Northern Insights / Perceptivity: $20 billion± procurement – no bid, no competition

The Harper Government of Canada is continuing on a path to acquire Lockheed Martin F-35 multirole fighter jets. First Canadian deliveries originally were anticipated in 2016 but the U.S. Air Force reported in March this year that it expects a two-year delay in the airplane’s initial operational capability, which would push it back to 2018.

Deliveries to this country are unlikely to begin before 2020 and the program cost, initially estimated at $18 billion including maintenance agreements, will rise dramatically. The country’s largest ever procurement is a single-sourced deal, made without a competing bid.

Further delays and cost increases are likely because in August, for the third time in less than a year, the Pentagon grounded all F-35 joint strike fighters because of mechanical problems. Numerous problems remaining.

Senator Carl Levin, chairman of the U.S. Senate Armed Forces committee, said the cost growth could have significant implications for the rest of the Pentagon’s multibillion-dollar acquisition programs and for its budget as a whole. The Michigan Senator said,

“People should not conclude that we will be willing to continue… strong support without regard to increased costs coming from poor program management or from lack of focus on affordability.” 

Further reading:
Canada stands firm on F-35s as questions fly on price and production
Why the F-35 stealth fighter is wrong for Canada
Pilot Error

Continue reading