Ottawa changes requirements for new fighter jets to help European firms to qualify

Canada has modified the mandatory specifications for its next fleet of fighter jets to make it easier for European manufacturers to qualify for the $26-billion contract and foster more competition among five qualified bidders, federal officials said.

Under the previous Conservative government, the requirements for the fighter jets could be met only by the Lockheed-Martin F-35 fighter jet, a stealth aircraft developed by an international coalition of countries including the United States, Britain and Canada.

To allow for a competition, the current Liberal government asked National Defence to revise the requirements to allow more companies to qualify for the contract.

In a briefing this week, federal officials said the government will give bidders additional leeway to meet the requirements, including those related to Canada’s obligations with the United States as part of the North American Aerospace Defence Command (NORAD).

In particular, the requirements for secure communications between Canadian and American aircraft and other military assets were modified to give all potential bidders additional time to meet them. The changes are especially useful to European bidders (Dassault Aviation of France, Sweden’s SAAB Aeronautics and British-based Airbus Defence), given that U.S.-based Lockheed-Martin and Boeing already play key roles in the U.S. military.

“We obviously have NATO and NORAD commitments, with NORAD probably being the bigger one, which means we have significant security requirements that are Canada-U.S.,” said Pat Finn, the assistant deputy minister in charge of procurement at National Defence.

When federal officials will analyze the various bids, he said, they will not automatically disqualify an aircraft that is unable to immediately meet the security requirements.

“We can’t have an aircraft that doesn’t meet it, but what we’ve done is we’ve created the test in a different way … If your proposal, your aircraft, cannot meet [a requirement] today, we are not saying automatically that you’re out; but you have to tell us what is your solution to meet it, at what price and what schedule,” he said on Monday.

The federal government said on Monday it was giving six weeks to interested bidders to provide comment on the draft request for proposals (RFP), which lays out all federal requirements for the fighter jets. The formal RFP is scheduled to be released in May, which will mark the launch of the official competition.

One expert said American companies still have an advantage over their European rivals.

“Whatever aircraft we obtain has to be fully, seamlessly interoperable at the highest levels with the American Air Force and the rest of the U.S. defence establishment, which is going to be tougher for Europeans to do than it would be for the Americans,” said Dave Perry, vice-president of the Canadian Global Affairs Institute. “There’s way to do that, but it would also imply additional cost and integration risk."

Mr. Perry added he is puzzled by the federal government’s assertion that Canada can remain a member of the F-35 development program, while insisting that Lockheed-Martin abide by the federal policy that calls on the winner of the competition to provide regional benefits equal to the full value of the contract.

“The most economically efficient way to buy the [F-35] Joint Strike Fighter is to do so as a member of the partnership,” he said. “However, as a condition of being a member, you have to say that you won’t apply offsets. I don’t really know how the government is squaring those circles at all.”

Conservative MP Rob Nicholson said the acquisition process for the new aircraft remains confusing more than three years after the Liberal took office.

“The bottom line should be what is best for our Air Force and get on with it,” he said.