Bombardier Crying Foul

[Iknowbest]

Sob sob sob poor Bombardier is crying their eyes out because a Canadian Company in Kelowna BC is GETTING a huge $1billion plus contract from the Feds.

Man oh man this is unheard of. Every two years Bombardier in Quebec receives anywhere from $1.2 -$1.6 Billion of our tax dollars to remain in business and if we are lucky the government may get back $175-200 million of it in taxes but say bye bye to the Billions that company received mostly for nothing.

It isn't vote buying is it? It isn't corruption is it ? It isn't screw you Canada is it? If it isn't those things then what is it for?

Gee what could it be? Oh got it it is because the Liberals are super duper managers of the public purse and tell nothing but the truth so help them Rene Levesque!!

[PocketRocket]

I have mixed feelings about Bomardier. On the one hand, it's nice to have at least one major-league company in Canada who builds and markets big-ticket items like airliners.

On the other hand, it would be nice if they could manage their resources to the point where we only have to bail them out once every couple of years, instead of pouring money into them on what seems like a daily basis.

I think they've gotten spoiled, like an only child with doting parents. Now, when someone else gets a bit of attention, they throw a tantrum.

[Bakunin]

bombardier isnt the only company getting money from the government. Count in alberta oil and ontarian car industry.

[kimmy]

For those not sure what this is in reference to (and I was among them until doing some looking) here's some of the story.

The Canadian government is poised to award a billion-dollar contract to the embattled Bombardier Inc. or to a British Columbia-based consortium in a hotly contested program to provide military pilots with training for the next 20 years.

(...)

Aerospace industry executives expect the winner to be announced by the end of January. Defence officials will only say the contract is to be awarded some time early in the new year.

But that announcement could give Prime Minister Paul Martin's government a major political headache. Pressure is intensifying from Quebec Liberals for federal help in bailing out the financially ailing Bombardier. But Mr. Martin is also trying to make inroads with Western voters and passing over a major B.C. aviation firm in favour of the Quebec-based aerospace giant could hurt his party at the polls.

A team made up federal bureaucrats will determine the winner, but that selection will be reviewed by cabinet because of the value of the contract.

(...)

"Even if Bombardier is clearly the winner in this program, the optics will look bad," said Mr. Shadwick, a strategic studies professor at York University. "It will be perceived as a gift to Bombardier. It will be a Bristol-type of thing all over again."

(...)

The issue of Western Canadian aerospace firms being snubbed by the federal government was an issue this summer after the awarding of a $5-billion contract for new Canadian Forces maritime helicopters to a U.S. firm. Western Canadian companies will only be in line to receive $390 million worth of work from that project. The lion's share of the helicopter program work -- $2 billion -- will go to Ontario firms. Another $2 billion is being divided up between Quebec and Atlantic Canada companies.

(The complete article was posted in a thread at another forum. Is linking to other forums allowed? Can be viewed here:

http://forums.army.ca/forums/index.php/top...ic,23986.0.html )

Norman Spector's blog posted additional information, also from Pugliese, which explains the "Bombardier crying foul" part of IKB's post:

“Bombardier Inc. is on the verge of losing a billion-dollar-plus Defence department contract because the federal government dislikes the aerospace giant and is giving an unfair advantage to its competition in Western Canada, says one of the firm's vice-presidents.

Bombardier alleges federal officials changed procurement rules in a program to provide military pilots with flight training, in order to aid a competitor. The situation is a major reversal of roles for the Quebec-based firm, often accused in the past by its competition of relying on political connections to win government deals.

Documents leaked to the Citizen show Bombardier made an appeal Feb. 14 to Treasury Board President Reg Alcock to cancel the competition and restart the process. The government has refused. Bombardier has been running the flight training program at Portage La Prairie, Man. for the last 12 years, but that contract expires in the summer.

The Ottawa Citizen has gone to a subscriber pay articles, so I can not provide direct links to the articles, and nobody other than Pugliese appears to be covering this.

-kimmy

[PocketRocket]

bombardier isnt the only company getting money from the government. Count in alberta oil and ontarian car industry.

I understand that other companies get federal funding.

Oil is a resource. We are definitely on the map already as a resource-exporting country.

Cars made in Ontario are not seen as Canadian cars. We simply provide manufacturing sites for foreign companies.

What I meant was simply that Bombardier is a Canadian-owned, Canadian-based company making something with a high-prestige profile.

It was not meant as a slight to other businesses.

[Guest eureka]

Do we want an aerospace industry or not. Bombardier gets no more than its very few rivals do from their governments.

Britain had an aerospace industry that was light years ahead of the Americans and it lost it to the kind of crying that goes on about Bombardier.

A whole lot more Canadian industry is dependent on Bombardier, too.

[kimmy]

Do we want an aerospace industry or not. Bombardier gets no more than its very few rivals do from their governments.

Indeed. Brazil's Embraer, in particular, gets a great deal of subsidy. What solution there might be to this dilemna is unclear.

However, I don't see that this has much bearing on this current discussion, where the question appears to be as to whether Bombardier's government connections are strong enough squish competitors within Canada.

Britain had an aerospace industry that was light years ahead of the Americans

(During what era was this?)

and it lost it to the kind of crying that goes on about Bombardier.

Has it been lost? A few minutes of checking indicated to me that Britain's aviation industry, all the companies from the Goode Olde Dayes of British aviation, were not disbanded but just consolidated. Companies such as Bristol, Vickers, and the aircraft division of English Electric merged in 1960 to form the British Aircraft Corporation. Hawker and DeHavilland and Armstrong-Siddeley Engines formed the Hawker-Siddeley Group, which existed until 1977, when it merged with BAC to form British Aerospace, which is still around as a successful entity in military and civilian aviation, as is Westland Helicopters.

I have done some reading in regards to the aerospace industry in the post-war era in relation to the demise of the Avro Arrow and the development of supersonic flight during these years. It is my observation that a shift in military thinking during this time contributed greatly to changes within the aerospace industry, and the hardships that caused the mergers in British aerospace are just a reflection of the same trend that saw the cancellation of the Arrow and of several major US aerospace contracts in the late 1950s.

A whole lot more Canadian industry is dependent on Bombardier, too.

Bombardier is large. I'm sure that their presense has many spin-off benefits in the places where they operate. However, as with any expenditure of government money, I feel that it is important to ask whether the benefits merits are proportional to the expense.

-kimmy

[Guest eureka]

Britain's significant presence in the Aerospace industry now is through a European consortium. All those others are pale imitations of the giants they were.

The great days were those when such visionary concepts as the Concorde and the Brabazon were on the boards.

It is a hard choice, but it may be that Canada must choose between "squishing" upstart competitors and losing Bombardier and our entry into the big leagues.

[kimmy]

Britain's significant presence in the Aerospace industry now is through a European consortium. All those others are pale imitations of the giants they were.

The great days were those when such visionary concepts as the Concorde and the Brabazon were on the boards.

I had to look up the Brabazon. It's interesting that you cite it as a "visionary concept" or an example of British aviation being "lightyears ahead of the Americans," when its commercial failure appears to have been because it was rather the opposite. At a time when the deHavilland Comet was already in service and the Boeing 707 was just a couple of years from revolutionizing air travel, "visionary" appears to be the last word one would use to describe the Brabazon.

As for the Concorde, it was not technologically "light years ahead" of American capabilities. In fact the Concorde is a smaller, much slower version of the Valkyrie bomber which the US was already flight-testing at the time the Concorde was first proposed.

Philosophically, the "visionary concepts" behind the Concorde were also behind their American counterparts: the Boeing 2707 program was cancelled due to environmental concerns and economic infeasibility back in 1971; Concorde was ultimately done in by the same issues 32 years later after a grand total production of just 14 aircraft in commercial service.

It is a hard choice, but it may be that Canada must choose between "squishing" upstart competitors and losing Bombardier and our entry into the big leagues.

One wonders if similar rationales were offered in an effort to justify the CF18 contract...

-kimmy

[waynej625]

Who cares waht Barzil gives to their aerospace industry, because I am sick to death of both the Quebec government and Quebec companies whining and crying while they stick out their hands for their share and everyone else's of the Canadian financial pie. Evry time we turn on the radio or TV we find out that the federal government has given yet more of our hard earned tax dollars to this whining bunch of baby's. I can't wait for them to hold another referrendum, only this time I am hoping they vote to separate. Don't let the door hit you on the way out. As long as they keep threatening to separate, our feds ahould be showing them an axample of what life will be like after separation, by first closing military facilities in Quebec and moving federal infrastructure to other Provinces. The feds should do that anyway, until such time that the Quebec people elect to office, MP's who consider themselves to be Canadian, because the Bloc insists on referring to Quebec as a country instead of a Province within Canada.

What we need is a federal government to grow some balls, and tell our whining cousin's in Quebec that they have gotten all they are going to get, and that they are entitled to only what the rest of the Provinces are entitled to an nothing more. They should not get even that until they repeal Bill 101.

Bombardier seems to only want to be Canadian when it is time to hold out their hand for more federal cash. Much of their manufacturing is done overseas, and not in Canada at all, so tell me again why they should be entitled to my tax money.

[seabee]

How can Québec consider itself a “distinct” nation? It’s not because it has a different language, a different history and culture, even different religious beliefs, its Code civil, its own tax collection, its own health system and blood agency, its own police, its different education system, its retirement plan and car insurance, its cinema, television, literature, theater, its own popular music industry, that it is “distinct”. On everything else, it is no different from the ROC, except of course for its Bloc Québécois, a different text of the federal “national” anthem, not a translation, its universal child care program. But on everything else...

[Guest eureka]

Qeubec does not have a different language. It has two languages that it shares with Canada. For reasons that I have gone into countless times, it is being allowed to eliminate one of them. One day, that will blow up.

Most of the other things are what every other province also has.

[Guest eureka]

Kimmy, if you have watched the recent programs on the Concorde you shoud have a different conclusion. America was a long way from developing anything close and it refused to buy the Concorde in order to kill it. The excuses about noise etc were just excuses.

The Brabazon was many years ahead of Boeing. I recall estimates of a decade or more for America to develop anything competitive. Britain also had top secret warplanes at the time that were unmatched. Coming out of the war, Britain was unrivalled in aviation technology.

[waynej625]

How can Québec consider itself a “distinct” nation? It’s not because it has a different language, a different history and culture, even different religious beliefs, its Code civil, its own tax collection, its own health system and blood agency, its own police, its different education system, its retirement plan and car insurance, its cinema, television, literature, theater, its own popular music industry, that it is “distinct”.

And how did it acquire all of these things, except of course it's Civil Code? It got them because weak federal politician's allowed them to institute them, and even gave them money from the ROC to accomplish it. I say it is time to stop giving in to Quebec's whining, and start saying "No!" or at the very least stop making special deals with them that do not apply right across this land of OURS, not Quebec's, but your's, mine, and every other Canadian who pays taxes in this country. We should all be treated exactly the same with Canadian tax money, I could care less that they would like to ally themselves with Europe, let them. Europe has done nothing for us, nor will they.

Many on this thread do not like the heavy handedness of the US, but the same type of situation is happening in the European Union. The difference between North America and Europe, is that we have a dominant United States, who calls the shots. Europe has Germany, and to a lesser extent, the wanabe ruler's, France, calling the shots. We would be treated with much less respect over there. If it wasn't for North America, and Brittain, Europe would now be ruled by Germany. In fact in some respects they have cupitulated their sovereignty to Germany by joining the European Union. After two failed attempts at force, Germany has finally concurred Europe, and this time they didn't even have to fire a shot. They let corporate money do it for them.

[caesar]

This is a federal contract; not a hand out. It is about time BC got a few federal contracts.

As for the federal government subsidizing some industries; it paid out quite a bit to the beef industry; the fishing industry is subsidized and the fisherment get to work part time and collect EI. Another form of subsidy. Sometimes it is necessary to prop up industries rather than have large segments of the population unemployed and getting handouts.

Other industries are subsidized that need to spend large sums of R&D; Canada needs to have companies that can produce high tech equipment and other industries including pharmaceuticals.

[kimmy]

Kimmy, if you have watched the recent programs on the Concorde you shoud have a different conclusion. America was a long way from developing anything close and it refused to buy the Concorde in order to kill it. The excuses about noise etc were just excuses.

The Brabazon was many years ahead of Boeing. I recall estimates of a decade or more for America to develop anything competitive. Britain also had top secret warplanes at the time that were unmatched. Coming out of the war, Britain was unrivalled in aviation technology.

I did not watch any of the programs regarding the Concorde.

However, it's a documented fact that the North American Aviation company was flying Valkyrie prototypes in 1963, when the Concorde was still just a proposal. The Valkyrie really *was* techonologically lightyears ahead of anything else at the time. The Valkyrie was larger- 93 metric tons vs 79 metric tons empty, with a maximum take-off weight almost 60 metric tons heavier than the Concorde (243t vs 185t). Longer range- the Valkyrie was capable of 7900km, vs 7200km for the Concorde. Speed? The Concorde was capable of Mach 2.04 full throttle, the Valkyrie was proven capable of cruising at over Mach 3. The Valkyrie project also pioneered construction techniques for building high-temperature components that were used in (guess what) the Concorde, among others.

To suggest that the Concorde was beyond the reach of American technology of the time is simply absurd. The proof has been standing in a hanger at the Wright-Patterson Air Force Museum since before the Concorde even made its first test flight.

You can read about the magnificent Valkyrie here:

http://en.wikipedia.org/wiki/XB-70_Valkyrie

...or here:

http://www.labiker.org/xb70.html

It is likewise absurd to suggest that "the Americans" killed the Concorde by refusing to buy it. The Americans killed their own SST project, the Boeing 2707 (which was being designed, like the Valkyrie, to meet far higher performance specifications than the Concorde) by pulling government funding from the research and development, under pressure from the environmental lobby.

"The Americans" did not refuse to buy the Concorde to kill it. "The Americans" did not buy the Concorde because the government of the United States does not, generally speaking, buy civilian jetliners in any significant number. Airline companies make their own decisions as to which airplanes they wish to purchase. And purchasing a jet which is unacceptable for use over populated areas, and gets ridiculously horrid fuel economy, is poor business planning. An American company did, in fact, attempt to operate a couple of leased Concordes between Dallas and Washington, and found the enterprise simply wasn't economically viable. As I expect British Airways and Air France decided themselves was true for the whole Concorde experiment, which despite its name prestige and marketing cachet, was of very limited commercial value in any case.

As for the Brabazon, it appears to have been a case of the classic quotation "The aim was right, but the target moved."

-kimmy

[Guest eureka]

The Valkyrie was a failure. It is that simple. The Americans did refuse to buy the Concorde - that after placing tentative orders.

One "reason" given for reneging was the "noise" factor. It took a few years before it was given clearance to fly into New York - and a change in government.

The Brabazon situation was about the same as "The Arrow."

Thre was no substantial Europen market in those days and the development of the industry was dependent on the American market with its oligopoly.

[The Terrible Sweal]

So guess what. Bombardier has, all this while, as they collected government loans and guarantees to fund an ocean of debt, been PAYING DIVIDEND. I.e. Bombardier has been funnelling tax money into shareholder pockets.

Personlly I find that outrageous. No company should be crying poor and getting relief while they're shovelling the money out the back door.

[kimmy]

The Valkyrie was a failure. It is that simple. The Americans did refuse to buy the Concorde - that after placing tentative orders.

One "reason" given for reneging was the "noise" factor. It took a few years before it was given clearance to fly into New York - and a change in government.

The Brabazon situation was about the same as "The Arrow."

Thre was no substantial Europen market in those days and the development of the industry was dependent on the American market with its oligopoly.

The Valkyrie was a spectacular success from a technological standpoint.

It was a failure only because (like the Avro Arrow and North American F-108 Rapier) it was no longer needed. The Arrow, Rapier, and Valkyrie were all casualties of the same thinking: that long-range bombers (and the need to intercept them) would be done away with by rapidly advancing missile technology.

The Brabazon was like the Arrow in the sense that its failure was a result of market conditions that were difficult to foresee at the time it was conceived. It was unlike the Arrow in the sense that the Arrow was cutting edge technology, while the Brabazon was designed around huge piston-driven propellers, a much-inferior technology for this application than the jet engines which were already beginning to appear at the time the Brabazon was supposed to enter the market.

On the Concord, sonic boom, and environmentalists...

By this point (ed: 1969 -kimmy) the opposition to the project was growing to a crescendo. Environmentalists were the most influential group, voicing concerns about possible depletion of the ozone layer due to the high altitude flights, and about noise at airports and from sonic booms. The latter became particularly significant, the #1 cause to rally around, and supersonic flight over land was eventually banned. The project also suffered political opposition from the right, who disliked the government subsidizing the development of a commercial aircraft to be used by private enterprise. The anti-SST campaign was led by Democratic Senator William Proxmire, who ran the campaign as a crusade against spending by the federal government.

In March 1971, the U.S. Senate rejected further funding. Afterward, letters of support containing money, nearly $1 million worth, poured in. But the project was cancelled May 20, 1971. At the time, there were 120 unfilled orders by 26 airlines. The two prototypes were never completed.

(taken from http://en.wikipedia.org/wiki/Boeing_2707 )

So clearly, environmental opposition was not just an excuse to snub the foreigners, as the American government applied the same reasoning in pulling the plug on Boeing's project too.

However, a combination of factors caused a sudden cascade of order cancellations, including the 1970s oil crisis, acute financial difficulties of the partner airlines, a spectacular crash of the competing Soviet Tupolev Tu-144, and environmental issues such as sonic boom noise and pollution.

(from http://en.wikipedia.org/wiki/Concorde_%28airplane%29 )

So... aside from concern over spiralling fuel costs and being banned from flying the plane over land, the airlines simply didn't have the money.

At any rate, I think it's highly doubtful that British aviation was "lightyears" ahead of the Americans... if they had any edge at all, it appears to have vanished quite quickly in the 1950s as jet technology emerged and American development was quicker to capitalize on its potential. Further, I think the consolidation of the British aviation companies in the late 1950s/early 1960s is mirrored in Canada and the US, as numerous high-profile projects were cancelled and many aviation firms paid the price. It appears to me that changing military thinking was the cause of this, not political squabbling.

-kimmy

[kimmy]

So guess what. Bombardier has, all this while, as they collected government loans and guarantees to fund an ocean of debt, been PAYING DIVIDEND. I.e. Bombardier has been funnelling tax money into shareholder pockets.

Personlly I find that outrageous. No company should be crying poor and getting relief while they're shovelling the money out the back door.

While I agree, it should be pointed out that this is not just something Bombardier does in Canada:

Many Canadians also feel tax money should not go to wealthy companies. The government defends these policies arguing that they create many jobs and that Bombardier would never have become an integral part of the Canadian economy without subsidies. Bombardier aggressively seeks out state support in every country in which it has plants, and often obtains it, in the form of direct subsidies, tax cuts, free land, previous debt erasure or other forms. To give a few examples: It obtained tremendous sums in indirect ways from the United Kingdom when it acquired Short Brothers of Belfast, and modest but important incentives from the state of Vermont when it opened an assembly plant there. The Government of Canada provided a huge interest rate subsidy for the financing that made possible Bombardier's sale of subway cars to the New York City Transit Authority.

( http://en.wikipedia.org/wiki/Bombardier )

...and I'm sure is pretty common to a wide variety of enterprises in many areas. One of the most glaring examples is in professional sports, where in the US many teams are able to wrangle ridiculous public subsidies for the construction of new facilities. Carrot: "imagine all the jobs, and the economic activity, and land development, and spinoffs it'll create!" Stick: "...but if we can't get help building a new stadium, we'll have to consider moving the team somewhere else..." I am sure that similar carrot/stick discussion dominates the agenda when Bombardier representatives meet with local officials and government types, whether in Ireland or Canada or elsewhere.

Unfortunately it seems like in any discussion involving subsidies, the threat that "if you don't, somebody else will" is pretty credible...

-kimmy

[Guest eureka]

The Valkyrie failed because it kept crashing. It was not a technological success.

How do you think the "environmental" opposition to the Concorde was not politically motivated and motivating. It was welcome to the American industry that was a long way behind.

The Brabazon's technology was cutting edge for years afterwards. Jets have nothing to do with its replacements - remember that jets were a British invention and they would not have been developing the Brabazon had their not been a need for such a craft long into the furure.

BTW, British technological superiority did not disappear until the "80s when Thatcher sold it and British industry to the Americans. Star Wars was an American dream based on the supposed possibilities of that British technology.

[kimmy]

The Valkyrie failed because it kept crashing. It was not a technological success.

Completely, utterly wrong.

There was only one crash of a Valkyrie. And it wasn't due to technological failure: it was because an F-104 was sucked into the Valkyrie's wake during an ill-conceived photo-op, causing a mid-air collision.

The surviving Valkyrie prototype flew for years afterward without incident, being used as a research test-bed by NASA during dozens of flights.

The technological failures of the Valkyrie program were limited to very minor items on the first prototype #1-- a hydraulics leak, a landing-gear malfunction, and some problems manufacturing the high-temperature skin. These problems were completely solved in prototype #2.

The Brabazon's technology was cutting edge for years afterwards. Jets have nothing to do with its replacements - remember that jets were a British invention and they would not have been developing the Brabazon had their not been a need for such a craft long into the furure.

The Brabazon was conceived at a time when the impact of advancing technologies simply wasn't foreseen. This quote explains further:

http://unrealaircraft.com/classics/brab.php

The Brabazon was to fail for reasons of economics. She was conceived following an era when passenger flying in England and Europe was the domain of civil servants in transit, business executives and the well-off. The airliner was viewed in the same light as the ocean liner. BOAC considered passengers would find a long non-stop flight almost intolerable and should therefore be provided with 200 cu. feet for comfort, and 270 cu. ft. for luxury. This equates with about three times the interior size of a modern family car, per airline passenger.

(...)

These design problems might have been resolved; but the development of turboprops and jet engines for airliners changed the conditions which existed during the Brabazon's gestation. Passengers could travel faster, above the bad weather, and large areas dedicated to the comfort of an uneconomically small passenger load were no longer required.

Passengers would not spend 12 hours in a Brabazon when they could reach their destination in a smaller, faster aircraft in seven. By 1952, the economic validity of the Brabazon project was shaky.

-kimmy

[Guest eureka]

All of this was put to good use. Bristol had also won the contract for the "unimportant" Type III aircraft, which they delivered as the Bristol Britannia. Using all of the advancements of the Brabazon meant it had the best payload fraction of any aircraft up to that point, and kept that record for a number of years. Although the Britannia was delayed for a lengthy period after problems with the Type IV, the De Havilland Comet, it would go on to be a workhorse for many airlines into the 1970s. The Britannia is still considered by many to be the ultimate propeller driven airliner.

The Brabazon was the first aircraft with 100% powered flying controls, the first with electric engine controls, the first with high-pressure hydraulics, and the first with AC electrics.

Just a couple of bits of information about the Brbazon, It first flew in 1949 before the Americans knew what an airliner was.

The Brabazon also could have been adapted to take care of the mistaken economic forecasts. The original design proposals had considered the more "democratic" model. But, as I said, the Americans were hell bent on capturing the markets of their former allies and would not buy. That, thoughit took them more than a decade to come up with anything remotely comparable