L-3 Communications Integrated Systems, L.P., Greenville, Texas, is being awarded a $321,770,026 firm-fixed-price contract to purchase 10 C-27J aircraft, 10 option kits, and one lot each production cost and software reports and contractor logistic support cost and software reports for the Commonwealth of Australia by issuing a delivery order. The location of the performance is Greenville, Texas. Work is to be completed May 24, 2012. ASC/WLNJ, Wright-Patterson Air Force Base, Ohio, is the contracting activity (W58RGZ-07-D-0099 0078).
Friday, June 1, 2012
DOD contract for FMS sale of 10 C-27Js to Australia
DOD Contract...
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21 comments:
Where does the other $1.1 Billion go?
Sorry, Still Perplexed.Typo
Does your car only cost the money you give to the dealer?
Now scale it up, a lot.
Defend the indefensible if you can.
Oh my goodness, just saw fairies at the bottom of my garden, must dash.
The Defence Minister's news release announcing the purchase said the 1.4 billion also included, "Initial logistic support, including training for aircrew and maintenance personnel will be provided through the FMS program..."
It was foolish of the Government to fail to explain that the unit price was $32 mill. They should have also explained to the taxpayers how long the "initial" support period is, because a longer term maintenance contract is yet to be signed.
http://www.minister.defence.gov.au/2012/05/10/minister-for-defence-and-minister-for-defence-materiel-joint-media-release-new-battlefield-aircraft-for-the-air-force/
Even the 25 year life-cycle costs predicted by USAF (considered high by some) do not come anywhere close to $1B~$1.1B.
http://goo.gl/Gb1ID
"Furthermore, the Pentagon contract announced yesterday (see above) confirms L-3’s price estimate, and sets the price of the ten aircraft at precisely $321.7 million.
It is obviously impossible that the initial logistic support, including training for aircrew and maintenance personnel described by the minister could account for the difference, or $1,079 million.
There are only very few ways to account for the missing billion+ dollars: (a) supporting the ten aircraft for an “initial” period is three times as expensive as buying them; (b) the minister and his staff can’t count, or (c) the missing billion + is headed elsewhere. "
http://www.defense-aerospace.com/article-view/release/135630/%24322m-contract-raises-new-questions-about-australia%E2%80%99s-c_27j-buy.html
Yes, as suspected DMO and Defence do not have clue.
Proper accounting standards differentiate between Capital Purchases and the cost of running that equipment.
There is no transperacy at all, and they treat the shareholders, us, with contempt.
Instead of getting all butt hurt as you normally do, you could just wait til the annual reports come out and find where that expenditure goes? Aust DoD made a big change several years ago (when we bought the Super Hornet in fact) to it's project reporting. The change was that we now include an initial support and logistic package in our upfront reporting costs. The initial logistic support period for Super Hornet was 10 years, subsequently upped to 13 years. Anyone want to go on record and state categorically this contract doesn't include a similar period of support? Are you honestly going to argue that the support costs should be announced, Perplexed? As if the taxpayer shouldn't be aware of what these aircraft are REALLY going to cost, rather than the initial cost only that defence-aerospace would seemingly rather report?
Every single dollar IS accounted for in those documents. Instead of carrying on like children, one would hope that you could actually learn to do some very basic research and educate yourselves?
Apparently that is too much to expect. Oh dear...
As to contract prices, this $322m contract doesn't include the cost of modifying the aircraft with BFT, the battle management systems, the EWSP kit, the advanced comms systems and so on. This is a basic production contract for the aircraft. All that other stuff is GFE or provided by sub-contractors. Funnily enough this stuff doesn't come for free...
Funny how we all got pooh-poohed for saying these costs would apply to either aircraft, but it seems as if EADS only wants to compare apples and oranges, as most on this blog want to do seemingly as well.
PS, remember when you were all going ballistic over the "price" difference between C-27J and C-295 only a couple of weeks ago?
How does that look now with a unit cost of $32m per aircraft?
Don't waste your breath Bonza.
Cue overused, out of place, invalid catchphrase.
"Defend the indefensible"
"Just so failed"
"Mistake jet"
"Total indifference to what is real"
"PS, remember when you were all going ballistic over the "price" difference between C-27J and C-295 only a couple of weeks ago?"
As well Bonza, that's not how business is done here.
"The F-35 will never fly at night"
"The F-35 will never fly with external stores"
"The F-35 will only ever be flown by test pilots"
Time marches on. Only the catchphrases change.
Lieutenant Colonel Bonza/AD .
Who went ballistic over the prices,regarding C295 and C27J not me.Neither is a replacement for the Caribou.Why tell lies.
The costs for the C27J are crap, as you know.
I believe we are capable of sorting out costs(capital expenditure/setup/operating costs), as most of us work in private enterprise, and can smell incompetence/stupdity from a mile away.
I take great comfort knowing that the Coalition will be taking serious action regarding DMO when they accede to power next year.
Tony Abbot, in the reply to the Budget speech, and Joe Hockey on the Insiders, both signalled the demise/curtailment of DMO.
In the mean time, suggest that if your are honest that you actually look at what is published critically, instead of salivating over everything Defence and DMO publish.
They have hardly got anything correct in the last ten years have they? What makes you think anything will change? Do you really want me to list the failures once again?
Sorry forgot to add, you are defending the indefensible.
Regards
Im sorry Bonza and Flasheart but you are both arguing patent bullshit and we all know it.
Bonza if your argument for us to " just wait till the annual reports come out and find where that expenditure goes" had any basis in credibility then I wouldn't have a problem. But the simple fact is every year we see the expenditure table (on many projects) and it clearly shows us that they have spent dollars within that year on sustainment of programs that clearly were not within the original purchase statements. It is almost intellectually insulting for you to suggest that close to 1.08 billion dollars can simply be explained by expenditure on EWSP, manuals, training, etc and initial set up. In effect they are account wise double dipping. First they announce the initial expenditure then they show annual accounts of expenditure each year after. If this is not the case then they are incompetent at clearly reporting the fact and getting that understood within the public sector. And even if it were the case, I would still question an annual averaged airframe expenditure of basically 1/3 of the cost of a new airframe per year. If that was the case in the commercial sector you would be bankrupt within 12 months. This cost does not include fuel or various incidental items that are not covered in a purchase and basic sustainment agreement. This is just the purchase of the airframe, setup at the beginning and basic servicing/overhaul and an agreed annual parts replacement (over and above any warrantable items costs which are born by the manufacturer) It is NOT an agreement to look after the fleet in a turnkey agreement for 10+ years, and if it were then again, it hasn't been explained or properly sold as such. Ten million per year, per airframe for a medium sized turboprop is way over the top regardless of some specialised equipment and they need to prove to us as the people footing the bill that we are not being ripped off or funds being syphoned off to other projects. And for you two to defend this reasonable questioning and objection brands you as either naive, arrogant or working for somebody who has something to gain from these schemes.
Bullshit? What's bullshit exactly?
All you are missing knowledge-wise about this acquisition is the full scope of what is being acquired, the scope of the work to bring it to FOC, the length of time the support is in place for, the exact contract prices and the period of time over which this budget is meant to cover?
But you do "know" it's over-priced? Give me a break...
You Perplexed et all know NOTHING about this beyond the DSCA announcement and the Defmin statements.
Apparently defence aren't even competent enough to run an FMS acquisition now, despite all the evidence to the contrary... Get over yourselves.
Everyone is stupid apart from LT Col Bonza/AD
Now I understand.Thanks.
Also,now I do not have to repeat the failures as Eric has done so on his latest blog.
He has left a couple out.
Defend the Indefensible.
Bonza asks, "What's bullshit exactly?"
Well, according to Emeritus Professor of Philosophy Harry G Frankfurt over at Princeton University, bullshit is "a total indifference to what is real".
There are far too many examples of this and the resulting behaviours in defence acquisitions and in defence governance, both in Australia as well as in Departments and Ministries of Defence of other western nations.
http://www.ausairpower.net/APA-NOTAM-190209-1.html
For example, the bullshit about the JSF O&S costs being up to 50% less than those of the F-16C and other aircraft it is intended to replace.
How could an aircraft that has about the same footprint as an F-16 but weighs over twice as much; with around twice the fuel load; over five times the avionics; more than ten times the software load; one really big, heavy, thirsty, very hot burning engine; high risk electrically powered flight controls; is a lot draggier than an F-16; and has the maintenance burdens of surface mounted and imbedded LO technologies possibly cost less than an F-16C to operate and support?
Then there is all that stuff about affordability. For example:
http://www.ausairpower.net/APA-NOTAM-170710-2.html
And let's not forget that huge pile of bovine by product about the JSF being "a truly 5th generation fighter".
http://www.ausairpower.net/APA-NOTAM-081109-1.html
Now that you have the definition, Bonza, how many other examples can you find?
Just like bullshit, simply claiming something is bullshit doesn't make it so. That's what is known in polite society as an unsupported assertion.
So, make sure to support what you claim to be bullshit with data and facts.
On that basis, have at it and let's see how good your bullshit detector really is.
..
Cue overused, out of place, invalid catchphrase.
"Defend the indefensible" "Just so failed" "Mistake jet" "Total indifference to what is real"
------
Classic!
- Alert 1
Alert 1, what a response. Classic.
No facts or figures.
Quote:
Defend the indefensible"
"Just so failed"
"Mistake jet"
"Total indifference to what is real"
Why bother? You're tone deaf and in love with stuff that won't work. Anyone who thinks the F-111 is viable in any form other than a target drone is deluded. Not casting my pearls after swine...
Tone-deaf is someone that wants to extend life of legacy Hornets out to 2020-21 and thinks the F-35 is a viable weapons system.
Has it ever crossed the minds of you financial speculators' that costs may be covered by commercial privacy? If you want to know the costs, write to the suppliers yourself? Good luck!
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