Thursday, December 11, 2014

Canadian report confirms continued F-35 price increase.

Major thanks to ELP Blog!


via Ottawa Citizen
Defence officials estimate they will actually need more than $1 billion in contingency funds to protect against the effects of a weaker Canadian dollar, inflation and other countries cutting back on how many planes they purchase.
The report suggests that if an extra $1 billion is needed, “the remaining shortfall could be met by buying fewer aircraft.” It adds that the government “will consider the frozen acquisition envelope,” suggesting the $9-billion cap could be removed.
An attached government-commissioned review of National Defence’s numbers by Quebec accounting firm Raymond Chabot Grant Thornton noted defence officials had not actually studied whether it was feasible to buy fewer than 65 F-35s.
Canada had originally planned to purchase 80 F-35s to replace its CF-18s, but scaled back the order in 2006. The government has not said why it reduced the plan, but senior military commanders have suggested 65 is the minimum the air force needs.
Read the whole thing but what you see in the above passage is a classic "death spiral" scenario.

You heard it here first boys and girls.

This turkey is about to die.  The world economy is probably going to be the main culprit too.  The F-35 was based on a weak dollar, high oil prices and continued growth in Europe and China.  We're seeing the exact opposite now.  A strong dollar (getting stronger all the time as Southern Europe and China continue to slow down), cratering oil prices and weak consumer spending world wide.

This does explain the "extra" F-35 in that sinful Congressional bill though.  They're trying desperately to increase production but it just isn't working.

This is going to be fun to watch.

9 comments :

  1. Angled off hard points for safe release of ordnance seems to be in vogue since F18 E/Fs botched aerodynamics to a degree that bombs would hit the airplane.

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  2. That is a very impressive weapons payload... There are pictures of the F15E demonstrator carrying ~20 500IB bombs and another with ~20 cluster bombs and 2 sidewinders, and the F15 was a downgrade in throw weight from the F111. You can probably stick more weight on the inner pylons, maybe on the middle pylons too but it doesn't look great in terms of ground-attack capabilities, which is sad since it is supposed to be a bomber.

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  3. Canada's procurement budget has $9 billion for procuring a replacement fighter plane, and Canada needs a minimum 65 planes (it was 80). That's a max unit procurement cost of $138 million that Canada can afford.

    The current unit procurement cost of the F-35A is $185 million.

    There's also the life cycle cost. The estimates have increased over the last several years:
    (in billions) 9, 25, 40, 45 -- now 71.

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    Replies
    1. Then there is the Canadian Naval shipbuilding program with estimated procurement costs of $39B and a 30 year life cycle of $122B.

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  4. Hmm what was the last fighter with gunpod ,Vietnam era F4D LOL

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  5. "..the effects of a weaker Canadian dollar" -- The loonie (Canadian dollar) isn't doing well. It's now at 87 cents US, and economists have forecasted that the loonie will sink to about 85.5 cents by early next year, then edge lower in the second quarter and then close in on the 81-cent level by the third quarter.

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  6. as crazy as it sounds,ci have to agree that canada should have nukes, why dont america put some icbm silos in canada ? it is mostly desolate wilderness with no human settlement for thousands of miles..

    and while we at that, why not letting south korea, japan, germany, iran, saudi, australia and israel all have nukes for defensive purposes ? i mean it will deter their enemies right ?

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  7. The interpretation of flight global

    http://www.flightglobal.com/news/articles/canada-rates-f-35a-rivals-equal-on-most-missions-407025/

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