Canadian company remains optimistic of becoming prime contractor south of border

Canadian-owned CAE is backing away from a contention that the US Army rejected its bid for a $1.1 billion training services contract last September because the company was based on foreign soil.

CAE filed a protest after the Flight School XXI contract was awarded to US-based Computer Sciences (CSC), a decision which led chief executive Derek Burney to claim that CAE's Canadian ownership would present an obstacle in future US military competitions. The company also claimed that its proposal was 16% cheaper than CSC's bid.

The US General Accounting Office on 12 January ruled against CAE's claim, freeing the army to continue work with the CSC team. Meanwhile, the army's disclosures during the appeal process have helped CAE to "understand fully" how it lost and provide insight into the US acquisition process, says Andrew Morris, its executive vice- president for strategy, military training and simulation.

CSC's previous record as a prime contractor was also considered a key factor in the army's decision, says Morris. By contrast, CAE was hoping to break in to the US military market as a prime contractor through the Flight School XXI programme. CAE's bid was also drawn up based on the desires of the user community, but turned out to come down on the wrong side of an argument over requirements between the acquisition agent and the user community. The users "did not have as much influence over the process" as CAE had assumed, says Morris.

CAE has reassessed its ability to enter the US market as a prime contractor and remains hopeful about its immediate prospects. The company's products have been chosen by both Boeing and Lockheed Martin for the USNavy's 100 aircraft-plus Multi-mission Maritime Aircraft programme, with a decision expected in April.

Source: Flight International