The Harper government is once again re-negotiating the contract to replace the air force's outdated Sea King helicopters, the Canadian Press has learned.
Senior officials at Sikorsky Aircraft, maker of the CH-148 Cyclone helicopter, recently told financial analysts the company is bargaining with Public Works to "reach agreement on an alternative contractual solution" for the troubled program, already five years behind schedule.
"I don't want to negotiate in public about what they want, but what they want is, certainly, sounds perfectly reasonable," Michael Maurer, president of Sikorsky said during a question-and-answer session. "They want their aircraft the way they ordered them. The issue is that this is a development program, and it really wasn't structured as a development contract. So we're both trying to navigate that and they have to follow their procurement rules and regulations."
Maurer also said not meeting a commitment to hand over test helicopters would be good for the aircraft-maker's bottom line in the short term. "If we do not deliver the five [Canadian Maritime Helicopter Program] aircraft this year, then Sikorsky will of course realize operating profit growth above our guidance range," he said.
"It is important to note that excluding [Canadian Maritime Helicopter Program] deliveries, we will demonstrate our ability to get to a 14 per cent return on sales in 2012, two years ahead of the original time line for this goal, and this really demonstrates strong operational performance being achieved across all of our business units and long-term potential for Sikorsky to be a mid-teens return business."
The comment drew a sharp rebuke from the Opposition defence critic. "It's not the Canadian taxpayer's job to ensure the best bottom line possible for Sikorsky and its owners," said the NDP's Jack Harris.
The $5.7-billion contract to buy 28 helicopters was signed by the Liberal government of Paul Martin in 2004, a milestone event in the two-decade fight to find a replacement for the CH-124 Sea Kings, after former prime minister Jean Chretien cancelled the first deal in 1993.
Sikorsky was required to deliver new state-of-the-art aircraft within four years, but the Harper government was forced to extend the contract in 2008 and toss in an extra $117 million after the program bogged down.
In constructing the Cyclones, the U.S. aircraft giant took a civilian helicopter design - the S-92 - hardening it with improvements and electronics for military use.
The Sea Kings will celebrate 50 years in service next year.
