Features Military Procurements
The Maritime Solution

It was almost 10 years ago that Helicopters saluted the awarding of the contract to replace the venerable CH-124 Sea King helicopters in an article entitled, And The Winner Is . . .” with this opening sentence: “The name for Canada’s new ship borne helicopters, the Cyclone, is the most suitable moniker the Department of National Defence (DND) could have chosen, considering the whirlwind of controversy that has battered the project since its inception.”

A Sea King perched on the deck of the HMC Calgary during an exercise with the HMC Regina. (Photo by Paul Dixon)

Since then, the project that was to see deliveries of the CH-148 Cyclone starting in late 2008 has yet to see a single aircraft accepted by the Royal Canadian Air Force for operational duties, leading former Conservative defence minister Peter MacKay to say publicly in 2012 what many were thinking when he deemed it “the worst procurement in the history of Canada.”

In October 2013, the government undertook a “data gathering engagement” request to ensure it was on the right track for selection a replacement. In November, it asked major original equipment manufacturers (OEMs) Sikorsky, Eurocopter and AgustaWestland to make their “best case” for the contract for 28 maritime helicopters. Three finalists were included in the bidding: Sikorsky’s CH-148 Cyclone; the AgustaWestland AW101 (CH-149 Cormorant); and Eurocopter’s NH-90. After a series of meetings in December 2013 with the major OEMs – including Hitachi Consulting, a third-party consulting firm – the federal government decided to endorse Hitachi’s report and commit to Sikorsky to fulfill the Maritime deal. On January 3, the federal government and the Sikorsky Aircraft Corporation announced a Principles of Agreement (POA), which will form the basis of formal contract negotiations to put those recommendations into place, was concluded on December 31, 2013.

“The decision to continue with the Maritime Helicopter Project is consistent with our goals of getting the Canadian Armed Forces the equipment they need while protecting the investments taxpayers have already made in this program,” said Rob Nicholson, Minister of National Defence. “The Royal Canadian Air Force (RCAF) has been providing guidance in determining operational priorities through the newly established Integrated Product Teams comprised of team leaders from Sikorsky and General Dynamics Canada, as recommended by the third party.”

Under the terms of the POA, Canada will see delivery of helicopters with operational capability sufficient to begin retirement of Sea Kings in 2015, and a program to enhance those capabilities culminating in a fully capable CH 148 Cyclone Maritime Helicopter in 2018.

The Royal Australian Navy (RAN) conducts the world’s first maritime trials of the MRH90 helicopter off HMAS Manoora. (Photo courtesy of Royal Australian Navy)

“Under the new terms established in the Principles of Agreement, Sikorsky has committed to deliver the needed helicopter capability at no additional cost to Canada,” said Diane Finley, Minister of Public Works and Government Services. “In addition, the Government of Canada will only issue further payment to Sikorsky upon capability delivery. This is the right path forward for the Canadian Armed Forces and taxpayers.” Sikorsky has also agreed to pay Canada $88.6 million in liquidated damages for non-delivery.

Mick Maurer, president of Sikorsky was stoic in his response to the announcement. “As the pre-eminent helicopter manufacturer in the world, we regret that we have not executed this program to the satisfaction of the Government of Canada and that no aircraft were delivered in 2013,” he said. “We recognize that we and our sub-contractors must do better. We have completely restructured our approach, and added considerable new resources and technical expertise. As a result of the third-party review commissioned by the Government of Canada, we believe we have the right plan in place to deliver the most capable maritime helicopter in the world.”

The restructured program will see the continuation of the initial training and testing of the Cyclone now underway in Shearwater, Nova Scotia. Hitachi Consulting will remain engaged in the project to ensure delivery of a fully capable maritime helicopter.

A Maritime History Lesson
The journey to find a suitable replacement for the Sea Kings has indeed been a long one; they have been slated for replacement since the mid-1980s. The Conservative government led by Brian Mulroney announced in 1987 that 35 EH-101 Merlin helicopters would be purchased to replace the Sea Kings. In 1991, another 15 EH-101s were added to the order to replace the CH-113 in the search-and-rescue (SAR) role, for a reported $5.8 billion for the 50 aircraft. In 1993, when Jean Chretien’s Liberals swept the Conservatives from power, one of his government’s first acts was to cancel the helicopter contract in the name of fiscal restraint, invoking a $500-million cancellation penalty. Some 15 civilian versions of the EH-101s were ordered to replace the Labradors, entering service in 2002 as the CH-149 Cormorant.

As the sun sets on the Sea King, the time is now to provide a reliable alternative. (Photo courtesy of RCAF)

As the cost of maintaining the Sea Kings escalated, the Maritime Helicopter Project reappeared in 2002. The contenders were AgustaWestland’s EH-101 once again, NH Industries NH-90 and Sikorsky’s H-92. The NH-90 was declared non-compliant early in the process and in June 2004, Sikorsky was named to deliver 28 aircraft to be known as the CH-148 Cyclone. The first aircraft were set to arrive in 2008, with all 28 delivered by the end of 2010. In 2007, Sikorsky advised the government they would not be able to meet the 2008 delivery date. The government amended the contract with a new schedule of deliveries, with the first “interim” helicopters to arrive in November 2010 and the delivery of “fully compliant” helicopters beginning in June 2012, including a new price on the contract, not pegged at $1.9 billion, to acquire the helicopters, and $3.4 billion for long-term in-service support.

The auditor-general investigated the Cyclone purchase process in 2010 and concluded that the DND had underestimated the complexity of developing the helicopter for the role it was intended to fulfil. These remarks were echoed by Hitachi Consulting, which was hired by the government in June 2013, in its report released in September. Hitachi looked into the basic issues – is there a reasonable chance the project will succeed and will the project deliver what the RCAF needs from the aircraft in the environment it will be working in?

The consultant’s report states that the government thought it was buying an “off the shelf” helicopter when the contract was initially signed, but in reality, the aircraft was still in development and the government and Sikorsky were clearly misaligned. All said, the report concludes there is a reasonable expectation that the project is still viable and could be achieved within an acceptable time frame.

The government has so far refused to accept the handful of Cyclones that have been delivered on the basis that they are non-compliant, which would seemingly put this aircraft back in the company of the EH-101 and NH-90. Now of course, the challenge facing the government is to decide what it really requires from this helicopter and when it is finally ready, will it be able to ensure its precisely the helicopter it thought it was ordering.

The CH-148 Cyclone is the Canadian name for Sikorsky’s H-92 Superhawk, the military version of the S-92, which evolved from the S-70/H-60 family of “hawks.” The first S-92 flew in 1998. In 2010, the S-92 was selected as the new U.K. search and rescue helicopter, and in 2012, the Irish Coast Guard chose the S-92 as its maritime SAR helicopter, to replace its fleet of S-61s.

The versatile AW101 was one of the leading contenders to replace the Cyclone as Canada’s Maritime replacement choice. (Photo courtesy of AgustaWestland)

All three helicopters that were under consideration for the deal – the AW101, the NH-90 and the H-92/CH-149 – have had some problems in their development. The AW101s Canada purchased to replace the Labradors had issues with tail rotor hub cracking in all 15 aircraft, which resulted in the aircraft being placed on limited flight status until a new tail rotor design was adopted.

The NH-90 program had a slow start in the 1990s and has experienced delivery delays in recent years, which have resulted in some countries buying other helicopters to fill the gap. Finland, Sweden and Norway signed a joint contract in 2001 to purchase a total of 52 helicopters. In 2011, learning that it would have to wait until 2020 for the last of its NH-90s to be delivered, Sweden purchased 15 UH-60M Black Hawks. Australia also purchased 24 Black Hawks when its order of NH-90s fell three years behind schedule.

After 10 years of active service, the CH-149 Cormorant fleet had surpassed 50,000 hours, with a reported 99 per cent dispatch availability. However, for Canadians, the S-92/CH-149 will forever be remembered for the 2009 crash off the coast of Newfoundland that killed 17 of the 18 people on board.

Which brings us back to the eye of Helicopters’ perfect storm, 10 years on. If there was a cyclone of controversy then, where does that leave us now? This is a project that has been kicked around so long it looks like a soccer ball with half the air gone. Count back from the first time someone in Ottawa thought about replacing the Sea King and we’ve had too many elections to remember, eight prime ministers and several squadrons of defence ministers. The Sea Kings have more than proven themselves and deserve the rest they so richly earned, as the helicopters that made the Royal Canadian Navy the scourge of Cold War submarines.

So now the decision has finally been made, will the CH-148 Cyclone rise like the Phoenix from the ashes of non-compliance? In 2003, there was widespread speculation that the NH-90 was the choice of the military, before it was deemed non-compliant. Then, when the Cyclone was chosen, it was felt by many that the prime reason it was chosen was that it was not the AW101, as the fallout from the previous contract cancellation was still too hot to handle. This may well be the worst military procurement in Canadian history. The sad thing is that so many people in government have had the opportunity to turn it around by simply saying “enough,” but they haven’t and it’s not because they haven’t had the opportunity.