fleet of new Arctic offshore patrol ships.

Irving will then build the ships under a separate contract.

However, a survey of similar patrol ships bought by other countries shows they paid a fraction of that $288 million to actually build the ships — and paid less than a tenth as much for the design.

In addition, the design of Canada's new ships is based upon a Norwegian vessel whose design Ottawa has already bought for just $5 million.

The Norwegian ship, the Svalbard, was designed and built for less than $100 million in 2002.

So why isn’t this a major issue with the NDP and Liberals, no calls for a “do over” of the shipbuilding program, better yet, why don’t we just outsource the construction of our new Naval vessels to foreign yards?

Another link to a segment from Power and Politics:

http://www.cbc.ca/player/Shows/ID/2382955925/

Edited May 3, 2013 by Derek L

[scribblet]

I admit I'm not up on this, but In its ad, Irving called the story “inaccurate and inflammatory,” and alleges that CBC “made absolutely no effort” to contact Irving before they broadcast the story – and that Irving only heard form the CBC afterward.

I wonder if how accurate all of these articles really are, how much do they get wrong, or how much information do they withhold.

http://www.ipolitics.ca/2013/05/06/irving-hits-back-over-cbc-arctic-patrol-ship-story/

[Guest Derek L]

I admit I'm not up on this, but In its ad, Irving called the story “inaccurate and inflammatory,” and alleges that CBC “made absolutely no effort” to contact Irving before they broadcast the story – and that Irving only heard form the CBC afterward.

I wonder if how accurate all of these articles really are, how much do they get wrong, or how much information do they withhold.

http://www.ipolitics.ca/2013/05/06/irving-hits-back-over-cbc-arctic-patrol-ship-story/

Certainly, it’s prudent, like the F-35 “debate”, to dig deeper into said discussions, fore those in media are quick to print incorrect information……With that said, the irony I find funny is that the Opposition in Parliament doesn’t have the same “fire” as they do with the F-35, when this is a much more expensive program.

No political hay to be had over defence programs with ties to their backyards I suppose…….Exemplifying my stance that politics needs to be taken out of defence procurement in Canada.

[carepov]

http://www.cbc.ca/news/politics/story/2013/05/02/pol-milewski-shipbuilding-design-mystery.html

So why isn’t this a major issue with the NDP and Liberals, no calls for a “do over” of the shipbuilding program, better yet, why don’t we just outsource the construction of our new Naval vessels to foreign yards?

Another link to a segment from Power and Politics:

http://www.cbc.ca/player/Shows/ID/2382955925/

Wow I am baffled by how the design of a ship can cost $250,000,000 plus tax when similar ships are designed and built for $100,000,000. What do you think about this Derek?

I also do not know why the opposition has not asked more about this.

[Guest Derek L]

Wow I am baffled by how the design of a ship can cost $250,000,000 plus tax when similar ships are designed and built for $100,000,000. What do you think about this Derek?

I also do not know why the opposition has not asked more about this.

I have no doubt in my mind that it would cost more to build a ship in Canada then the other European countries mentioned in the story…….They have ongoing experience in shipbuilding, heavily subsidized yards and workforces (That could be another factor in the price discrepancy, in that some costs are accounted for differently in the European figures) and a willingness to farm out labour intensive portions of the builds to Eastern European countries.

Now I won’t drink (fully) the CBC’s Kool-Aid with regards to the actual numbers reported fore and against, since as been proven time and time again, those doing the reporting know little of the subject mater in which they’re reporting, and often skew or unintentionally screw-up the “facts”…..

I will say this though, as I’ve alluded to in the first couple of pages back in 2011, once the same accounting methods are applied to the shipbuilding program as was done with the F-35 (Operating costs, training, maintenance etc) and projected over the life of the ships (35-45ish years) the total costs will be in the 100s of billions. For example, for our military to operate a fighter force, both CF-188 and the eventual F-35, cost ~1-1.5 billion a year, or ~5% of our currently allocated Defence budget. Once we examine the operating costs associated with nearly the entire Navy, I would estimate (and being on the low side) that will eat somewhere between 20-30% of our Defence budget (and quite possibly higher)…….Just a fingers and toes estimate would see ~4-6 billion a year, over say 35 years plus the ~35 billon associated with purchasing the ships, for a total somewhere in the ~$175-250 billion range over a 35 year lifespan………Like I said earlier, the Liberals and NDP have yet to make any real political hay over this……..

[carepov]

I have no doubt in my mind that it would cost more to build a ship in Canada then the other European countries mentioned in the story…….They have ongoing experience in shipbuilding, heavily subsidized yards and workforces (That could be another factor in the price discrepancy, in that some costs are accounted for differently in the European figures) and a willingness to farm out labour intensive portions of the builds to Eastern European countries.

Now I won’t drink (fully) the CBC’s Kool-Aid with regards to the actual numbers reported fore and against, since as been proven time and time again, those doing the reporting know little of the subject mater in which they’re reporting, and often skew or unintentionally screw-up the “facts”…..

I will say this though, as I’ve alluded to in the first couple of pages back in 2011, once the same accounting methods are applied to the shipbuilding program as was done with the F-35 (Operating costs, training, maintenance etc) and projected over the life of the ships (35-45ish years) the total costs will be in the 100s of billions. For example, for our military to operate a fighter force, both CF-188 and the eventual F-35, cost ~1-1.5 billion a year, or ~5% of our currently allocated Defence budget. Once we examine the operating costs associated with nearly the entire Navy, I would estimate (and being on the low side) that will eat somewhere between 20-30% of our Defence budget (and quite possibly higher)…….Just a fingers and toes estimate would see ~4-6 billion a year, over say 35 years plus the ~35 billon associated with purchasing the ships, for a total somewhere in the ~$175-250 billion range over a 35 year lifespan………Like I said earlier, the Liberals and NDP have yet to make any real political hay over this……..

I agree we don't have an apples to apples comparison, but Canada's ships are costing 250 million for DESIGN ONLY - comparable ships are 100 million TOTAL price (including the design). What am I missing here?

Do you think that our shipbuilding program is a wise allocation of our resources?

[Guest Derek L]

I agree we don't have an apples to apples comparison, but Canada's ships are costing 250 million for DESIGN ONLY - comparable ships are 100 million TOTAL price (including the design). What am I missing here?

Do you think that our shipbuilding program is a wise allocation of our resources?

As I said, I don’t put much stock in the actual numbers presented by CBC, but I tend to agree with the intent of the CBC article.

As to allocation of resources, I agree with the intent (renewal of the Navy) but not necessarily with the methods of procurement, well understanding said political realities associated with said methods……

For instance, the Australians will procure three Hobart class Destroyers, (built in Australia) for ~$8 billion, but were offered the same number of (more capable) Arleigh Burke Destroyers by the Americans for ~$1-1.5 billion a pop……….To me, such a stark difference in price doesn’t seem viable, as such, if DND has to purchase price inflated Canadian ships for the sake of regional development, the additional cost should be borne by another Federal Government department’s budget and/or the Province.

[Hudson Jones]

So it's all good? The Conservatives have done nothing wrong and they have not mismanaged this whole thing? Kind of like the F35's?

[Guest Derek L]

An update on the Shipbuilding program:

http://www.forces.gc.ca/site/news-nouvelles/news-nouvelles-eng.asp?id=4822

Two viable ship design options were commissioned for the Joint Support Ships: an existing design and a new design by BMT Fleet Technology. Based on rigorous analysis and assessments by government officials and military experts, the proven, off-the-shelf ship design from ThyssenKrupp Marine Systems Canada was selected as the best design option for the Royal Canadian Navy and for Canadian taxpayers.

Canadian version of the German Berlin Class:

[carepov]

An update on the Shipbuilding program:

http://www.forces.gc.ca/site/news-nouvelles/news-nouvelles-eng.asp?id=4822

Thank you for the update.

Does anyone have answers to the following:

a) how much was spend so far on the procurement process (selection of the design, etc..)?

b.) what are the projected final costs of these ships?

The last info I got (2010) was that 2 ships would cost a total $2.6 billion. Is it just me being a cheapass-taxpayer or does this seem like a lot of money?

Edited June 17, 2013 by carepov

[Guest Derek L]

Thank you for the update.

Does anyone have answers to the following:

a) how much was spend so far on the procurement process (selection of the design, etc..)?

b.) what are the projected final costs of these ships?

The last info I got (2010) was that 2 ships would cost a total $2.6 billion. Is it just me being a cheapass-taxpayer or does this seem like a lot of money?

Here you go:

http://www.tpsgc-pwgsc.gc.ca/app-acq/sam-mps/dinsi-bkjss-eng.html

• The total cost estimate for the acquisition of two ships is $2.6 billion.

• The estimated cost of 30 years of in-service support is approximately $1.9 billion for two ships. This estimate is subject to refinement once the JSSequipment selections are finalized and ISS contract development and negotiations are conducted.

• The estimated costs associated with 30 years of Personnel and Operating are approximately $2.6 billion. This is based on current DND estimating methodology and a notional operational profile and target crew sizes.

For a total of $7.1 Billion..........And yes, it is expensive when you factor in the entire life cycle costs for two ships…….With that said, the support and operating costs would remain relatively constant regardless of what type of vessels we selected, but the $2.6 Billion acquisition cost could have been reduced if we purchased the ships from the German builders…..Of course German shipyard workers don’t pay Canadian taxes…..

[carepov]

Here you go:

http://www.tpsgc-pwgsc.gc.ca/app-acq/sam-mps/dinsi-bkjss-eng.html

For a total of $7.1 Billion..........And yes, it is expensive when you factor in the entire life cycle costs for two ships…….With that said, the support and operating costs would remain relatively constant regardless of what type of vessels we selected, but the $2.6 Billion acquisition cost could have been reduced if we purchased the ships from the German builders…..Of course German shipyard workers don’t pay Canadian taxes…..

Thanks. $1.3 to purchase a boat seems expensive. I wonder why building in Canada costs more compared to Germany?

Also, my perception is that these projects are almost always way over-budget, do you agree?

[Guest Derek L]

Thanks. $1.3 to purchase a boat seems expensive. I wonder why building in Canada costs more compared to Germany?

The Germans (like many other European shipbuilders) has had a near constant, sustained drumbeat of production, plus they make use of cheap Eastern European yards for much of the initial fabrication, coupled with cheaper Eastern European labour garnered through the various European Union worker mobility programs…..

Also, my perception is that these projects are almost always way over-budget, do you agree?

It already is.. Initially the Navy wanted four ships, the government changed that to three, then two with an option on the third, and now two………Overall, just from Washington Marine Groups naval maintenance tract record, I’d expect that the actual build shouldn’t be too bad, but the Irving portion of the combatant build…..I dunno.

Edited June 19, 2013 by Derek L

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[Guest Derek L]

It already is.. Initially the Navy wanted four ships, the government changed that to three, then two with an option on the third, and now two………Overall, just from Washington Marine Groups naval maintenance tract record, I’d expect that the actual build shouldn’t be too bad, but the Irving portion of the combatant build…..I dunno.

With the recent hubbub over the backlog of space to build the Navies two new AORs and the CCG's new icebreaker, with the selection of the AORs to come first, a solution might have appeared. Now an organized procurement system would be looking for available stop-gaps………Well the Dutch just put their brand spanking new AOR/LSD, the Karel Doorman (that is still fitting out) on the military-industrial complex’s version of Craiglist:

http://www.trouw.nl/tr/nl/4492/Nederland/article/detail/3503355/2013/09/04/Defensie-verkoopt-schip-voor-het-af-is.dhtml

They built her for about ~$500 million........Of course, that price would be a bargain and allow us to give one of our current shipyards work, alongside as opposed to on the new slips they're building, well also allowing us to use our current AORs less until the new ones are built....And once built, we could keep her as a "spare" AOR and use her for disaster relief and other humanitarian missions......

Of course, that would only make sense.

Edited October 18, 2013 by Derek L

[Guest Derek L]

Had this paper emailed to me by a friend from the US Naval War Collage:

http://www.usnwc.edu/getattachment/8c48e9ba-b7ca-42f1-868b-451f9ac72cd0/The-Type-45-Daring-Class-Destroyer--How-Project-Ma.aspx

A cautionary tale on modern warship development, and lessons that the Canadian Government, RCN and our shipbuilders should heed, with this paper centred around the Royal Navy’s Type 45 Daring class Destroyer.

Some of the criticisms of the Type 45 won’t be shared, like the Block Building of the ships, since the Government rightly separated the different ship types and gave them as a whole to separate builders, as the British issue associated with the MoD not having a close relationship and oversight won’t befall our program.

Where I do find potential for trouble is that the Government has appeared to have fixed the price for each ship prior to having a mature design, as opposed to a more traditional method of building the first vessel “cost plus” and identifying areas of savings for the follow on ships of the class. In essence, setting a fixed price, prior to a mature design will only lead to cost increases and in turn, less ships for the same amount of money……..Case in point, the reduction in numbers from 4 to 2 AOR…..or the promise to build “6-8” AOPS…….

Clearly if from the onset there is a need for 4 AORs and 8 AOPS, we should build 4 AORs and 8 AOPS. This does not mean we should give the builders a “blank cheque”, but have realistic expectations that difficulties and design changes will occur, as such (and within reason) we should be prepared to “work out the bugs” with the lead ship in each class.

Another critique of the Type 45 is the ambivalence towards developmental costs associated with modern technology…….The Type 45 is a State of the Art warship, but many of the technological hurdles associated with it, also had to be developed for it, with the tab being picked up by the British and to lesser degrees the French and the Italians….Though this same trap may not befell us, so far the AOR and AOPS are to be based on largely already mature designs, built around already mature technology, we will have to tread carefully once we start the surface combatant phase of the program.

[Guest Derek L]

An update on the Shipbuilding program:

http://www.forces.gc.ca/site/news-nouvelles/news-nouvelles-eng.asp?id=4822

Canadian version of the German Berlin Class:

Well no longer a Canadian version of the Berlin class, but per the media, the Queenston class:

http://blogs.ottawacitizen.com/2013/10/25/joint-support-ships-to-be-named-hmcs-queenston-and-hmcs-chateauguay/

NIAGARA-ON-THE-LAKE, ONTARIO–(Marketwired – Oct. 25, 2013) – The Honourable Rob Nicholson, P.C., Q.C., M.P. for Niagara Falls, Minister of National Defence, today announced the names of the Royal Canadian Navy’s (RCN) new Joint Support Ships (JSS), which will be built by Vancouver Shipyards Co. Ltd. in North Vancouver, B.C. The two Joint Support Ships (JSS) will be named Her Majesty’s Canadian Ship (HMCS) Queenston and HMCS Chateauguay in recognition of the significant battles of Queenston Heights and Chateauguay during the War of 1812.

Could make for some historic whimsy if either HMCS Queenston or HMCS Chateauguay are commissioned in time to conduct an UNREP of USS Lake Erie, USS Lake Champlain, USS Boxer and USS Fort McHenry….. Oh say can you see it.....