Shipbuilding contracts

[Smallc]

Can't be that bad...Zumwalts are north of $4 billion each because of cancelled orders.

Canada's warship yards aren't even ready to start a major building program...they need to finish upgrades after being idle so long.

This is going to be a long, expensive slog.

Irving is currently building the AOPS. Though not complex in a combat sense, it's the heaviest ship we've built. Edited December 6, 2015 by Smallc

[Smallc]

And unless I'm mistaken, the costs now being bandied about for the new frigates are greater than the cost of those big ass destroyers of yours or even those weird looking new Zumwalt things.

Not that I'm suggesting we buy either unless the government is willing to commit to the greater costs of manning and operating something that big. Which they won't.

It's a bit misleading. The costs are coming from a few places. Australia is building 3 ships that are basically exactly what we want to built for the first 3 Canadian Surface Combatants. They're almost $9B for those 3 ships. These area air defence destroyers are very expensive and complex. The other 12 ships are not as expensive.

[Derek 2.0]

It's a bit misleading. The costs are coming from a few places. Australia is building 3 ships that are basically exactly what we want to built for the first 3 Canadian Surface Combatants. They're almost $9B for those 3 ships. These area air defence destroyers are very expensive and complex. The other 12 ships are not as expensive.

And your statement is further misleading, as the extensive cost overruns with the Hobart program are directly attributed to the shipyard (that to save money, hired new tradesmen apprentices, resulting in over 90% of the workforce never having built anything) and Navantia (the Spanish company that designed the vessels) refusing to join the build consortium out of fear of losing its profit share........

In essence, you had the ships designer hand over the blue prints, walk away and leave the vessels construction up to kids out of high school........what could go wrong?

The cost of the systems to go into the ships remained the same (like the current projected costs in our program), but labor and project management costs exploded.........like what Irving is saying what will happen (doubling the cost) with them before the final design has even been selected........it would be akin to hiring a plumber to redo your bathroom, and after reaching a rough estimate, the plumber returns and says the price doubled because he doesn't have the experience to do the job.

[Smallc]

It's a crappy situation, definitely. I'm simply thinking that we would have to expect similar costs.

[bush_cheney2004]

It's a crappy situation, definitely. I'm simply thinking that we would have to expect similar costs.

You can't start and stop major shipbuilding programs for decades and expect to pick up right where you left off. Ain't no free lunch.

[Smallc]

You can't start and stop major shipbuilding programs for decades and expect to pick up right where you left off. Ain't no free lunch.

Which is exactly why I expect similar costs. That said, I'm hoping that with the AOPS coming first, some of that can be avoided.

[bush_cheney2004]

Which is exactly why I expect similar costs. That said, I'm hoping that with the AOPS coming first, some of that can be avoided.

What about the personnel shortage issue...I assume that withered like the ships. How will Canada crew these new ships ?

[Derek 2.0]

What about the personnel shortage issue...I assume that withered like the ships. How will Canada crew these new ships ?

The early (forced) retirements of the destroyers (and AORs) addressed many of said issues in the interim......but like any Western Force, technical trades will always be in increasing demand......oddly enough, a surplus of young Canadians with educational backgrounds in poetry, history and women's studies etc won't address this............hence the drive (by all navies) to reduce crew sizes and increase living standards aboard ship and at home (in hope of increasing retention rates).

[Smallc]

What about the personnel shortage issue...I assume that withered like the ships. How will Canada crew these new ships ?

That's a good question. I expect most will require fewer crew.

[Argus]

That's a good question. I expect most will require fewer crew.

That's good. They'll likely have fewer people available for crew with the Liberals' 'leaner' new military.

Up until recent years, our Navy had 15 heavy warships — 12 frigates and 3 destroyers. In theory, the government was planning to replace those ships on a one-to-one basis, with 15 new, Canadian-built vessels. Delays and cost overruns now threaten to force cuts to that total, and that will be bad, since 15 ships is really about the right number for either the Atlantic or Pacific Coasts, not both.

http://news.nationalpost.com/full-comment/matt-gurney-what-does-a-leaner-military-mean-exactly

[Smallc]

That's good. They'll likely have fewer people available for crew with the Liberals' 'leaner' new military.

That's not a certainty given the same exact funding levels as the Conservatives promised.

Besides, the article is not well fact checked:

We no longer have any supply ships to sustain them on their missions, anyway, and the Liberals recently deferred a key decision on a proposal to replace them with converted civilian vessels, on an interim basis, until replacements arrive sometime next decade.

That was true....8 days ago.

Edited December 7, 2015 by Smallc

[Derek 2.0]

Thought, as a contrast, today's DoD spending Bill should be included..........noting said DoD figures are in USD and not CDN:

The bill contains $18.7 billion for Navy shipbuilding programs, an increase of $2.1 billion and one ship from the president's request. In total, it proposes the construction of 11 new warships: two Virginia-class submarines, two DDG-51 destroyers, three littoral combat ships, 28 amphibious transport dock, one Joint High Speed Vessel, one Afloat Forward Staging Base ship and one T-AO Fleet Replenishment Oiler. The bill also provides incremental funding, as authorized in the National Defense Authorization Act, for one Arleigh Burke-class destroyer in addition to the 10 DDG-51s in the fiscal 2013-2017 multiyear procurement contract.

With today's exchange rates, that would translate into ~$25 billion Canadian, or about what was budgeted for the RCN's warship replacements.......digging further, the DDG 51 destroyer multiyear contract for ten of the most modern destroyers currently in service:

General Dynamics Bath Iron Works (BIW) is being awarded a $2,843,385,450 fixed-price incentive firm target (FPIF) contract for the design and construction of four DDG 51 class ships, one in FY 2013 and one each in FY 2015-2017. This award also includes a contract option for a fifth ship.

Huntington Ingalls Industries (HII) is being awarded a $3,331,476,001 fixed-price-incentive firm target (FPIF) contract for the design and construction of five DDG 51 class ships, one each in FY 2013-2017.

These multiyear procurement awards are for a total of nine ships, with an option for a tenth ship. The Navy's objective is to procure the tenth ship as part of the planned FY 2013-2017 MYP. The Navy will work with Congress to resolve funding shortfalls resulting from sequestration reductions before contracting for the 10th ship.

or ~$6.1 billion USD (~$8.4 billion CDN) for 9+1 AEGIS destroyers.....if one was to double the contract size to account for additional vessels required by the RCN (15 total), and more than addressing inflation since 2012, that would still be under ~$20 billion CDN, or ~$7-8 billion less than the previous Government budgeted for the frigate replacement.........and then, granting the remaining ~$7-8 billion going towards new training establishments on both coasts, additional munitions, alterations to the vessels hangers etc.........

Irving doesn't have a leg to stand on suggesting they need double the money to fulfill the RCN's requirements (American yards are not cheap, nor that efficient contrasted with overseas yards), nor does the Trudeau Government have a justification to meet the RCN's requirements with the previous estimated funding requirements......the RCN's destroyer/frigate replacements will come down to political will.

[Smallc]

With today's exchange rates, that would translate into ~$25 billion Canadian, or about what was budgeted for the RCN's warship replacements

There is only $14B budgeted for the acquisition portion of the contract.

[Smallc]

I'll also again point you to the Australian example, where their project ended up costing ~$8B. We have a dollar almost the exact same strength, though our industry, with 4 - 5 AOPSs under their belt when they start, will actually be in a better place.

[bush_cheney2004]

Irving doesn't have a leg to stand on suggesting they need double the money to fulfill the RCN's requirements (American yards are not cheap, nor that efficient contrasted with overseas yards), nor does the Trudeau Government have a justification to meet the RCN's requirements with the previous estimated funding requirements......the RCN's destroyer/frigate replacements will come down to political will.

Point noted, but is probably moot because the American yards would not increase capacity for such shaky Canadian contracts anyway. Having spent a few years at Newport News for multiyear submarine overhauls and new construction, continuous production is critical to hitting cost and schedule targets.

[Derek 2.0]

There is only $14B budgeted for the acquisition portion of the contract.

No, $14 billion for the design and build of the vessels........Irving doesn't build radars, munitions, electronics etc.....

[Derek 2.0]

I'll also again point you to the Australian example, where their project ended up costing ~$8B. We have a dollar almost the exact same strength, though our industry, with 4 - 5 AOPSs under their belt when they start, will actually be in a better place.

As I already noted in this thread, the Australian example was one not to replicate.

[Smallc]

No, $14 billion for the design and build of the vessels........Irving doesn't build radars, munitions, electronics etc.....

The project budget was set years ago at $26.2 billion. Of that, $14 billion was to be spent on the design and construction of warships.

The rest of the budget is for the provision for ammunition, infrastructure costs such as jetties, spare equipment and support.

http://www.cbc.ca/news/politics/nsps-naval-ship-procurement-costs-1.3345435

[Derek 2.0]

Point noted, but is probably moot because the American yards would not increase capacity for such shaky Canadian contracts anyway. Having spent a few years at Newport News for multiyear submarine overhauls and new construction, continuous production is critical to hitting cost and schedule targets.

That's just it, there is a constant drumbeat of production......to capacity, with a hypothetical Canadian order, it wouldn't need to be increased, just not slowed, as has been done in the sequestration environment.........and cash upfront

[Derek 2.0]

The project budget was set years ago at $26.2 billion. Of that, $14 billion was to be spent on the design and construction of warships.

The rest of the budget is for the provision for ammunition, infrastructure costs such as jetties, spare equipment and support.

http://www.cbc.ca/news/politics/nsps-naval-ship-procurement-costs-1.3345435

I know, and the (and integration of) purchase of radars, sonars, ECM, engines etc.......which aren't produced by Irving

[Smallc]

I know, and the (and integration of) purchase of radars, sonars, ECM, engines etc

Show me. The link doesn't say what you want it to.

Edited December 17, 2015 by Smallc

[bush_cheney2004]

That's just it, there is a constant drumbeat of production......to capacity, with a hypothetical Canadian order, it wouldn't need to be increased, just not slowed, as has been done in the sequestration environment.........and cash upfront

That's the opportunity, but also the big challenge given Canada's procurement history.

Canada likes HUGE cancellation fees instead of finishing the job.

[Smallc]

Irving doesn't have a leg to stand on suggesting they need double the money to fulfill the RCN's requirements

Yes, it's a good thing the government is hiring an expert.

[Derek 2.0]

Show me. The link doesn't say what you want it to.

No, it doesn't, but then its the CBC.....it also doesn't breakdown the cost of the systems integration.............Irving doesn't build engines, radars, missiles, training simulators etc,

[Derek 2.0]

Yes, it's a good thing the government is hiring an expert.

Is said "expert" well versed in magic?