Arctic/Offshore Patrol Ship AOPS

[Monsoon]

The thing is, if this is a national asset then it should be more broadly funded (ie funded with HRDC labour grants, IRAP grants, Industry Canada grants, DFAIT grants for export assistance). That would put the Canadian yards on par with the Euro yards.

The RCN would then get the vessels at production cost (just like the F-35s we're supposed to get) with the yards and the government carrying the overhead costs.

The risk I see with that plan is the one that happened in Norway (can't find the link to this story now): the $400M subsidy was paid every year, but the Coast Guard's shipbuilding plan for Svalbard was delayed from 1994 to 2002 due to "lack of funds". Once the politicians get an industrial subsidy gravy boat set up, priorities for little things like defence fall to the wayside. By lumping the subsidy funds in with ship acquisition, the government is making sure that the subsidy expires if the shipbuilding stops.

The other way of looking at it is that the subsidy is intended to enhance the yards' ability to provide Navy- and Coast Guard-specific support (there is a lot that we do differently from industry). If that's the case then it makes sense to see the money budgeted under National Defence and DFO, rather than Industry.

 

[Kirkhill]

The problem we end up dancing around is maintaining the long term viability of the yards.

Yards that can build commercial and naval vessels have two potential income streams.  Currently our yards have neither stream.  The Euros have both streams.  The issue is with how the subsidies are managed.  Subsidies to yards end up subsidizing commercial shipbuilding which contravenes WTO requirements.  Subsidies for strategic assets, like naval shipbuilding are exempt from such rules, but if a "naval" yard competes for and wins a "commercial" contract it can be challenged, as I understand it.

Accordingly the issue becomes one of managing the subsidies and ensuring that the subsidies are directed against the project.  Fair enough. That will inevitably drive up the cost to the taxpayer of the project.  If that is where we are with the AOPS and NSPS projects then I am good with that.  Essentially we are covering not just the cost of building vessels but building graving yards and dry docks as well.  Those costs will become sunk costs (sorry about talking about sinking in a shipbuilding discussion ).  Ultimately the cost of those yards and docks will disappear as more ships are built.  Just as comparable costs (tools, hangars and jigs) will disappear over the life of the F35.

Once those yards are built then the shipyards will be better positioned to compete on the commercial market.

Another interesting aspect to this is there seems to be a tendency to have bare bones hulls built in low wage environments and then have the hulls delivered to national yards for fitting out.  The optics of this can be a bit difficult as the public sees the hull as the ship even though the majority of the costs will come during the fitting out process.

The Dutch get their hulls built on the Black Sea (in Romania), the Danes have had theirs built on the Baltic (Poland) and the Aussies on the Atlantic (Spain).  All three countries returned their hulls to national yards for machinery, hotel and weapons.

I guess I would just like to see some more detail in the accounting on the NSPS - and less wailing and gnashing of teeth about not being able to afford hulls.  Hulls are cheap.  It is the stuff you guys want to pack into them that costs money.  Maybe if you spread that wealth a bit, and invested less in each hull you could afford to put more of them in the water.   

And I still prefer to look out on the horizon and see the lights of another ship than feel all alone on the briny.  As I've said before: the best form of compartmentalization going as far as I am concerned.

 

[Monsoon]

The problem we end up dancing around is maintaining the long term viability of the yards.

Yards that can build commercial and naval vessels have two potential income streams.  Currently our yards have neither stream. 

If the two streams you're talking about are civilian and military business, both Seaspan and Irving have been doing quite well on the civilian front. In the case of Irving, they're having to add a dry dock to their capacity to support the new military business: a big up-front cost for them to swallow on the infirm commitment of a government's word.

Another interesting aspect to this is there seems to be a tendency to have bare bones hulls built in low wage environments and then have the hulls delivered to national yards for fitting out.  The optics of this can be a bit difficult as the public sees the hull as the ship even though the majority of the costs will come during the fitting out process.

The Dutch get their hulls built on the Black Sea (in Romania), the Danes have had theirs built on the Baltic (Poland) and the Aussies on the Atlantic (Spain).  All three countries returned their hulls to national yards for machinery, hotel and weapons.

Not sure how much saving this would yield. The hull component of the overall project cost is pretty marginal, and is itself 80% driven by the price of steel. I don't think you'd end up saving much by outsourcing hull construction to a lower-wage environment.

 

[Kirkhill]

If the two streams you're talking about are civilian and military business, both Seaspan and Irving have been doing quite well on the civilian front. In the case of Irving, they're having to add a dry dock to their capacity to support the new military business: a big up-front cost for them to swallow on the infirm commitment of a government's word.
Not sure how much saving this would yield. The hull component of the overall project cost is pretty marginal, and is itself 80% driven by the price of steel. I don't think you'd end up saving much by outsourcing hull construction to a lower-wage environment.

Agreed throughout.

 

[Navy_Pete]

Numerous news releases about the project team for AOPs include a design review by Lloyds.  No reason to do that if AOPs wasn't going to be built to the civilian standards for an icebreaker.  However, still a lot more to the hull and structure then the typical commercial work.  The big cost saving for going to somewhere with cheaper labour is that the bulk of the costs for putting the hull together is that it is all very labour intensive.  The number of hours for specilist welders, journeymen, testing etc are going to be insane, as this isn't something running through an assembly line with robots.

http://www.stxmarine.net/headlines.html (near the bottom)

Wrt the two yards, Seaspan does far more commercial business; Irving does do some commercial work but not the same scale (cruise ships, tankers etc).  Also, believe the new drydock was funded by a loan by the provincial govt to the tune of about 300 million.

http://thechronicleherald.ca/novascotia/1006956-ns-offer-to-irving-shipyard-dwarfed-bc-bid

So in addition to the subsidies from the program, there is also the provincial funding.  All that to say it gets extremely complicated trying to figure out what the real costs are.  At least with the NSPS you have a pretty reasonable idea as the two umbrellla contracts should capture the bulk of the costs for any of the ships that get built, with provincial subsidies aside.

Still going to be a huge sticker shock though; there are a lot of zeroes.  A significant portion of it will eventually wind up back in govt coffers though (business taxes, income taxes etc), and it is keeping a lot of people working, including all the suppliers spread across canada providing materiel and parts.  Think it's generally a good program, as long as its done properly, and doesn't get cut to irrelevance.  Huge difference between fixing ships and building ships, so if we are going to invest the money, may as well do it once then keep going rather then another boom/bust cycle.  The only other alternatives are to either buy foreign built ships (political suicide) or get rid of the navy all together.

In the end AOPs may end up costing more then comparable ships, as I think a lot of costs are going to be directly related to building up the capability/experience, but that should mean we get a good value/product with the CSC, even if I may be retired by the time they hit the water.

 

[AlexanderM]

The weapon systems are all standard, so the only place for huge cost overruns is in the hulls.

 

[SeaKingTacco]

The weapon systems are all standard, so the only place for huge cost overruns is in the hulls.

Believe me, it ain't anywhere close to being that easy.

integrating those weapons with your sensors on a command and control backbone that actually works will kill you (budget-wise) every time.  "Plug and play" sounds good on PowerPoint and in the shiny sales brochure.  Dollars to donuts says that the real world is different.

 

[AlexanderM]

Believe me, it ain't anywhere close to being that easy.

integrating those weapons with your sensors on a command and control backbone that actually works will kill you (budget-wise) every time.  "Plug and play" sounds good on PowerPoint and in the shiny sales brochure.  Dollars to donuts says that the real world is different.

These are the same systems already working on multiple existing warships, no need to re-invent a thing.

 

[NavyShooter]

Let's take a micro-sample of "integration" issues.

Let's look at a Pre-FELEX Halifax Class warship:

Take an American Long Range Search Radar (SPS-49) and tie it into a computer system that hands taget info over to a Saab Sea Giraffe 150 Radar, which then ties into Signaal's STIR fire Control radars, which pass information to a Swedish Bofors 57mm gun, and Sea Sparrow Missiles...with Canadian Electronic Warfare systems....

So, we have equipment from 5 different nations, multiple different manufacturers, all with potential proprietary software interfaces, possibly different operating systems, etc etc...

Getting systems to the point of full integration is probably the biggest hurdle....but, that's just my personal thoughts.

NS

 

[AlexanderM]

We don't try to re-invent the wheel.  We look at what is currently working on existing warships, pick the best and go with that configuration.  We already are partners on APAR, have been for years.  If we bought into the current upgrades being done on Smart-L we could likely be a partner there also.  Thales will know about integration, we select the systems that are already known to work the best together. 

 

[SeaKingTacco]

These are the same systems already working on multiple existing warships, no need to re-invent a thing.

I'm sorry, but your experience on these type of systems is precisely, what?

I'm going with what Navy Shooter said?

 

[AlexanderM]

I'm sorry, but your experience on these type of systems is precisely, what?

I'm going with what Navy Shooter said?

These systems are up and running on multiple warships, that's the experience which is relevant.

 

[Edward Campbell]

These systems are up and running on multiple warships, that's the experience which is relevant.

Yes, but which ships have integrated the weapon and control systems from four or five different countries ~ and what did it cost? (See NavyShooter's expert comment.)

We know how difficult and expensive it was on existing HMC Ships. What makes you think doing it again, on a new ship, will be less complex and less expensive?

 

[Kirkhill]

Alex,

Integration will be the difficult part.

The hull is a building.  That is all.  A floating, mobile building but a building nonetheless.

What you want to do in that building makes all the difference in the world.  And how you want to do it makes greater differences.

It is pricey enough if you get L-M or GD to build you a complete boat (take the LCS for example) using their proprietary systems.

But if, as Navy Shooter, SKT and ERC suggest, they end up using Thales, Atlas, L-M, GD and various Canadian national suppliers, amongst others, and they want to get all the pieces talking to each other on the bridge, in the CIC and in the engine room then that requires some effort.  Establishing a common communications protocol, compatible PLC and SCADA hardware and then writing the code to make it all march in time with each other, is a lengthy process.

Bolting pieces onto the ship is the easy part.  Connecting them to system (Plug) is harder.  Getting them to work together (Play) requires many hours (read PYs) of time to write the code and get it to a beta form.  And even then you will be sorting out glitches as long as the hulls are in the water.

I do understand that there are costs involved in building these vessels - as much as most, or indeed anyone does.

I also understand that there are complexities in pricing due to facilities and subsidies and ........

My concern, the one I share with you, is that Canadians are left with the impression that their costs are exceptional when compared to the rest of the world - to be honest I don't know if they are or not.  And I consider myself better informed on the subject than your average taxpayer.

A good start would be a better line item accounting of projected costs.

 

[AlexanderM]

Yes, but which ships have integrated the weapon and control systems from four or five different countries ~ and what did it cost? (See NavyShooter's expert comment.)

We know how difficult and expensive it was on existing HMC Ships. What makes you think doing it again, on a new ship, will be less complex and less expensive?

At this point the experience with the pre-FELIX Halifax Class is relevant then more than now, let's try to keep our heads in the present.  At present Thales and BAE are present in multiple countries and we are no longer looking at integration from 4 or 5 different countries, because it is all Thales or all BAE or all someone else.  We have been partners in Thales APAR for years, it is the same APAR system used by the Germans, the Dutch and the Dannish.  If we were to invest in the Smart-L upgrades, for which I suspect the money would be greatly appreciated, we would likely be partners there also, and those two systems are already working very well together, there is no need for us to change anything. 

We simply find out from Thales which systems are presently working best, or will be working best by the time we will be ready for them, we then pay any license fees required, and we proceed.  You seem to think we are starting from scratch here, which is not the case.  Rather, we are taking existing systems and puting them on new hulls.  In a way, the more time that goes by here actually benefits us, because it gives these other countries more time to streamline their current systems and we then get to see what works the best, and then go with that.  There is no need to re-invent.

 

[AlexanderM]

Alex,

Integration will be the difficult part.

The hull is a building.  That is all.  A floating, mobile building but a building nonetheless.

What you want to do in that building makes all the difference in the world.  And how you want to do it makes greater differences.

It is pricey enough if you get L-M or GD to build you a complete boat (take the LCS for example) using their proprietary systems.

But if, as Navy Shooter, SKT and ERC suggest, they end up using Thales, Atlas, L-M, GD and various Canadian national suppliers, amongst others, and they want to get all the pieces talking to each other on the bridge, in the CIC and in the engine room then that requires some effort.  Establishing a common communications protocol, compatible PLC and SCADA hardware and then writing the code to make it all march in time with each other, is a lengthy process.

Bolting pieces onto the ship is the easy part.  Connecting them to system (Plug) is harder.  Getting them to work together (Play) requires many hours (read PYs) of time to write the code and get it to a beta form.  And even then you will be sorting out glitches as long as the hulls are in the water.

I do understand that there are costs involved in building these vessels - as much as most, or indeed anyone does.

I also understand that there are complexities in pricing due to facilities and subsidies and ........

My concern, the one I share with you, is that Canadians are left with the impression that their costs are exceptional when compared to the rest of the world - to be honest I don't know if they are or not.  And I consider myself better informed on the subject than your average taxpayer.

A good start would be a better line item accounting of projected costs.

Kirkhill, these sytems already do exist, are in place, are communicating with each other, this work has already been done.

 

[Kirkhill]

With respect Alex:

I agree the systems exist.  I agree that they have been made to work.  Unfortunately everytime that they are recombined in a different configuration they have to be done over again.

Now some integrated systems do exist (like the Thales integrated mast the Dutch are using). That may reduce the number of hours necessary.  But the more cherry-picking the client indulges in (selecting each component for its optimal characteristics rather than just accepting adequate systems that will get the job done) then the more complex the integration becomes because the closer to first principles you have to go. 

If you want things done cheap and fast then you must give up on good..... if you define good as perfect.  If you define good as good enough then the cheapest, fastest way to get the job done is to buy exactly what somebody else is buying off of their production line with no options.

 

[AlexanderM]

With respect Alex:

I agree the systems exist.  I agree that they have been made to work.  Unfortunately everytime that they are recombined in a different configuration they have to be done over again.

Now some integrated systems do exist (like the Thales integrated mast the Dutch are using). That may reduce the number of hours necessary.  But the more cherry-picking the client indulges in (selecting each component for its optimal characteristics rather than just accepting adequate systems that will get the job done) then the more complex the integration becomes because the closer to first principles you have to go. 

If you want things done cheap and fast then you must give up on good..... if you define good as perfect.  If you define good as good enough then the cheapest, fastest way to get the job done is to buy exactly what somebody else is buying off of their production line with no options.

I would argue that your looking at this entirely the wrong way.

We are partners in APAR, have been for years.  That means that as APAR develops, we develop with it.  The key here is to partner up on these systems, so that as they develop, we go along for the ride.  we then get in on the stream at it's most advanced state, at the time we are ready for the systems, and then get updates as part of a partnership with other countries.  This makes things cheaper and more efficient for everyone.  What we do not do, is go our own way so that costs get out of control.

The Smart-L system can already detect Raptors at around 80km, and as the technology advences this range will increase.  The current upgrades to Smart-L will take the range from 400km to over 1000km, and I've heard as much as 2000km for ballistic missle detection.  The original range of APAR was 150km, but I understand will be or is 500km or better.  As these systems advance and develop we need only advance and develop with them.  It is a mistake to think that what we go with initially is final, as it isn't.

 

[AlexanderM]

Also, as these systems are constantly being developed and improved, there is no such thing as "perfect," as what is perfect today is only going to at best be adequate tomorrow.

 

[NavyShooter]

According to the mouse-pad I have in front of me (unclassified/Open Source) the following companies are involved in the Combat System Integrator:

Saab Systems (CEROS 200)
Saab Microwave (SG-180)
IBM Canada (DLPS)
Telephonics (IFF)
Elisra Electronic Systems (ESM)
Raytheon Anschuetz GmbH (X and S band Nav Radars)
Thales (Smart-S)

So there's 7 companies...some of them competitors.  In a VERY competitive global market for a LIMITED number of hulls/systems/etc. 

Sharing with Lockheed Martin, their proprietary interface data....another competitor for ALL of them.

Sure, there's countries out there that have bought some of these systems, and deployed them, and gotten them to work together. 

How much has it cost them?  I personally have no idea.

These upgrades are not like swapping out your car stereo, with a common form factor, and simple installation instructions.

I have done a *tiny* bit of playing with standard format computer languages....for example, G-code for a computerized Mill, or NMEA 0183 data in serial comms from shipboard navigation gear.  Every CNC system now uses G-codes....they all speak the same language, and they all run the same way.

Proprietary sensor systems from different manufacturers will probably need converters of some sort built into them, or their interfaces, so that they're all talking the same language.  It'd be like trying to get my shipboard GPS to send position updates to my CNC mill, converting the NMEA 0183 to G-codes....Sound like fun?  Do-able...time consuming...and probably expensive.

I have NOT yet receieved any detailed info on the new systems (this summer I hope!) but knowing how many major software revisions it's taken to get our pre-FELEX ships up to their current status, well, I'm wondering how long it'll take to get the new ships going, and how many revisions.

NS