Scrapping F-35 plans not likely to offer savings for Canada

Experts are sceptical that Justin Trudeau’s Liberal government will generate any savings from scrapping Canada’s F-35 purchase plan.

Canadian Prime Minister Justin Trudeau promised during the recent election campaign to look elsewhere for a new combat aircraft and divert the savings into more ships for the Royal Canadian Navy. However, it is believed that different aircraft might not be a bargain when the costs of buying, operating and maintaining them over 20 to 30 years are tallied up and compared to the F-35.

George Petrolekas, a retired colonel with the Canadian Global Affairs Institute said:

“I don’t think it will produce the magnitude of savings that they think will fund the shipbuilding program, I don’t think there will be a significant savings in acquisition and I suspect there probably won’t be a significant savings in operating costs either.”

The F-35 programme is often labelled a “trillion-dollar black hole”, the man in charge of the project vehemently disagrees and lays to rest any fears over rising costs.

Lt. Gen. Chris Bogdan, the head of the F-35 joint program office, hosted a press event with reporters in defence of the programme, citing constant drops in the cost of the jet.

“It is a fact this program is over budget from 2001’s baseline. It’s just true. We will never underrun that number. We will never save that money. It’s gone. What matters is since that time, what’s happened to the cost on the program? It’s gone down, not gone up. Judge the program today, not where it’s been, but where it is and where it’s going.”

Bogdan also pointed out that this year’s selected acquisition report (SAR) noted reducing procurement costs, down by $3 billion. The report can be found here if you wish to verify this information.

The average cost-per-unit in low-rate initial production lots six, seven and eight, the last three lots on contract, have fallen. The below figures also include engines and adjust for inflation.

• F-35A conventional takeoff and landing model: $117 million, $112 million, $108 million.
• F-35B “jump-jet” model: $145 million, $137 million, $134 million.
• F-35C carrier variant: $134 million, $130 million, $129 million.

The F-35 Joint Program Office (JPO) commented:

“Affordability is the number one priority for the F-35 program and this year’s report reflects another year with significant cost reductions and we’re not stopping there.  We will continue to drive costs out of the program. The F-35 Joint Program Office has a disciplined approach to analyzing and reducing sustainment costs. Ongoing activities include conducting a sustainment business case analysis and operating a cost war room to find program savings and attack operational, sustainment and total ownership costs.

F-35 unit recurring flyaway costs have been going down with each successive lot of aircraft. Lockheed Martin and Pratt & Whitney have track records for delivering the airframe and engine below government SAR estimates and we expect this trend to continue in the future.”

The unit price of an aircraft is a small portion of the overall cost of owning and operating it over decades.

Mr. Trudeau’s Liberals, who take power in Ottawa in early November, campaigned on a promise to jettison the Lockheed Martin F-35 as an option for replacing Canada’s aging CF-18 fighters.

The previous Harper government had planned to buy 65 F-35s.

The Liberals pledged to buy “an equal or greater number of lower-priced, but equally effective, replacement aircraft.” How they plan to do this however has mystified many.