Saturday, August 18, 2007

Caveat Emptor - Airbus the Sequel

The egg may be congealing on the pusses of the Ottawa gang who were gloating over the recent arrivals of Canada's newest military hardware. Canada received, this past week, its first, of 4, C-17 'Globemaster III' Boeing cargo jets. Yesterday Canada's first Leopard 2's rolled off an Antonov heavy-lifter onto the tarmac at Khandahar airport.

The army was ecstatic with the tanks, a hundred of so will put Canada back into the mechanized forces category on a numerical par with Poland and Hungary. The Afghan contingent will appreciate the climate-controlled environment rather than the water filled cooling vests they had to wear. Mind you, if one of those liquid metal IED penetrated the tank, I'd rather have a 1/2 inch of cold water between me and it, rather than a tankers' coverall and some climate-controlled air. But they're sure the 'cats' will put the wind up the Talib.

The C-17's are the offspring of the reconciled lumber trade dispute that first arose 5 years ago.

The WTO ruled in Canada's favour and the US had to repay some tariffs they had imposed on Canadian lumber - about $5 billion worth . Being the business types they are, the Yanks wanted us to take it 'in trade'. So we bought 4 'big birds' for 3.4 of those billions. Enough to move all of Canada's new tanks for servicing in Holland over the course of any two-month period.

Now the interesting part. Up until those 4 big birds are flight tested and the crews worked up to speed, Canada will continue to depend on leased Russian heavy movers to get its forces positioned and supplied. Yesterday, an Antonov-124 'Ruslan' brought two Leopards from Holland to Afghanistan. The same day the Russians announced their whole 'Ruslan' fleet was going up for sale - all 32 aircraft. The asking price is estimated to be somewhere in the area of 350 - 500 Million dollars.

It seems strange to be laying out 3.4 billion dollars for 4 aircraft, when 1/6 of the price would have bought 32 of them. It's not as if the Ruslan isn't a good aircraft, the CAF has used them repeatedly. And it isn't that the C-17 is a vastly better aircraft - it isn't. It seems comparable but might lose on the maintenance requirements to the rougher Russian bird. The big difference is cost. What couldn't Canada have done with 2 and a half billion dollars, other than delay the close of Boeing's Seattle C-17 operation for a few months.

Sometimes you get what you pay for, and sometimes you don't. If we hadn't been owed those lumber billions, those Ruslans would look even more like the good deal they are. Looking on the bright side we got our Globemasters 'free'.

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