Full text of Airbus’s statement about C-27 selection in Australia

Airbus Military is highly displeased with Australia’s
decision to go for the C-27J
over its own C-295 (Surprise! Surprise!). In
recent months Airbus Military made a compelling offer, the promise of more A330
multi role tanker transport (MRTT) conversion work provided Canberra plumped
for 10 C-295s and a sixth A330 MRTT – designated the KC-30 in Australian
service. This was not, alas, sufficient to defeat the C-27J.

It was inevitable that Airbus Military would issue a
statement protesting the decision – although for some reason they failed to
post it on their web site. In any case, I thought it would be of interest to our
readers to post their comments on the C-27J selection in full – see below.

Doubtless, journalists (including this one) bombarded defence
minister Stephen Smith’s office for his views on Airbus Military’s comments. Given
all the queries, his PR team apparently opted for an easy fix, replying only to the
Canberra Times, but posting the riposte on the Department of Defence web site. Click here for my story about his comments. 

Apart from Airbus Military, there are others who question
the buy. One Australian industry source I spoke to called the C-27J “a shiny toy
picked by the fighter pilots” who he believes hold sway in the air force. He
said Australia would have been better off forgoing the C-130J and following New
Zealand’s example by upgrading its C-130Hs with new glass cockpits and

He believes the old C-130H can get into 90%
of the airfields that the C-27J can get into. The counter argument to this, of
course, is that the smaller, lighter C-27J is much gentler on fragile remote
airstrips than the big Hercules.

Anyway, opinions about aircraft and their merits are never
in short supply in the defence aerospace sector.

Below is Airbus Military’s position in full: 




Minister Stephen Smith yesterday announced that the C-27J from Alenia will be
Australia’s new Battlefield Airlifter via a $1.4 billion AUD sole source acquisition
of 10 aircraft through a Foreign Military Sales (FMS) process.

            In a press
conference immediately following the announcement, the Minister clearly stated
that there had been a competition between the C27J and the Airbus Military C295

Military is obliged to place on the public record our disappointment at the
Minister’s choice of words, because there was no tender process and certainly
no competition.

            We are even
more disappointed that this decision appears not to have been made out of
rigorous evaluation of tender-quality information for which Australia is justly
renowned and which is normally required before such large sums of taxpayer
dollars are spent. The Department of Defence seems to have rejected its own
tried, tested and proven process of evaluating competing platforms. Following
the selection last year of a new naval combat helicopter, the Department of
Defence stated publicly that holding a competition between the two contenders
had resulted in a 25 percent savings in acquisition cost. 

certainly do not begrudge the ADF making decisions about preferred capability
and platforms following careful consideration of tender-quality and
commercially-binding information. But on this occasion, selection of the C-27J
for $1.4 billion seems to have been based largely on the RAAF’s own desktop
assessments. When compared to other projects with similar size price tags that
go through an arduous process of tender responses and deep investigation of all
areas concerning ownership of a capability, this effort falls short of a full
evaluation process.    

Military proposed the C-295 aircraft as the Caribou replacement. The C-295,
like the C-27J, has recognised strengths and weaknesses. The C-295 is the
world’s most popular battlefield airlifter, with global sales at 100 units. It
is cheaper to buy and operate than the C-27J. For the RAAF’s fleet of 10
Battlefield Airlifters, a C-295 purchase, offered at 400 million AUD would have
provided savings of $1 billion compared to the C-27J FMS.  In addition, the industry involvement Airbus
Military had committed to the Department of Defence and Industry had
substantial components for Australian Small/Medium Enterprises (SME’s) we doubt
could be complied through an FMS case.

            In the
current climate of fiscal restraint and public concerns over Government waste
and expenditure, it is surprising  that
the opportunity to save at least $1 billion AUD of taxpayer’s money was not
sufficient justification to hold a competition to determine which aircraft
option represented the best overall value for money.

            It should
also be noted that Australia has committed $1.4 billion to an aircraft that
will be delivered in 2015 only, representing a three year time gap. Airbus
Military is of the opinion a competition could have been done in this period,
complying with the same schedule, as the C295 could be available in a six
months time period. 

            Airbus Military
considers that the current situation would allow the Government to take the
necessary time to put in place the processes to understand precisely what it
will cost to own and operate the C-27J over the next 30 years, and what might
be the risks involved in operating an aircraft that, according to a US military
report, is “not operationally suitable” and did not achieve the
desired reliability or mission availability rates when deployed to Afghanistan.

Airbus Military expending considerable resources responding to enquiries and
requests for rudimentary information, we are concerned that the outcome may
have been pre-determined from the start.

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