The Nation's Business

Ottawa is poised to make a bad decision on choppers

It looks as if the Liberals will order the costly, over-powered Italian helicopters they rejected four years ago

Peter C. Newman November 24 1997
The Nation's Business

Ottawa is poised to make a bad decision on choppers

It looks as if the Liberals will order the costly, over-powered Italian helicopters they rejected four years ago

Peter C. Newman November 24 1997

Ottawa is poised to make a bad decision on choppers

It looks as if the Liberals will order the costly, over-powered Italian helicopters they rejected four years ago

Peter C. Newman

The Nation's Business

When Jean Chrétien took power in the fall of 1993, the freshly minted prime minister made two dramatic decisions to differentiate his government from that of the hated Brian Mulroney: he cancelled Toronto’s Pearson airport modernization contract and killed the Conservatives’ controversial military helicopter purchase. After months of legal wrangles, the airport renewal was reinstated under different auspices, costing taxpayers $1 billion to settle outstanding suits and other matters. Now, it looks as if the Liberals are about to opt for virtually the same aircraft they rejected with such fanfare four years ago, although they have already spent $480 million to cancel the original contract.

Canada’s last major defence expenditure of the 20th century is in the process of being approved by a confused cabinet, and there seems to be a serious flaw in the process. The need for purchasing new whirlybirds is not in question. The aircraft currently being used by Canada’s navy are not just out of date, but demonstrably hazardous to their crews. Involved is an initial purchase of 15 helicopters for essential search and rescue missions, currently being handled by 13 obsolete Labradors, built more than 30 years ago.

On top of that, another 35 machines will be ordered to provide the navy’s high-tech fleet of patrol frigates with copters to be used mainly for marine surveillance, replacing the 35-year-old British Sea Kings. The original 1992 price tag for these 50 replacements along with spare parts and maintenance costs was a hefty $4.4 billion, of which more than $1.5 billion was strictly the acquisition cost for the 50 helicopters. The Mulroney government chose a huge, luxurious chopper, called the EH-101, the “eh” presumably put there by its manufacturer as proof of Canadian content. The three-engined, multi-role helicopters are made in Italy by the Agusta/Westland consortium, though there were and are some plans to include minimum domestic subcontracts.

The Chrétien government’s justification for dropping the EH-101 in the first place—apart from the fact that it carried Mulroney’s stamp of approval—was that it was far too costly for the job it was designed to accomplish, and that cheaper models were available that were even more suitable for their twin assignments. For the search and rescue function, for example, the EH-101’s critics pointed out that these aircraft were so large that their pilots couldn’t see over their fuselages to spot the people they were rescuing. And their engines were so powerful that the down-wash from the rotor blades would probably drown anybody requiring rescue in the first place. What was needed, according to Chrétien, was not a Cadillac but a Chevrolet.

Now, it looks like we are back to a Cadillac—or at least to an Oldsmobile—and that Defence Minister Art Eggleton agrees with the preference being quietly touted by the military. In one of the most hotly contested lobbying efforts in the murky history of that dubious art form, representatives for rival firms are making their case for alternate aircraft, convinced that the final decision will be made in the next few weeks.

Eurocopter Canada Ltd., which represents the leading rival, Cougar Mk 2 helicopters, made by France’s Eurocopter, is convinced the defence department favors the EH-101 to the exclusion of equally capable cheaper units.

Another of the bidders, Sikorsky Aircraft Co., a member of United Technologies, a U.S. consortium, has formally objected to the DND rules, complaining that “the weighting factor assigned in the evaluation database represents a critical disadvantage for helicopters with smaller cabins, which can accommodate fully the personnel and equipment requirements.” Both companies claim that 70 per cent of the factors in one critical section being used by the DND in scoring the selection process are related to cabin size, which effectively eliminates all aircraft except for very large helicopters such as the Italian-made EH-101 and the Boeing Chinook. The defence department maintains that because of Canada’s large terrain and severe climate conditions, the 15 helicopters must be large enough to carry five crew members, up to 10 survivors as well as all the equipment required for a rescue at any one time.

Murray Ramsbottom, a member of the French firm’s board of directors, also charges that DND’s formal request for proposals, issued in November, 1996, includes cabin size criteria that only the EH-101 aircraft can meet. In correspondence with members of the Liberal caucus, Ramsbottom points out that so far only two world navies—the Italian and British—have purchased the huge EH-lOls, while the French version now has close to 500 models in the air, flown by 76 customers in 45 countries. But the main argument for the Cougars, and some of the other alternatives, is their low acquisition and operational costs. Fifteen Cougars would cost about $400 million.

The Italian EH-101 manufacturers are promising to produce a new Cormorant model, which they say is marginally cheaper than the current configuration, once inflation is taken into account. The old cancelled model cost $462 million for 15 helicopters while the new Cormorants would cost about $530 million in today’s dollars. EH-101 boosters say the higher price is really a bargain, because the purchaser is getting a much larger and more technically advanced aircraft than its competitors.

Whatever the merits of these competing flyers, the deal clearly deserves to be reviewed by impartial experts. We don’t need and can’t afford flying Cadillacs.