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Feds elect to stick with CH-148 as Sea King replacement

Jan. 6, 2014, Ottawa - The federal government has decided not to scrap its troubled purchase of CH-148 Cyclone helicopters.


January 6, 2014
By The Canadian Press

Topics

Instead, Ottawa will go ahead with its plan to acquire the maritime
choppers to replace the decades-old CH-124 Sea Kings, which it will
start retiring next year.

The plan to replace the 50-year-old Sea Kings — which fly from the
decks of Canadian warships — is years behind schedule, millions over
its original price and is apparently beset with technical glitches.

Last year, the Public Works Department indicated it was looking at
other aircraft because Cyclone manufacturer Sikorsky had delivered just
four test aircraft, which National Defence has refused to formally
accept.

Public Works had previously asked for an independent analysis of whether Sikorsky could deliver what it promised.

The government says that report found the program to replace the Sea
Kings "would be viable with a different project structure and governance
model."

A news release issued late on Friday afternoon says the air force will have fully capable Cyclone helicopters by 2018.

Public Works Minister Diane Finley said Sikorsky has agreed to deliver
the new helicopters without any additional cost to the federal
government.

When asked for more details, a government spokesman would only say
Public Works accepts the independent analysis and referred to
"negotiated Principles of Agreement with Sikorsky Aircraft Corporation"
that would "form the basis of formal contract negotiations that will put
these recommendations into place."

Public Works also said negotiations to amend the contract with Sikorsky
will begin early this year and will hopefully be concluded by the end
of March.

The original contract signed with Sikorsky in November 2004 was valued
at $5 billion in total — $1.8 billion was allocated for the acquisition
of the choppers and $3.2 billion was for in-service support.

The value of the contract increased in 2008 to $5.3 billion, with $1.9
billion for acquisition and $3.4 billion for in-service support.

So far, Sikorsky has accrued $88.6 million in liquidated damages for its failure to meet the contract.


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