By Graham Warwick in Washington DC
Ottawa poised to confirm $5 billion deal for transports

Released on 2 May, the first budget by Canada’s new Conservative government is expected to provide a massive increase in defence spending to pay for both Boeing C-17 strategic and Lockheed Martin C-130J tactical transports.

Local reports late last week suggested a compromise had been reached between chief of defence staff Gen Rick Hillier’s requirement to replace Canada’s deteriorating C-130Es, and defence minister Gordon O’Conner’s need to fulfil election campaign promises to buy strategic transports.

Boeing has made an offer for up to six C-17s, while Lockheed has presented a proposal for 16 C-130Js. A combined purchase could exceed $5 billion. In advance of the budget’s release, government officials were saying only that there would be a “substantial commitment” to the military.

Boeing is proposing a direct commercial sale of C-17s to Canada, with training and support to be provided through the US government’s foreign military sales system. This would allow the Canadian Forces to use the existing global support programme and pay a pro-rated share of the cost of supporting the worldwide C-17 fleet, says Tommy Dunehew, Boeing’s programme manager, international sales.

The US Air Force is prepared to give up production positions to allow early delivery to Canada, possibly of three aircraft in 2007 and three in 2008, says Dunehew. Australia’s first of up to four C-17s is scheduled to be delivered in December, the second in June next year and the remainder by mid-2008.

Canada is among several countries that have been given until June to commit to the C-17 or face higher prices once production for the USAF ends in 2008 at 180 aircraft. With US Congress debating funding seven more USAF C-17s, Boeing is looking for at least 13 foreign sales to keep production at around 15 a year.

Boeing wants to keep the C-17 line open until there is a decision on re-engining the USAF’s older Lockheed C-5As. A mobility capability study completed late last year concluded that 180 C-17s and 112 modernised C-5s were sufficient to meet USAF requirements, but a decision to upgrade the As will not be taken until after a re-engined aircraft has flown in 2009.

■ The US Air Force has removed its ageing E-model Hercules from Boeing’s C-130 avionics modernisation programme (AMP), citing centre wing-box cracks (Flight International, 18-24 April). Its decision leaves 434 aircraft scheduled for AMP, including C-130Hs and special-mission AC-, EC-, HC-, LC- and MC-130s.

Source: Flight International