Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Quote  |  Bullboard  |  News  |  Opinion  |  Profile  |  Peers  |  Filings  |  Financials  |  Options  |  Price History  |  Ratios  |  Ownership  |  Insiders  |  Valuation

DISCOVERY AIR INC 8.375 PCT DEBS T.DA.DB.A



TSX:DA.DB.A - Post by User

Post by MYSTICALon Aug 22, 2016 12:35pm
246 Views
Post# 25164268

Good article

Good article

Red Storm Rising - C$1.5 billion up for grabs as Canada’s Contracted Airborne Training Services (CATS) competition gets serious

Background

Two years after i took the above photograph whilst providing aggressor support at RED FLAG 03-4, the Canadian Department for National Defence (DND) transitioned from the military provision of air support to an 'Alternative Service Delivery' to reduce service manpower and to counter the lack of available Capital Department Expenditure Limit (CDEL) for the purchase of new aircraft purely to provide Red Air. Following a competitive process which was won by Top Aces, now Discovery Air Defence Services (DADS), an Interim CATS (ICATS) contract was signed for 3 years which was extended to 5 years and subsequently beyond 10 years.   

The current CATS competition is on its 3rd itteration due to political intervention following perceptions of incumbent bias along with the winning bidder being prematurely disclosed. The RFP was re-released in August 2015 and following its closure in February 2016 there have been 3 bidders, one of which remains anonymous. The other two comprise the current incumbent DADS and a Canada-based joint venture between CAE Canada and Florida based Draken International.

The Requirements

The programme calls for the ability to to conduct the following mission presentations: Red Air, Aircraft Intercept, EW, Targeting/Imaging, Target Tow - Naval and Air Gunnery along with CAS. It is the last presentation that differs greatly from the extant contract with the requirement now extended to include: Digitally Aided Close Air Support (DACAS), EO/IO Targeting Pod, Inert Bomb drop, IR Spot Tracking and NVG capability.

Looking to the aircraft requirements, the multi-role combat support fighter (MCSF) must be able to operate from a 6,000ft runway, have a threshold of 480kts at 1,000ft AMSL and an objective speed of Mach 0.85 at any altitude, capable of -2g to +5g and a service ceiling of FL350. The medium endurance aircraft (MEA) must have a minimum speed threshold of 300kts at 1,000ft AMSL and an objective speed of Mach 0.7 at FL300, operate between -1g and +2g with a service ceiling of FL350. The number of aircraft provided will be left to the contractor but they must be able to sustain up to 8 continuous MCSF task lines and to 2 MEA task lines - the current contract has seen surges up to 14 aircraft.

The requirement for the MCSF to be radar and DASS equipped along with being capable of supersonic flight was made non-mandatory in order to broaden the market place. This has been seen as somewhat of a surprise move given that the Royal Canadian Air Force (RCAF) are looking to replace legacy CF-188s with a potential 5th Gen capability and one that has been echoed by many RCAF personnel who see this as a minimum in order to be representative of the minimum baseline threat. 

The Contenders    

Prima facis, DADS would appear to be competing from a position of strength having been the incumbent since the inception of CATS during which they have amassed over 55,000 flight hours in support of the DND. In fact the author witnessed their professionalism during the support they provided to our armoured battle group exercises on the plains of Alberta in 2010 whilst assigned as an Air Liaison Officer (ALO). It's strategy doesn't envisage much change to the current service provision using both Alpha Jets and Westwind 1124 business jets to satisfy the MCSF and MEA requirement with augmentation by the companies non-radar and non-DASS equipped A-4N aircraft (currently used by their subsidiary Top Aces in Arizona and for their contract with the Luftwaffe out of Wittmund, Germany).

Recent interviews at CANSEC with Garrick Ngai, DADS Director of Marketing seem to suggest that the company is still looking to incorporate radar and electronic attack (EA) capabilities into its aircraft fleet through the acquistion of 29 Block 10/15 F-16s from the Israeli Air Force to cater for Typhoon, Rafale, Raptor and Lightning II training requirements. This however seems contrary to recent comments by the US State Department refusing an export license citing ITAR concerns; as such i would offer the opinion that this remains an elusive pipe dream and that the State Department would not look to disadvantage a US company against their competitors. I would expect to see DADS upgrade current platforms with both emulation and synthetic capabilities to meet the changing operational training landscape which would enable them to link-in with the RCAF simulation strategy in the future and build a stepping stone into the Live, Virtual and Constructive (LVC) domain. 

The other contender named as submitting a bid under the RFP is CAE/Draken International whose credentials are widely acknowledged. CAE pretty much dominate the synthetics space and recently acquired the NATO Flying Training in Canada (NFTC) programme from previous incumbent Bombardier. Draken International's pedigree is firmly routed in high-end red air provision having routinely supported the USAF Aggressors on RED FLAG, provided Operational Test and Evaluation (OTE) in support of the F-35 Lightning II programme and have recently taken on the CAS contract in support of the USMC. They bring with them a wealth of experience from the 5th Gen arena and many familiar names such as 'Mr Tomcat', Captain Dale Snodgrass USN Retired. 

Their proposal centres around a combination of A-4 Skyhawks and Lear-35s to fill the MCSF and MEA requirements. This seems a broadly similar submission but Draken International's Skyhawks are not just the garden variety A-4Ns, eight of the proposed Skyhawks are the A-4Ks formerly belonging to the Royal New Zealand Air Force (RNZAF) all of which contain the KAHU upgrade:

  • APG-66NZ multi-mode (12) radar.
  • Smith's Industries Nav/Attack System and laser ring gyro.
  • HOTAS, MFDs and Ferranti wide angle HUD.
  • ARN-118 TACAN.
  • VIR130 VOR/ILS.
  • ARC-182 U/VHF & ARC-159 UHF radios.
  • ALR-66 Radar Warning Receivers (RWR) and ALE-39 chaff and flare dispensers.

Speaking recently Vice President & General Manager of CAE, Mike Greenley said that few modifications would be required as the current high-fidelity systems likely exceed the stated RCAF requirements. Admittedly 50% of the current CATS requirement could be met with training jets and emulators that meet the minimum compliancy standard but i offer the view that a real radar and DASS that gives the capabilities of a F-16MLU would be much more representative and deliver enhanced training benefit across many of the mission profiles. CAE offer a direct route into any future LVC construct and architecture that the RCAF may be looking to undertake.

Certification, Regulation and the Canadian Angle

Perhaps the biggest key to this entire competition is the appearance that it is a Canadian solution. Certification and regulation is pretty clear with all aircraft being required to be dual-certified by both civil and military airworthiness systems meeting CAR 702, subject to audit by both the civilian and military aviation authorities and fully integrated into the RCAF Flight Safety System.

DADS Canadian pedigree is thoroughbred with most of its pilots being ex-RCAF with weapons school qualifications, many of whom still serve in the reserve; maintenance personnel are largely drawn from the civil sector and all staff are required to be able to gain and maintain a security classification of Secret. The quality of staff has been identified as the key advantage with personnel being able to both instruct and demonstrate adding value at every level of the training serial.

The Canadian registered joint venture between CAE/Draken International has already stated that all aircraft will be registered, operated and maintained in Canada by CAE employees. In fact Mike Greenley goes beyond the realm of pilots and maintainers stating that national supply chains will be used where ever possible to meet any OEM maintenance requirements. I also have no doubt that its pilots would be of a similar vain with over one thousand hours fast-jet and a weapons school or equivalent qualification.

The final elements in this conundrum revolve around the future of the EWO specialisation within the RCAF where all parties acknowledge that military provision is expensive, as such have the RCAF stipulated that this will remain a military provision as specified in the current CATS contract or have they removed this constraint? Issues of outdated Government Furnished Equipment (GFE) exist too and are specifically linked to lack of Advanced Digital Radio Frequency Memory (ADRFM) and Complex Threat Simulation pods.

Much will depend on the assessment phase of the competition based upon the pass/fail criteria on compliance and certification, especially how they balance the requirement focus between solution and managed service provision. Elements will no doubt carry greater weight enabling higher scoring if above the threshold or objective levels, particularly relating to the MCSF elements. 

The Decision

With contract award expected by the end of 2016 CATS is clearly the priority for those involved. Whoever the victor is, the DND will receive a thoroughly professional service and one that will help to erode those concerns held by many in uniform on both sides of the Atlantic that it undermines service ethos and detracts from training value. The future incumbent will need to be agile to adapt through life to the rapid changes that will occur between now and 2030 across the profiles that it is expected to deliver.  

Both DADS and CAE/Draken International are looking beyond Canada and are hoping to use their CATS experience as a springboard to emerging markets. They each have a foothold in Europe but it's a complex environment due to the varied regulatory framework that exists, EASA is certainly not the solution and the national military regulatory framework is probably the only avenue moving forward. Several European NATO countries are embarking on replacement programmes along similar lines to CATS and there is talk that NATO itself is looking to revamp TLP at Albacete, Spain to include a dedicated red air aggressor unit.  


Bullboard Posts