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Canadian CAMAA & the 'Shut-out' BC-17X

Gobsmacked

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Globesmasher said:
It wasn't single source.
It did go out to competitive tender on MERX.

Antonov lost because the couldn't satisfy certain requirements.
Illyshin lost for the same reason.
Airbus lost because they couldn't deliver on time and meet the delivery schedule we stipulated in the SOR etc ..
A private company's bid lost because it was basically ridiculous (not for this thread).
Boeing won.
Simple.  Period.  Dot.

Hi Globesmasher,

Been cursorily following the discussion and I saw you mentioned something on Feb 1 that was not followed up on.
I tried a PM, but that darned function never seems to work for me when I try sending a member a message - it can't find them.

A private company's bid lost because it was basically ridiculous (not for this thread).
Boeing won.
Simple.  Period.  Dot.


Was that private company's bid the Skylink bid mentioned in a couple of news articles?
Although, an ACAN is never really a 'competitive tender' as the winner is predetermined as 'the only company that met/meets the requirements'.
I think that is something along the lines of what the Merx ACAN notice stated per CASR link.

Gob
 

Globesmasher

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Gobsmacked said:
Was that private company's bid the Skylink bid mentioned in a couple of news articles?

Gob

I believe it was.
Although I was not privie to the details on the "company's" name, I got the rundown from friends in the CAS DAR office.

Essentially the plan that the "company" was offering was one where they were going to approach Boeing themselves and buy 4 or 5 C-17s.  They would then  turn around and "sell" or "contract" their airlift services out to the CF or whoever would be willing to buy the service they had to offer.

Essentially all that we would be doing is changing our civil outsourced airlift contract for Silk Airways (using the Ilyushin and Antonov) to another company using Globemasters.  Where the hell is the new capability?  These guys think we're going to hand $3.4 billion over to them so that they can turn around and provide us with an outsourced airlift capability??  It was ludicrous.

And at the time they hadn't even purchased the aircraft or even approached Boeing or the US government for approval to purchase the aircraft.  Even though Boeing is a civilian company, they are not at liberty to turn around and sell their military technology to just anybody in order to make a buck.  US Congress still has to approve it - they had to approve the Canadian Govt's plan to purchase 4 of the aircraft.  Believe it or not, there were some Senators opposed to the plan - albeit a minority.  I doubt they would allow some civilian company to buy these things who could then turn around and make the technical specs available everywhere.  Even a transport aircraft purchase must go through FMS (Foreign Military Sales) approval with the US Govt.

It was just a laughable business plan that this "company" offered .... it was doomed to failure ... and I don't even have an MBA or anything to realize that it couldn't/wouldn't work and it would have been a waste of money for "us", the CF/DND.
 

Gobsmacked

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Globesmasher said:
Although I was not privie to the details on the "company's" name, I got the rundown from friends in the CAS DAR office.

Essentially the plan that the "company" was offering was one where they were going to approach Boeing themselves and buy 4 or 5 C-17s.  They would then  turn around and "sell" or "contract" their airlift services out to the CF or whoever would be willing to buy the service they had to offer.

Essentially all that we would be doing is changing our civil outsourced airlift contract for Silk Airways (using the Ilyushin and Antonov) to another company using Globemasters.  Where the hell is the new capability?  These guys think we're going to hand $3.4 billion over to them so that they can turn around and provide us with an outsourced airlift capability??  It was ludicrous.

And at the time they hadn't even purchased the aircraft or even approached Boeing or the US government for approval to purchase the aircraft.  Even though Boeing is a civilian company, they are not at liberty to turn around and sell their military technology to just anybody in order to make a buck.  US Congress still has to approve it - they had to approve the Canadian Govt's plan to purchase 4 of the aircraft.  Believe it or not, there were some Senators opposed to the plan - albeit a minority.  I doubt they would allow some civilian company to buy these things who could then turn around and make the technical specs available everywhere.  Even a transport aircraft purchase must go through FMS (Foreign Military Sales) approval with the US Govt.

It was just a laughable business plan that this "company" offered .... it was doomed to failure ... and I don't even have an MBA or anything to realize that it couldn't/wouldn't work and it would have been a waste of money for "us", the CF/DND.

Guess that confirms it, looks like DND's Public Relations 'Misinformation' machine is hard at work putting a 'SPIN' on what was actually proposed.
And, while I fully respect your Informed Opinions on the C-17, since you have reversed your previous view of (not for this thread), that opens the can of worms for me to properly address the subject and request that next time you be sure of your information before you (i'm assuming inadvertently) Publicly Diss a Valid and Fully Compliant proposal  :tsktsk:
- without knowing what it actually comprised or what truly occurred.
I'll correct your inaccuracies/misperceptions after I provide the True Skinny.

THE TRUE SKINNY (- per Press Release #4 distributed 20 Feb 2007)

As previously indicated to DND/PWGSC, CANADIAN GLOBEMASTER would undertake (using 4x pre-production/LRIP BC-17s) and fund a majority of the (US$500 Million) FAA/Transport Canada certification process for the BC-17X/XM within the purview of a multi-aircraft BC-17X/XM purchase - due to the Outstanding potential air cargo market opportunity that would present itself to the initial operator of the Only non-Eastern block civilian outsize/oversize airlifter.

Canadian Globemaster's ACP-S/ACP-Tac Canadian CAMAA submission differs from original CAMAA in that we would provide DND with 30 yrs guaranteed 100% availability for a one-time up-Front Fee less-than cost of 1 C-17 (helps with start-up costs), majority of ACP-S/ACP-Tac funding would still go to Boeing/LM - we think that is a heck of a deal!
No guaranteed annual subsidies or admin fees (as with NATO SALIS) required, especially considering that DND has no equivalent to US CRAF civil fleet.
Of Note, not one US company is willing to pay the US$500M BC-17X R&D/FAA Cert premium, otherwise it would already be in production as the current BC-17X AO already allows US Commercial operation.

An additional side benefit to GoC would be that the Cdn$1 Billion+ year-round access road to Yellowknife that the Premier of the Gov't NWT has called for would not be required - as CANADIAN GLOBEMASTER could handle bulk shipment of any supplies unable to traverse the winter ice road (with past spring 2006 breakup resulting in a scramble to charter Russian IL-76s to transport the millions of tons of stranded supplies), with help from First Air's sole LC-130 Hercules for smaller loads, as BBE vp Stuart Russell noted at a Canada North conference last year - the BC-17X is "a capability urgently needed in Canada's north".

Summary of Canadian Globemaster's Fully Compliant  :brickwall:
BC-17XM Canadian CAMAA proposal   :cdn:

Ironically, Canadian Globemaster’s Canadian CAMAA proposal would provide 100% more integral-Canadian strategic airlift capability  –  Double the current ACP-S project deliverability , and 33% more integral-Canadian strategic airlift capability than the Liberal-cancelled FSA (Future Strategic Airlift) project which had aimed to acquire 6x C-17s, truly a real 'Canada First' capability.

Canadian Globemaster would have had 4 Canadian-owned BC-17X/XM, redeployed from our proposed home base of Edmonton International Airport - conveniently near 1CMBG at Edmonton Garrison,  100% guaranteed available for standby at CFB Trenton for 30 years per FSA SOR (Statement of Operational Requirement) Charter guarantee requirement terms, to supplement DND airlift assets at guaranteed pre-arranged rates (allowing <5% profit vs. current An-124 monopoly highway robbery rates), plus specified at-cost haulage - without any preset yearly Min/Max limit on flying hours
DND would also have acquired 4 FAA-certified 'militarized' BC-17XM (‘C-17 Lite’) directly from Boeing vs. 4 more expensive all-up C-17s.

The Boeing BC-17XM is a lower-cost version of  'THE EXACT SAME AIRCRAFT'  that DND & PWGSC propose to acquire under the ACAN.

Canadian Globemaster also proposed GoC leasing 2 C-17 from USAF for 2 years (from 18 thru 42 months), thus providing and maintaining an IOC, until receipt of all 4 BC-17XM before/by the 48-month final delivery deadline.  This handily covers the less-than 40-month BC-17XM certification period, with two extra months of overlap to cover delivery of the initial 2 BC-17XM to DND.
Therefore, 8 BC-17XM/X available by 48 months vs. just 4 C-17.

Additionally, as noted in the integral ACP-Tac (sub-proposal) portion of our proposal that would have to provided an expedited ACP-Tac entry into CF ownership, Canadian CAMAA would have seen DND acquire a C-130J IOC by 2010 – before scheduled C-130J deliveries from Lockheed Martin were to even begin!  Especially pertinent, considering DND's ACP-S SOR assertion that The requirement for this equipment is Urgent!' 

The [Optional] 'CA/Netherlands Equipment Exchange' portion of Canadian Globemaster's Canadian CAMAA proposal would also have been very beneficial to the Army:salute:
The fully-costed Exchange, which would cost DND less-than Cdn$490 Million (approx US$3XXM value (2006 CY)) vs. 'Cdn$825M [$BY] for 66x MGS' (per latest 8 Dec 05 'ITAR Sensitive [not for Public Disclosure]' DND 'MAJOR CAPITAL PROJECT #731 MGS' briefing document for MND), would have provided:
70 Leopard 2A6 Main Battle Tanks [a Cdn$700M Savings alone], 22 Leopard 2 ARV/AEV/AVLB support vehicles; 5 AH-64D Apache attack helicopters (to escort CH-47F Chinooks); and 18 PzH2000 turret systems (w\ 50km range when using Excalibur PGM).
[As to the Army related offset portions of our SoC proposal (sec's 2 thru 14), the CLS, LGen Andrew B. Leslie, had noted: "There are some interesting ideas in what you have proposed."]

Army related Offsets lost by ditching Canadian CAMAA
CANADIAN GLOBEMASTER was willing to rapidly airlift one Troop of Leo 2A6M MBTs overseas in it's commercial BC-17Xs, on a purely 'cost recovery basis in perpetuity', per year;
• If the GoC had accepted our proposal, CANADIAN GLOBEMASTER would have covered the complete acquisition cost of a Leopard 2A6 Driver Training Simulator by 2012;
• If GoC had accepted the Proposed 'Cost Reduced' Alternative RegF/Militia M113LE Distribution, and suggested 14 AES Armored Vehicle FG ORBAT for 1CER - with its' associated Assault-Pioneer Troops of RegF/Militia Assault-Pioneers proposal, CANADIAN GLOBEMASTER would have further reduced the Cdn$32.3M cost of the 41 additional M113LE upgrades (from unused kits in stock) by providing a Cdn$21M reduction in it's Canadian CAMAA proposal cost;
• If DND and GoC had accepted the 'BASIC' Proposed FORCE STRUCTURE / EQUIPMENT PROPOSALS put forth, CANADIAN GLOBEMASTER  would have completely covered the minimal TOTAL COST of 'Phase 2/3' Combat Support Vehicle [CSV] conversion of the 13x Proposed LAV-II Bison CSV - to support the six LAV-II Coyote Surv squadrons (RCD & 12eRBC), thus enabling a logistically compatible LAV-II-based fleet in the Surv Sqns with a fully protected CSS A-line echelon;
• In return for set-up of a MMEV DFS (Missile) Regt - as recommended by DND’s MMEV-ADATS WG – thus implementing the 'Basic' sustainable MMEV DFS (Missile) Org (with minimal/no changes), vs. under strength 128 MMEV Bty within LdSH-RC, CANADIAN GLOBEMASTER was willing to rapidly airlift ADATS Troops overseas/domestically in it's commercial BC-17Xs, on a purely 'cost recovery basis in perpetuity';
• Had GoC accepted our proposal, CANADIAN GLOBEMASTER would have rapidly airlifted, if/when operational requirements dictate, one proposed GDF-005 MMEV-AD/DFS (Multi-Mission Effect Vehicle - Air Defence / Direct Fire Support) Troop - comprising:    4x GDF-005 LAV-III.5 MMEV-AD/DFS and 1x Skyguard MkII (3-D) w\HLVW or LAV-III.5 w\  X-Tar (3-D) - overseas in it's commercial BC-17Xs, on a purely 'cost recovery basis in perpetuity', per year;
• Had GoC accepted the Proposed 'Cost Reduced' Alternative RegF/Militia M113LE Distribution, and FG ORBAT for 4 MMEV DFS(Missile) Regt - with its' Single GBAD Troop and 5x DF ADATS Tps proposal, CANADIAN GLOBEMASTER would have reduced the cost of the 148 additional LAV-III.5(8x8) & LAV-III(10x10) necessary by providing a Cdn$XM reduction in it's Canadian CAMAA proposal cost.
END.


I'll let you review the full Press Release, available upon request to anyone who wants a copy (just let me know what e-mail address to Bcc it to - all e-address's will remain strictly confidential), to obtain an accurate 1st hand idea of what was actually proposed.

Inaccuracies/Misperceptions

1. hand $3.4 billion over to them so that they can turn around and provide us with an outsourced airlift capability? - We wish!
we would provide DND with 30 yrs guaranteed 100% availability for a one-time up-Front Fee less-than cost of 1 C-17 (helps with start-up costs), majority of ACP-S/ACP-Tac funding would still go to Boeing/LM - we think that is a heck of a deal!

2. I doubt they would allow some civilian company to buy these things who could then turn around and make the technical specs available everywhere.
the current BC-17X AO (Advisory Opinion) already allows US Commercial ownership/operation.

3. And at the time they hadn't even purchased the aircraft or even approached Boeing or the US government for approval to purchase the aircraft.
The response to our BC-17XM non-compliance Formal Contestation demonstrates they, just don’t want to get it and, can’t seem to grasp that we have continually been upfront in requesting DND assistance (since submission of our original Formal Unsolicited Proposal in 2003) – a show stopper - in obtaining a Modified DoS (Dept of State) ODTC (Office of Defence Trade Controls) AO (Advisory Opinion) – original AO attached to our Formal Contestation - with Modifed AO allowing Canadian ‘militarized’ BC-17XM and BC-17X operation.
We originally first approached Boeing back in 2002/03 - when we talked with the BC-17X Team Leads -and have have advised them of our progress (or lack of considering previous Liberal FSA reluctance) since then.  We have also conferred extensively with both the C-17 SPO CAMAA head and his Pentagon-based SAF/AQX CAMAA superior Col. Hunt - until CAMAA cancellation, since CAMAA cancellation by SAF (Secretary of the Air Force) in late-2004 both have been reassigned to other duties.

4. Even a transport aircraft purchase must go through FMS (Foreign Military Sales) approval with the US Govt.
There is no relationship/agreement implied or expressed, at this point, between Boeing and CANADIAN GLOBEMASTER (– unlike Military customers such as DND as ITARS restrictions prevent this until a Modified BC-17XM/X AO obtained).
CANADIAN GLOBEMASTER would undertake and fund a majority of the FAA/Transport Canada certification process for the BC-17X/XM within the purview of a multi-aircraft BC-17X/XM purchase.
In return, DND would provide assistance to CANADIAN GLOBEMASTER in obtaining a modified BC-17X AO from US DoS ODTC to comply with ITARS restrictions.
Boeing's BC-17X Lead had advised "The company sees Canada as a C-17 opportunity, . . . and, much to my chagrin, does not want to 'muddy the water' with the BC-17X, which is not yet a committed program.  If your proposal does get serious consideration and the Canadian government is willing to pursue the foreign ownership/operation issue for the BC-17X with the US State Department, the company's position would likely change.  Until that time there is little that I can do to support you."  ::)

5. US Congress still has to approve it - they had to approve the Canadian Govt's plan to purchase 4 of the aircraft.
Although the associated F117-PW-100 engine purchase WAS posted via DSCA, via a 36(b) FMS (Foreign Military Sale) notification, the C-17 sale is a direct commercial sale to facilitate the 100% IRB offsets required from Boeing.  A 36(c&d) Direct Commercial Sales (DCS) notification, such as the 21 Sept 2006 DCS notice for the UK purchase of a 5th C17 noted on the U.S. DoS Directorate of Defense Trade Controls website (cases notified to the 109th Congress) through DSCA FMS-link [http://pmddtc.state.gov/congnotify_intro.htm]  is required by ITARS lawCuriously, No such 36(c&d) DCS notification notice has yet been posted for the Canadian C-17 purchase (now weeks past 2 Feb contract signing) – which is not covered by Canadian exemptions, and therefore currently Illegal!  :eek:

6. A private company's bid lost because it was basically ridiculous (not for this thread).
It was just a laughable business plan that this "company" offered .... it was doomed to failure ... and I don't even have an MBA or anything to realize that it couldn't/wouldn't work and it would have been a waste of money for "us", the CF/DND.
After perusing the Press Release, or even just whats noted above, tell me you still think that!  :mad:
Especially considering the Canadian CAMAA proposal would provide 100% more integral-Canadian strategic airlift capability  –  Double the current ACP-S project deliverability - at no additional long-term cost to DND for the 4 tails owned by Canadian Globemaster.

As a member of Her Majesty's forces it is improper to make such I got the rundown from friends in the CAS DAR office without knowing all the facts as that indirectly represents DND's own views/opinions.

Regards,
          Gob

PS: I will not be replying to any 'ill-informed' comments as those who actually have objective opinions will be willing to peruse the Press Release first to find out the Full story

What we noted above does not even touch on how PWGSC/DND initially (UNJUSTIFIABLY) Failed a Fully Compliant BC-17XM SoC - a lower-cost version of  'THE EXACT SAME AIRCRAFT'  that DND & PWGSC propose to acquire under the ACAN, leading to Boeing (likely seeing the writing on the wall) then pulling their support for the BC-17X by late-Sept, which in turn Finally allowed the ACP-S PMO to reject our late-August 'Formal Contestation' - as they had been unable to before Boeings' notice.
 

Zoomie

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Gobsmacked said:
After perusing the Press Release, or even just whats noted above, tell me you still think that!  :mad:

Yup - still laughable.

By your logic - we might as well out-source the entire Canadian Forces to a 30 year contract.

Who would you have flying these expensive machines?  Would you follow how all other civilian defense contracts have transpired and have CF aircrew?  If not, would your aircrew be prepared and trained to the standard required for our needs? 

Would this company be prepared to take these BC-17s into combat or risky AORs (such as Kandahar)?

Civilian contracts are fine and dandy for aircrew training and other less risque projects.

 

Globesmasher

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I appear to have caused some personal offence.
That was not my intent – and for that I apologize.
I endeavour not to personally attack. And I may have done that inadvertently.  Again, my apologies.

There’s always more than one side to every story or issue.  Usually there are two, sometimes more.  It’s interesting though.  It strikes me as ironic that the side of the DND is typically painted as:

Gobsmacked said:
DND's Public Relations 'Misinformation' machine is hard at work putting a 'SPIN' on what was actually proposed.

And, the side provided by the entity/company/person who may possibly have been slighted or disgruntled is declared as:

Gobsmacked said:
I provide the True Skinny.

THE TRUE SKINNY (- per Press Release #4 distributed 20 Feb 2007)

Furthermore, I will continue to …

Gobsmacked said:
Publicly Diss a Valid and Fully Compliant proposal 

That is just my opinion.
Whether you personally agree with it or not.

I work to ensure that everyone in this country is guaranteed to free public speech, discussion and debate whether I happen to agree with it or not.  That is the beauty of what we live in .. the fun part of the internet … and one of the purposes of this forum – to debate and discuss.

Like I said at the outset … my apologies for any unintended personal offence I may have caused.  “That” was certainly not my purpose.

Like I have stated previously – I am not intimately involved in the bid or contract process.  I merely consult for DAR, PMO and others who ask my services.  I fly them I don’t buy them.  I don’t work for PWGSC.

However, that being said, my information comes from those who sit at the table in these contract negotiations. Any opinion I have to offer is personal and it comes from purely anecdotal experience that I have with those who are intimately involved.  So I guess I am one (or is it two?) degrees separated from the actual event.  I by no means wish to be any closer – this is already too close for me.

But the “true skinny” is very interesting: …

Gobsmacked said:
- due to the Outstanding potential air cargo market opportunity that would present itself to the initial operator of the Only non-Eastern block civilian outsize/oversize airlifter.

If there is such an outstanding market potential, then why hasn’t this company actually gone out and executed their business plan/idea/proposal?  Why do they sit and wait for a Govt contract to start up their private market “concept”.  Why are they not exploiting that market opportunity right now?  No private investors?  Nobody else think it is such a great plan?  Going to wait for Govt money instead to start this "plan" up?

Gobsmacked said:
for a one-time up-Front Fee less-than cost of 1 C-17 (helps with start-up costs), majority of ACP-S/ACP-Tac funding would still go to Boeing/LM - we think that is a heck of a deal!

Yes!!! That is a heck of a deal ….. for the “company”.  So, you want DND to use the ACP-S funds to go and purchase the aircraft from Boeing, then give you the balance in the form of a start-up cost??  That is an interesting way of proposing a business solution.

Gobsmacked said:
DND has no equivalent to US CRAF civil fleet.

True, DND does not – but do some research and you’ll see that DND has already used “contracted”, Canadian civil airlift to move troops over to the Persian Gulf in much the same way that the US Govt uses their CRAF.  Sometimes the CC150 can’t move all the troops in the rotations.  During peak times the DND contracts out to Canadian civilian airlines.

I wish we did have a CRAF – that would provide us with even more flexibility in addition to current capability.

Gobsmacked said:
Of Note, not one US company is willing to pay the US$500M BC-17X R&D/FAA Cert premium, otherwise it would already be in production as the current BC-17X AO already allows US Commercial operation.

This is what makes the proposal so “interesting”.  How does the “company” plan on buying these aircraft if nobody, not even themselves, is willing to pay this exorbitant fee?  The GoC can purchase the military version of the C-17 through FMS for approx $250 million each … yet your company thinks they can do better on their contract bid when they haven’t even gone out to buy the BC-17X AO yet for $500 million.

Here is another interesting titbit of math …. or something.  It says below that …

Gobsmacked said:
DND would also have acquired 4 FAA-certified 'militarized' BC-17XM (‘C-17 Lite’) directly from Boeing vs. 4 more expensive all-up C-17s.
The Boeing BC-17XM is a lower-cost version of  'THE EXACT SAME AIRCRAFT'  that DND & PWGSC propose to acquire under the ACAN.

How can you have a “militarized” BC-17XM that is different from the more expensive “all-up” C-17?  And yet the quote says that it is a low cost version of “exactly the same aircraft”.

So, which is it?
The BC-17X would be an FAA certified version of the C-17.
A “militarized” BC-17XM would be a re-militarized version of the BC-17X?
The “all-up” C-17?
Which is it?

You see, the C-17 IS a “militarized” aircraft.  What makes it so complex are the numerous layers of combat redundancies on various systems (quad redundancies in the flight controls for example).  That is the way it rolls off the assembly line.  The C-17s that DND will/have purchased are just that … C-17s.  They are not “de-militarized”.

Military aircraft are operated under “state sanction” so we don’t require FAA certification or TC certification to operate them .. However we do stay complaint in terms of navigation accuracy and avionics etc …… this is a step or technicality that we don’t have to worry about as a Govt body – but “Canadian Globemaster” does since it would be a civilian company.  You would not be able to operate the aircraft under “state sanction” so you would be asking for more money to pay for the FAA and then the TC certification.  Yes, you’ll need TC certification too if you want to licence and base your aircraft in Canada … at Edmonton Intl as you proposed.  Two civil certifications required.  Or would you only do FAA certification and stay as a US company?

So, “Canadian Globemaster” plans on  …. Eventually …. Buying 4 aircraft from Boeing (or I should say having DND use ACP-S money to buy the aircraft for them) … then have them turned into the civilian version of the BC-17X .. and then have them “militarized” in a “C-17 Lite” …. For a cost of $500 million whereas the GoC can purchase the aircraft outright from Boeing for half that cost.

It’s just not adding up.

Gobsmacked said:
the current BC-17X AO (Advisory Opinion) already allows US Commercial ownership/operation.

So where is it?
If so, why hasn’t Canadian Globemaster gone out and done this and stood up their company?

Gobsmacked said:
The response to our BC-17XM non-compliance Formal Contestation demonstrates they, just don’t want to get it and, can’t seem to grasp that we have continually been upfront in requesting DND assistance (since submission of our original Formal Unsolicited Proposal in 2003) – a show stopper - in obtaining a Modified DoS (Dept of State) ODTC (Office of Defence Trade Controls) AO (Advisory Opinion) – original AO attached to our Formal Contestation - with Modifed AO allowing Canadian ‘militarized’ BC-17XM and BC-17X operation.
We originally first approached Boeing back in 2002/03 - when we talked with the BC-17X Team Leads -and have have advised them of our progress (or lack of considering previous Liberal FSA reluctance) since then.  We have also conferred extensively with both the C-17 SPO CAMAA head and his Pentagon-based SAF/AQX CAMAA superior Col. Hunt - until CAMAA cancellation, since CAMAA cancellation by SAF (Secretary of the Air Force) in late-2004 both have been reassigned to other duties.

Ah ha!!  It’s all the government’s fault is it?

Gobsmacked said:
CANADIAN GLOBEMASTER would undertake and fund a majority of the FAA/Transport Canada certification process for the BC-17X/XM within the purview of a multi-aircraft BC-17X/XM purchase.
In return, DND would provide assistance to CANADIAN GLOBEMASTER in obtaining a modified BC-17X AO from US DoS ODTC to comply with ITARS restrictions.

So, If Cdn GM is so confident that the program cannot fail and is a true winner, get on and do it.

Gobsmacked said:
6. A private company's bid lost because it was basically ridiculous (not for this thread).
It was just a laughable business plan that this "company" offered .... it was doomed to failure ... and I don't even have an MBA or anything to realize that it couldn't/wouldn't work and it would have been a waste of money for "us", the CF/DND.
After perusing the Press Release, or even just whats noted above, tell me you still think that! 

Actually no, you are correct.
I no longer think it is laughable.
Poor choice of words.
I find it a poorly crafted business concept.
I think it is a shame.
I think it is sad.
I just shake my head now.

Truth be told your post has been enlightening.  I did only know half the story and I thought it was laughable.  Now I think I know a lot more of the story.  It was enlightening to see a glimpse of the other side of the coin.

Gobsmacked said:
As a member of Her Majesty's forces it is improper to make such I got the rundown from friends in the CAS DAR office without knowing all the facts as that indirectly represents DND's own views/opinions.

That’s your opinion.
You are entitled to it.
But my sources are the guys who got to witness what was going on in negotiations.  But I stand corrected ….. it sounds as if you were actually there.
I don’t represent DND’s opinion, directly or indirectly.
I represent my own opinion.

Gobsmacked said:
PS: I will not be replying to any 'ill-informed' comments as those who actually have objective opinions will be willing to peruse the Press Release first to find out the Full story. 

Please don’t.

However.  Had Canadian Globemaster (who believe that the airlift market in the western world indeed holds such lucrative potential as it purports) actually gone out and purchased some form of BC-17X and set up a successful company that was running and operating out of Edmonton Intl … or wherever …. then I may have an entirely different opinion (personal opinion of course - just to be clear).

If Canadian Globemaster was a successful business model that had a proven track record and they came to the negotiation table with the success record …. Well, then they would indeed been a real contender.

In fact, it would not even be an issue for discussion.  Since the eastern European companies provide the service at

Gobsmacked said:
“highway robbery prices”

then Canadian Globemaster would have won the civil cargo airlift contract many years ago and we probably wouldn’t be faced with an ACP-S issue at all.  We would see the 8 Cdn GM aircraft doing our contract airlifts right now instead of the Antonovs etc ...

Right now – the simple bid that Canadian Globemaster submitted doesn’t provide DND with any new capability.  It simply asks for capital project money from DND to set up a private company to provide a “service” to DND under the auspices of ASD – a service that is already provided by Silk air and other such eastern European companies.  Where is the “point” to this … other than it provides new aircraft instead of old ones.  It is still “out sourcing”.

The next time … my Defence/Geopolitical Analyst friend … that you want to buy a car come and see me.  I have a deal for you.

I want you to give me the money you plan on spending on a car … I’ll then go out and try to get approval to “modify” a “demodified” version of it .. and then I will sell you access to it for the next 30 years.  It'll take me at least 48 months and then some to get the vehicle certified ... in the mean time take the bus or something else.

Now, that’s a laughable plan if you ask me.
Like I said, I don’t buy them.
I just fly them.
I’m not even a great fan of Mr Fortier or PWGSC … you can take your issues up with them not with me.

If Canadian Globemaster feels it has been dealt an unfair hand in the process I am sure it will join the line behind EADs in an attempt to sue the Canadian government.  How is that going by the way?  ::)

By all means, please send me a copy of the press release at:
globesmasher@hotmail.com




 

observor 69

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Ah yes, Gobsmacked reminds me of that bright light you see in the eyes of newly minted MBA's.

I believe it is called "greed."

Thanks for the great reply Globesmasher, even if you don't have a MBA.  :D
 

Teddy Ruxpin

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I'm out of my lane here, and Gobsmacked post is incredibly difficult to read and digest, but I feel duty-bound to point out the following from an Army perspective:

Army related Offsets lost by ditching Canadian CAMAA
•   CANADIAN GLOBEMASTER was willing to rapidly airlift one Troop of Leo 2A6M MBTs overseas in it's commercial BC-17Xs, on a purely 'cost recovery basis in perpetuity', per year;

Against what requirement?  Why we would we be lifting a troop a year?  How does this benefit the Army?

•   If the GoC had accepted our proposal, CANADIAN GLOBEMASTER would have covered the complete acquisition cost of a Leopard 2A6 Driver Training Simulator by 2012;

A single simulator?  Hardly worth considering, bearing in mind the expense of the airlift contract.  How does this help?

•   If GoC had accepted the Proposed 'Cost Reduced' Alternative RegF/Militia M113LE Distribution, and suggested 14 AES Armored Vehicle FG ORBAT for 1CER - with its' associated Assault-Pioneer Troops of RegF/Militia Assault-Pioneers proposal, CANADIAN GLOBEMASTER would have further reduced the Cdn$32.3M cost of the 41 additional M113LE upgrades (from unused kits in stock) by providing a Cdn$21M reduction in it's Canadian CAMAA proposal cost;

Huh?  The Reserves are not getting M113s.  How is this connected with an airlift contract?  You've lost me.

•   If DND and GoC had accepted the 'BASIC' Proposed FORCE STRUCTURE / EQUIPMENT PROPOSALS put forth, CANADIAN GLOBEMASTER  would have completely covered the minimal TOTAL COST of 'Phase 2/3' Combat Support Vehicle [CSV] conversion of the 13x Proposed LAV-II Bison CSV - to support the six LAV-II Coyote Surv squadrons (RCD & 12eRBC), thus enabling a logistically compatible LAV-II-based fleet in the Surv Sqns with a fully protected CSS A-line echelon;

Again, this is nonsense and is apples and oranges.  What's a "LAV II"?  Are you telling us that - as part of it's airlift proposal - CANADIAN GLOBEMASTER had a complete Army restructure in mind?

•   In return for set-up of a MMEV DFS (Missile) Regt - as recommended by DND’s MMEV-ADATS WG – thus implementing the 'Basic' sustainable MMEV DFS (Missile) Org (with minimal/no changes), vs. under strength 128 MMEV Bty within LdSH-RC, CANADIAN GLOBEMASTER was willing to rapidly airlift ADATS Troops overseas/domestically in it's commercial BC-17Xs, on a purely 'cost recovery basis in perpetuity';

This vehicle does not and will not exist.  ADATS will only be retained in limited numbers - and we can ship them by rail for those few times we need to deploy them.

•   Had GoC accepted our proposal, CANADIAN GLOBEMASTER would have rapidly airlifted, if/when operational requirements dictate, one proposed GDF-005 MMEV-AD/DFS (Multi-Mission Effect Vehicle - Air Defence / Direct Fire Support) Troop - comprising:    4x GDF-005 LAV-III.5 MMEV-AD/DFS and 1x Skyguard MkII (3-D) w\HLVW or LAV-III.5 w\  X-Tar (3-D) - overseas in it's commercial BC-17Xs, on a purely 'cost recovery basis in perpetuity', per year;

Again...MMEV doesn't exist - nor does your troop.

•   Had GoC accepted the Proposed 'Cost Reduced' Alternative RegF/Militia M113LE Distribution, and FG ORBAT for 4 MMEV DFS(Missile) Regt - with its' Single GBAD Troop and 5x DF ADATS Tps proposal, CANADIAN GLOBEMASTER would have reduced the cost of the 148 additional LAV-III.5(8x8) & LAV-III(10x10) necessary by providing a Cdn$XM reduction in it's Canadian CAMAA proposal cost.
END.

What proposal?  Why would we do this?  Against what operational requirement?

Frankly, the whole thing sounds and looks like it was dreamed up by somebody with a Jane's book, a calculator and a couple of "bright ideas", not a multi-billion dollar organization.  I don't see a serious proposal presented by a real company with a proven track record.  Then again, maybe it's just me...   ::)
 

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Gents, personal attacks aren't on.  Foresnic discussion is not particularly useful either, particularly where not everyone has all the information available.

The contract has been signed, C-17's will make it to the ramp so this one appears to have run it's course.  PM a Mod if you feel there is something of value to add.


The Army.ca staff
 

Gobsmacked

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{NOTE:  Mods - Please add in posts http://Forums.Army.ca/forums/threads/54089/post-532444.html#msg532444
thru  http://Forums.Army.ca/forums/threads/54089/post-533524.html#msg533524
from the C-17 thread.  Then discard this note.

Per conduct guidelines, this is Not a 'posts made for the purpose of self-promotion',
but one made to correct inaccuracies and misleading information.}


I am taking up Globesmashers invitation to,
"Feel free to start a new thread on this issue in the forums as you wish.
It's your right as a forum member to initiate debate and discussion of your choosing within the forum ROEs."

And have therefore posted a majority of my comments sent to both him and Mike Bobbit (along with copy of PressRelease) in response to acerbic and uninformed comments made before the thread was locked - thus denying Canadian Globemaster a chance to rebut said comments.
And as As Good2Golf clearly agreed, "personal attacks aren't on", thus closing the thread.


I also agree "that everyone in this country is guaranteed to free public speech, discussion and debate whether I happen to agree with it or not."
While Globe was definitely entitled to his initial view that "A private company's bid lost because it was basically ridiculous (not for this thread).  Boeing won.  Simple.  Period.  Dot."
If his subsequent comments had been provided your via a PM - I would have been ok with that - I'm all for constitutionally guaranteed free speech based on known facts/data.

But, since Globe reversed his "(not for this thread)" Viewpoint,
What I DO Take Issue with is Publicly Painting an Inaccurate and Misleading Public Impression of what our Proposal consisted, that could potentially damage our Company's reputation/contestation chances,
by giving the Public Impression of an official DND viewpoint
of:
"I got the rundown from friends in the CAS DAR office.
Essentially the plan that the "company" was offering was
one where they were going to approach Boeing themselves and buy 4 or 5 C-17s.  They would then  turn around and "sell" or "contract" their airlift services out to the CF or whoever would be willing to buy the service they had to offer.
Essentially all that we would be doing is changing our civil outsourced airlift contract for Silk Airways (using the Ilyushin and Antonov) to another company using Globemasters.  Where the hell is the new capability?  These guys think we're going to hand $3.4 billion over to them so that they can turn around and provide us with an outsourced airlift capability??  It was ludicrous.
And at the time they hadn't even purchased the aircraft or even approached Boeing or the US government for approval to purchase the aircraft.
It was just a laughable business plan that this "company" offered .... it was doomed to failure ... and I don't even have an MBA or anything to realize that it couldn't/wouldn't work and it would have been a waste of money for "us", the CF/DND."

- To Joe Public, well . . this (Gods honest Truth) 'rundown' is provided by a CF Pilot with sources in CAS DAR office . . So it Must be True and Reasonably on the mark! I think any company would have taken issue with that - which is what I Politely took him to task for.

So, in all fairness - and with a minor scolding (which we all receive from time to time) - I tried to point out in a Polite and Very Brief manner (considering the length of our Press Release - some 22 pages) what our SoC Proposal had actually involved.    And rather Ironic considering that we had not even had a chance to submit our 'Business Plan', that Globe purported to know all about, as PGWSC/DND had Unfairly disqualified (on all counts) our Fully Compliant C-17 ACAN SoC submission.


As I previously noted, "Of Note, not one US company is willing to pay the US$500M BC-17X R&D/FAA Cert premium, otherwise it would already be in production as the current BC-17X AO already allows US Commercial operation."

    We are a Canadian Company (note - Not US owned), therefore we require a Modified Advisory Opinion [AO], with DND assistance - as Modified AO requests to US Dept of State must be a Gov't to Gov't approach, you can't just "buy the BC-17X AO yet for $500 million" - hence the catch 22 (without DND assistance, only provided under the purview of an Assured Access Contract with DND) and lack of any prior Cdn BC-17X ownership/operations/track record.  This seems to reflect a 'Lack of basic understanding of ITARS restrictions' that Canadian companys must contend with.

Without that AO allowing Cdn ownership/operation not one bank or lending institution will shell out a cent - as without a Modified AO it is illegal under ITARS for a Canadian Company to even discuss contract details with Boeing.  By the same virtue, we will not even waste the time officially registering our Company unless DND/PWGSC shows a willingness to assist with the AO issue by allowing us to fairly compete - if unfairly disqualified with a Fully Compliant product then whats the point of shilling out any more - with a conservative guesstimate of $100K+ spent (not incl. thousands of hours already spent) in research (including fully understanding the Project Cargo market and the competition inside out) and proposal preparation since 2002. 


As I previously noted, "Canadian Globemaster's ACP-S/ACP-Tac Canadian CAMAA submission differs from original CAMAA in that we would provide DND with 30 yrs guaranteed 100% availability for a one-time up-Front Fee less-than cost of 1 C-17 (helps with start-up costs), majority of ACP-S/ACP-Tac funding would still go to Boeing/LM - we think that is a heck of a deal! 
(Actual $$#s are proprietary & confidential.)
No guaranteed annual subsidies or admin fees (as with NATO SALIS) required, especially considering that DND has no equivalent to US CRAF civil fleet."

The original USAF/Boeing CAMAA proposal from 2000 was for minimum production run of 10 BC-17X at US$140M each (1999$), plus US$600M FAA Certification/R&D tag on (divided among the 10 aircraft at US$60M each - originally requested from US Gov't/Taxpayers) for a total valuation of US$200M per BC-17X.
On top of this CAMAA also offered guaranteed yearly haulage contracts (Taxpayer Subsidy - taken from a CAMAA presentation graph) - 'Defense Committed Revenue for 10 Aircraft [Escalated Dollars] = US$10M [2004], US$95M [2005], US$170M [2006], (High of) US$180M [2007],  US$125M 2008, ~US$100M yearly [2009 thru 2018], US$50M [2019].'  Some US$1.58 Billion of US Gov't/Taxpayer long-term subsidy - which is probably why Congress was not interested anymore after the Boeing Tanker Scandal.

So, from Globe's viewpoint, a Cdn Company like Canadian Globemaster that is willing to fork out  ~approx US$1.3 Billion - as part of a Private/Public partnership (like NFTC, UK's FSTA or Allied Wings) just to FAA/TC Certifiy (US$500M) and acquire 4 BC-17X/XM aircraft (~approx US$800M - similar cost for DND's acquisition of 4 BC-17XMs meeting clearly specified Mandatory Requirements), plus an additional Cdn$100M+ for facilities/infrastructure costs (available to DND when needed), plus provide - 100% guaranteed available 4 Canadian BC-17X/XMs on 1st call to DND for 30 years (100% available guarantee just not there with unreliable foreign charters) -  providing both specified at-cost and unlimited  minimal-profit haulage (both of which you will never see with chartering pricey foreign owned An-124/Il-76s - as Globe himself noted our 4 C-17s will require charter top-up), is such a poorly crafted/laughably bad deal for Cdn taxpayers???  That does not even count the Billions required to cover ongoing operations costs and Boeing ISS over 30 years.

All for a one-time up-front Guaranteed Availability Fee (vs. hefty yearly admin/assured access fees charged for either NATO C-17 consortium membership or NATO Salis) to help with some of the hefty up front costs. 
Especially as most of our long-term profit relies on non-DND Commercial haulage and additional BC-17X sales.
Plus, providing DND with integral-Canadian availability of 8 'C-17 Type' airlifters
(and 'Accelerated Delivery' of C-130J aircraft) vs. 4 C-17s, all within the cost constraints of the ACP-S and ACP-Tac aircraft capital acquisition funding limits - of course only after C-17 lease costs are also factored in. 
(I guess 4 extra outsize/oversize aircraft is not New Canadian Capability - must have mistaken those 'Canadian' IL-76s and An-124s sitting on the ramp for foreign a/c.)  :D

    But, I guess, according to Globe's (among others) well-considered acerbic opinions, that unlike Boeing or CAE (or most other businesses for that matter) we must be "greedy" merely because we want to actually turn an eventual profit.  Yup, definitely "a poorly crafted business concept" - of which we haven't even disclosed everything, as our proposed DND Guaranteed Availability contract (less offset costs) would barely cover 15% of our start-up costs, with minimal profit from standard haulage.  But, you are of course welcome to your guaranteed freedom of opinion.


But, in Globe's measured opinion - since "I did only know half the story and I thought it was laughable.  Now I think I know a lot more of the story" - in reality he knew/understood only a fraction of the story.  We don't think an Upfront Assurred Access fee (vs. yearly admin/user fees) is unreasonable - especially considering current Russian/Ukranian An-124 operators obtained many of their initial planes at Zero cost as they were Curiosly 'Gifted' during the dissolution of the Soviet Union.  But, hey, I guess we should not even aspire to play on a partially level playing field - God forbid a Canadian air cargo company receive any sort of support (unless of course they are Air Cannuk or unnamed Quebec-based aircraft manufacturers).

Yet, DND was agreeable to signing NATO SALIS for An-124 access from these very same companies - and you definitely don't seem as hostile to that or even American cargo carriers.
Per SALIS MoU (provided to Globe and Mike) - In addition to the yearly Assured Access financial commitment required by Canada (59.94 hrs) - per sec 3.1.2, Canada would also be responsible for 150 YFH per 3.2.1 and 7.2 - defined at Annex C.  Plus, yearly admin Fee as per 5.2 and 7.1.  All Paid whether used or not.
A German attorney representing Ruslan-SALIS estimated the contract would be worth some Euro26,326 per YFH. (Actually higher at Euro 26,388 per YFH as FSA PM noted "If the full amount of the anticipated flying is taken, it will consist of 3,600 hours of An124 per year at a cost of about 95 million Euros, with a further 2 million Euros yearly for admin costs.")

'The price they demanded for assured access was extremely high,'  says a Canadian Forces SALIS brief obtained by CP.
'It is equivalent to paying out all of the annual potential revenue of each of the six (required) aircraft, which amounts to a full-time lease.'  On top of the retainer, the bidders want Canada and other NATO countries using the planes to pay the full market rate for each hour flown.  'In essence, we pay twice for the aircraft - once when the full potential revenue is paid out for assured access, and once more for each hour flown,' says the brief.
'Under these terms, each flying hour could cost up to four times what a fair-priced market would ask.'
The operators also submitted a list of circumstances that would allow them to default on the assured access terms of the contract without having to pay the heavy penalties that nations want included as insurance.


    We even tried 'thinking outside the box' and adding a bunch of Army-related offsets (1st 4 armor related), and some constructive proposals ideas.  Although, we gather some Grumpy Bears don't seem happy with a Canadian company trying to be creative and help the Army acquire new tracked armored vehicles - by offering offet cost reductions, and would prefer to get them from 'steadfast' allies such as Germany that are standing shoulder-to-shoulder with our troops in Southern Afghanistan (oops - guess thats the Netherlands, not Germany  :D), nor are they interested in reconstituting Assault Troops or Pioneers.

Plus, (in the spirit of adequate TSSU airspace protection/ASCC deconfliction - which directly affects any Civil aircraft resupplying the TSSU) pointing out Serious problems with the Army's under-resourced AD community (as oft asserted by the AD experts themselves - but repeatedly ignored) to DND heirarchy - not something we Had to do but felt Compelled to do after noting the effectiveness of properly resourced ADATS units, and providing fiscal incentives (last 3 offsets) to rectify the situation within the Army's desire (until-recently) for a mainly Wheeled LAV-based structureDefinitely not something a foreign air cargo company would ever do, but as a 100% Canadian company wanted to do to show our support for the Army. 

As I messaged Gen Hillier, "we feel it is our duty to point out, as concerned Canadians, a clearly visible lack of support for the GBAD community
- purportedly 'the Crux of Army Transformation' (per previous CLS).
[Note:  Per 17 Oct 2005 'Online Establishment Browser':  (C. includes 3K Exp PYs)
A.    152 Current GBAD PYs; 
B & C as Proposed by Canadian Globemaster (per sec 10.2.5),
B.  444 Interim GBAD PYs;  C.  628 Finalized (LFCR3) GBAD PYs.
% of 26,559 PY in Land Force Command:  A. 0.57%;  B.  1.67%;  C.  2.12%.
% of 11,858 PY in RegF Field Units:            A. 1.28%;  B.  3.74%;  C.  4.23%.

The % #'s for A. are quite Shocking, considering: 'April 2003 GBAD Manning Summary - 458 PYs,'
especially since LGen Caron had noted re: ADATS capability:
"MMEV is Key to CF transformation and should be evaluated against other investments in that light."]"

With our constructive force structure proposal ideas (and exhaustive research behind each) clearly available to review from 15 March onwards (ATI due date at PWGSC).


    But, alrighty then, whatever, obviously I'm talking to the wall.
Globe (et al) clearly have preconceived notions and don't clearly read (i.e. skim) what I've posted about the ITARS restrictions that limit Cdn ownership/operation.
You'd rather continue to augment Cdn C-17s with 'risky' supplemental chartering of foreign outsize/oversize aircraft from Silk Air.
Oh, and to use Globe's BC-17XM disparaging example - the C-17 has "numerous layers of combat redundancies on various systems (quad redundancies in the flight controls for example)" - even the purely Civil BC-17X has 98% Commonality in Flight Controls (see image at [http://www.defenseindustrydaily.com/2006/06/canada-joining-the-anglosphere-c17-club/index.php]
which - after a 5-month lag - finally noted Canadian Globemaster's ACP-S ACAN submission.  Unfortunately, with some major misconceptions/omissions).

As Globe and certain other AF/Army blokes have shown, before/since I posted the Brief Summation, they definitely don't have any hesitation in providing disparaging comments without knowing full details (yep, real officer leadership qualities - I'd hate to be the NCO that provides them with advice - just my constitutionally guaranteed personal opinion)
- details offered without reservation as we noted,
i.e. "Press Release, available upon request to anyone who wants a copy".
Yet, only Globe belatedly asked for/received a copy of our Press Release (plus a copy to Mike Bobbit - along with various BC-17X technical info).
Other than point 6 of Inaccuracies/Misperceptions, for which I had every right to show annoyance, my other clarifications were offered in a Polite and Very Brief manner.

Quite contrary to Globe's oft asserted "apologies for any unintended personal offence I may have caused.  “That” was certainly not my purpose."  Sure doesn't come across that way.
Especially, such adult remarks as, "But my sources are the guys who got to witness what was going on in negotiations.  But I stand corrected ….. it sounds as if you were actually there."
[I Never asserted any such thing - with our SoC being unfairly disqualified, even though our proposed BC-17XM met all Mandatory Requirements, we never got the chance.]
As Good2Golf clearly agreed, "personal attacks aren't on", thus closing the thread.

I'm sure that as a Civy, if I made similar, uncalled for, nasty disparaging/defamatory/inaccurate comments as made by others I'd be on the Army.ca warning list by now (per guidelines).
I'm all for informed free speech, but not uncalled for remarks/disparaging tone.

So, continue to post what I'm sure will be similarly disparaging comments as I've put up my Firewall and will waste no more time on this topic - nor continue posting on a seemingly biased forum.  I doubt that other representatives will want to provide their opinions either - clearly informed (i.e. after reading Press Releases) discussion just is not on.  :(
Gobsmacked signing off.

PS: And, purely for Examples sake - If I was to post in that same 'apologetic' spirit that Globe proffered his constitutionally guaranteed acerbic comments:
I would note that obviously knowledgeable AF officers - that offer such 'measured opinions' before perusing the data available (as they figure they know most of the facts), would never allow us to discard 'urgently needed capabilities such as medium-lift Chinook helicopter support' - but wait, don't we have to bum rides off the Dutch as they have our old helicopters that we disposed of with such forethought when the 'Cold War' ended because 'knowledgeable' AF officers decided that was a capability we could live without.  But, hey, thats just my constitutionally guaranteed personal opinion - I hope that hasn't personally offended anyone (not my intent).  :D
 

Zoomie

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I like your use of "acerbic".

In all fairness the deal has been inked and all of this is a moot point. 

My suggestion to your company would be to get a financial backer and buy a few BC-17s and maybe we will rent their use from you instead of using the Antonovs.
 

C1Dirty

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Gobsmacked

Between my small brain and your indiscriminate use of bold, italic, andunderline, I have a real hard time figuring out who said what.  Could you explain the thrust of your company's bid in a few sentences for us simpletons.

Thanks Homes
 

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In Et Laymanus Terminus;

Boeing was Offering the Services we currently rent from Silk Air, heavy lift tspt
A Canadian Company was offering this service as well, but was shut out and shot down by their own gov't

In the end, we bought the 4 C-17s and will undoubtedly need supp. airlift capability that we shall have to rent from the russkies or boeing rather than a homegrown company.

 

ringo

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Bloomberg reports Global Heavylift has approached Boeing with a $10.8 billion dollar letter of intent for C-17 purchase.
 

observor 69

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Global Heavylift Plans to Buy C-17 Cargo Planes From Boeing

By Courtney Dentch

March 3 (Bloomberg) -- Global Heavylift Holdings LLC, a closely held company that wants to use military cargo planes for commercial purposes, plans to buy new or used Boeing Co. C-17s, a company co-founder said.

Global Heavylift has approached Boeing about buying the planes and has a $10.8 billion letter of intent from Oppenheimer & Co. to fund the purchase, said Myron Stokes, a Global Heavylift co-founder, in a telephone interview today. The planes, which carry a list price of $200 million, would be used to carry heavy and oversize machinery, including oil rigs, bulldozers and mining equipment, and would be leased, he said.

``If you're developing new oil and gas, gold or diamonds, these things usually are not very easy to get to,'' Stokes said. ``C-17s are able to go wherever there's flat earth'' for them to land.

The announcement comes one day after Boeing said it would stop production of the C-17 planes in mid-2009 due to a lack of orders. Chicago-based Boeing needs orders for 16 more planes to keep the line open, Dave Bowman, the aircraft's program manager said on a conference call yesterday.

Global Heavylift of Bloomfield Hills, Michigan, plans to buy 60 used planes from the government, giving the military a chance to update its inventory, or 30 new planes, Stokes said. The company has also expressed interest in taking over the production line from Boeing if the aircraft maker is forced to stop making the C-17s.

Funding Necessary

Calls from Bloomberg News to Jack Brusewitz, vice president and co-manager at Oppenheimer, weren't immediately returned.

Bowman said yesterday there has been interest in commercial use of the C-17s, although Boeing spokesman Rick Sanford couldn't immediately confirm the company has gotten a request from Global Heavylift.

``We have been speaking with serious companies that have a strong interest in obtaining derivatives of the C-17 for commercial use,'' Sanford said today. ``That will be moot unless we get the funding from the U.S. government to keep that line open.''

Boeing has 190 U.S. Air Force C-17s under contract and will deliver the 162nd of those next week, Bowman said. While the Defense Department added funding for 10 more planes in December, it didn't request money for new C-17s in the 2008 federal budget, which was released last month.

The C-17 line, which provides about 25,000 jobs nationwide, including parts suppliers, was almost halted last year.

That order was reversed in August when funding was earmarked for additional Air Force planes and agreements were made with international customers, including the North Atlantic Treaty Organization, Australia and Canada.

To contact the reporter on this story: Courtney Dentch in New York at cdentch1@bloomberg.net .


http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aLruD6.HPifA
 

Good2Golf

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...PS: And, purely for Examples sake - If I was to post in that same 'apologetic' spirit that Globe proffered his constitutionally guaranteed acerbic comments:
I would note that obviously knowledgeable AF officers - that offer such 'measured opinions' before perusing the data available (as they figure they know most of the facts), would never allow us to discard 'urgently needed capabilities such as medium-lift Chinook helicopter support' - but wait, don't we have to bum rides off the Dutch as they have our old helicopters that we disposed of with such forethought when the 'Cold War' ended because 'knowledgeable' AF officers decided that was a capability we could live without.  But, hey, thats just my constitutionally guaranteed personal opinion - I hope that hasn't personally offended anyone (not my intent).

Gobsmacked, you're out of your lane on this one.  It is a matter of record that this was the Army's decision, notable Comd FMC in November of 1989, not to upgrade the seven remaining CH147 to CH47D standard for a cost of $400M BY89.  LGen Foster sent a letter to Comd AIRCOM in Winnipeg and CADO in NDHQ of the day confirming that FMC would not fund the required upgrade.  You may have an opinion as to whether the Army (or more accurately, Force Mobile Command of the day) made the right decision to not proceed with upgrading the CH147, that is your right.  Placing blame on any Air Force officer for that matter is categorically mistaken.  You may check public records and inform yourself of the fact that capital and weapon-system O&M was not an Air Force responsibility for tactical aviation resources until 1992, a full year after the last Chinook was put to bed in Mountainview. 

Your attempt to paint Globesmasher and other "obviously knowledgeable" Air Force officers as offering "measured opinions" to which they are not entitled is hollow.  If you choose to take the issue personally on behalf of CANADIAN GLOBEMASTER that again is your choice. CANADIAN GLOBEMASTER has not, as far as anyone here knows, made its detailed business case and offer a matter of public record, thus there can be no meaningful FORENSIC analysis to CANADIAN GLOBEMASTER's claims that it would have been the best option for the provision of dedicated heavy-lift capability available to the Air Force.  Perhaps you might enlighten us with what action CANADIAN GLOBEMASTER undertook with the Government of Canada after the Globemaster contract was signed with Boeing?  That might give all of us here the opportunity to situate your commentary of displeasure accordingly.

Additionally, as others have noted, your post's formatting makes it very difficult to understand the issues you attempt to address.  May I suggest simpler formatting using some of the tools available on the forum (lists, etc...) and less use of bold, colour, all caps and underline.  Underline is generally understood to represent a hyperlink...I tired from trying what appeared to be hyperlinks to get more information, only to find that in fact none of them were hyperlinks...including the promising:

THE TRUE SKINNY (- per Press Release #4 distributed 20 Feb 2007)

...which many of us thought was a link to the press noted release.  It would be most helpful if you posted a URL where your company's Press Releases are contained?  Many forum members would like to inform themselves further on the issue.

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Extremely interesting read gentlemen.  Though I won't comment on the details, I have but one question;  Will Gob still be a "CF Advocate" after this?

Break into groups.



kc
 

dapaterson

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we will not even waste the time officially registering our Company unless DND/PWGSC shows a willingness to assist with the AO issue by allowing us to fairly compete

Let me be sure I have this straight:  You can't be bothered to register the company?  So why should DND/PWGSC treat you seriously if you won't take even that basic step?

 

Gobsmacked

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G2G - "Gobsmacked, you're out of your lane on this one.    It is a matter of record that this was the Army's decision, notable Comd FMC in November of 1989 . . . You may have an opinion as to whether the Army (or more accurately, Force Mobile Command of the day) made the right decision to not proceed with upgrading the CH147, that is your right.  Placing blame on any Air Force officer for that matter is categorically mistaken."

G2G, I stand corrected.  But thanks for the info - most non-military Civies (like myself) did not even know that.  While I knew the Army had been responsible for their tactical employment, I had obviously incorrectly assumed that if the AF flew them they also managed their O&M.  Who knew.

(Puts on Asbestos Fire Suit for incoming fire)  Guess I should have properly stated "obviously knowledgeable Army/Military officers".  But please remember, this PS: comment was " purely for Examples sake".

G2G - "CANADIAN GLOBEMASTER has not, as far as anyone here knows, made its detailed business case and offer a matter of public record, thus there can be no meaningful FORENSIC analysis to CANADIAN GLOBEMASTER's claims that it would have been the best option for the provision of dedicated heavy-lift capability available to the Air Force."

Aha, FORENSIC, not Foresnic.  Gotchya.
Well, as stated previously, "our constructive force structure proposal ideas (and exhaustive research behind each) clearly available to review from 15 March onwards (ATI due date at PWGSC)."
And for those with a checkability deficit - it's ATI # A-2006-00519.

G2G - "Perhaps you might enlighten us with what action CANADIAN GLOBEMASTER undertook with the Government of Canada after the Globemaster contract was signed with Boeing?  That might give all of us here the opportunity to situate your commentary of displeasure accordingly."

"Press Release #4 distributed 20 Feb 2007" - This was distributed to Senior GoC Ministers, MND, PM, and various media contacts incl. the forum's C-17 lurker.

G2G - "...which many of us thought was a link to the press noted release.  It would be most helpful if you posted a URL where your company's Press Releases are contained?  Many forum members would like to inform themselves further on the issue."

Sorry, no URL link.  Only some partial (uncorrected - they don't take kindly when you point out omissions or glaring errors in their articles) mention on that 'DID' website I noted.
I've repeatedly copied many Media, but who knows how they decide what they want to print - or what the underlying agenda of the few Media Moguls (that control the majority of the publications) is.  Although when I talked with JDW Americas Editor Stephen Trimble he mentioned they may have a short mention upcoming?

As previously said to Forum members, "I'll let you review the full Press Release, available upon request to anyone who wants a copy (just let me know what e-mail address to Bcc it to - all e-address's will remain strictly confidential), to obtain an accurate 1st hand idea of what was actually proposed."
View my Profile, "Email" address not a secret to Forum members - clearly listed.
If Forum members prefer, I can e-mail a copy of PR#4 to Directing Staff.  Or ask Mike as I indicated I already Cc'd him a copy.


C1Dirty - "Could you explain the thrust of your company's bid in a few sentences for us simpletons."
Dixon - "In Et Laymanus Terminus;
Boeing was Offering the Services we currently rent from Silk Air, heavy lift tspt
A Canadian Company was offering this service as well, but was shut out and shot down by their own gov't.
In the end, we bought the 4 C-17s and will undoubtedly need supp. airlift capability that we shall have to rent from the russkies or boeing
(potential US operators) rather than a homegrown company."  Offering Double the ACP-S capability = 8.4 C-17s.

C1Dirty/Dixon - Good Question/Answer.

See also, [http://boeingc17.blogspot.com/2006/11/our-leopard-tanks-leapfrog-to.html]

As simple as I can make it, or (to use a colloquial book term from best selling series of books),
Canadian CAMAA 'for dummies'.

Within ACP-S / ACP-Tac capital aircraft procurement allocations, Canadian Globemaster would have provided, had we been given the chance to compete in a fair and open competition - Total Moose Droppings! (unfortunately with 'National Security Exemption' ACAN we don't even have US last-resort of a GAO to file protest with) by PWGSC/DND as we clearly demonstrated we met All ACP-S Mandatory Requirements:
  • Upon receipt of Modifed AO (obtained with Required DND assistance) allowing Canadian BC-17XM/BC-17X ownership/operation, we would undertake FAA/TC Certification of BC-17XM (by 40 months) & BC-17X (by 48 months);
  • 2 ACP-S  C-17 Leased by DND from USAF for 2 years (from Mandatory 18 months - 42 months);
  • 4 ACP-S  BC-17XM Owned/Operated by DND by Mandatory 48 months (each BC-17XM with 5% incr. in cargo payload vs. C-17);
  • 4 LRIP (Low Rate Initial Production) BC-17 (2 BC17-XM, 2 BC-17X), owned by 100% Canadian company Canadian Globemaster, Guaranteed 100% available to DND for 30 yrs - per FSA SOR charter terms - for reasonable one-time Up-front availability fee.  Providing Low-cost or specified at-cost haulage whenever required;
  • 14 (of 17) ACP-Tac low/zero-houred ex-RAF C-130J available by 2010 from 2007/2008 (in exchange for 4 BC-17XM ~= 17 C-130J) - Before LM was able to ramp-up C-130J deliveries from May 2010 at 4 per year, considering DND's ACP-S SOR assertion thatThe requirement for this equipment is Urgent!';
  • Previously noted Army friendly offsets such as specified yearly at-cost haulage - a Major plus when a TSSU requires urgent augmentation from Canada by Armoured/GBAD units;
  • Optional CA/NE Armoured Equipment Exchange (i.e. Leo2A6, PzH2000, AH-64D) made possible by trade of 2 additional lower-cost BC-17XM funded from within TB pre-approved MGS allocations.

Plus 3 additional important notes I almost forgot to mention:
1. As noted on the following site [http://boeingc17.blogspot.com/2006/11/letter-to-auditor-general-of-canada_25.html] and previously pointed out to DND/GoC in our Fall-2003 Formal Unsolicited Proposal (which received favourable direct replies from both then CAS and ADM[Mat], even though Liberal Gov't at time did not want strategic lift), as the ACP-S procurement does not allow for C-17 replacement should a catastrophic  accident occur at some point in the future we would have noted in our proposal (had we not been Hastily & Unjustifiably Disqualified) that we would have been willing to make one of our BC-17XM available for DND to acquire as a replacement-in-kind. 
Yet, this past fall a Mr Bradshaw from PWGSC, replied to the blogspot poster, on behalf of Mr. Fortier the Minister, that the C-17 fleet had flown in excess of one million miles without any accidents, that it was considered a very reliable aircraft, and that the Canadian Military anticipated no losses.  Obviously, with the same careful research and due-dilligence that typified their hasty disqualification of the BC-17XM on 11 August, PWGSC/DND obviously did not look at Boeing's own in-house 'Boeing Frontiers Online' [http://www.boeing.com/news/frontiers/archive/2006/february/i_ids1.html] - which has a revealing story about, say it isn't so, a C-17 that suffered 'severe' damage to it's landing gear during a landing (oops - Boeing said 'mishap' so we guess it wasn't an accident) at Bagram airport in Kabul in August 2005.

2. As we noted in PR#4, The Hon MND Gordon O'Connor has repeatedly asserted in recent days that, "The procurement process has been thorough . . . by using a pragmatic and efficient process that was nevertheless . . . fair, open and transparent."  While Mr. Fortier stated in Feb 2007 that "An ACAN is not a sole-source contract, it's a RfP with a twist, that's all it is."
Both statements are Complete and Utter Rubbish / Horsepucky!

Even the Auditor-General of Canada agreed last week when she noted to the Commons Defence committee, "as I've said earlier . . . we have taken the position that ACANs are not competitive."  :salute:  http://boeingc17.blogspot.com/2007/03/alec-castonguay-article-in-le-devoir.html
See also [http://boeingc17.blogspot.com/2007/02/shame-lies-and-insult-before-standing.html], which notes that to exclude other contenders, 'DND added other requirements (i.e. June 2006 change that Doubled Payload req't to the surprise of DAR Col Dave Burt), dates, and all sorts of details right up to cup-holders in the aircraft cockpit, to exclude the other possible suppliers.  (Although, unsurprisingly, the BC-17XM meets all Mandatory Requirements, with leased C-17s meeting interim the In-service/Certification req'ts.)  If that was an open, fair and transparent process, then the Americans do not practice and sub-contract torture and Iraq was responsible for 9/11.'
Plus, as noted [http://boeingc17.blogspot.com/2006/10/what-canadian-law-states-and-where-it.html], ignoring the Il-76/An-124 bias, the C-17 ACAN process clearly broke Canadian laws  :blotto: - as effectively noted by Auditor-General Sheila Fraser.
Canadian Globemaster will also be providing extensive information (without reservation) to aid in the Auditor-General's investigation into the Flawed ACAN process.
Although, we wonder how long before she is 'forced to retire'? and the investigation quietly fades away.

3. As seen in the actions of Senior DND Generals, as noted in above noted Post #41 at [http://boeingc17.blogspot.com/2007/01/index-of-all-posts.html], and [http://boeingc17.blogspot.com/2007/02/short-resume-of-this-blog.html] there seems to be a willingness to say whatever it takes to make Only the C-17 happen.
'General Hillier, when explaining why we needed C-17s, repeated the lie that Major General Daniel Benjamin said in front of the same committee on Oct 4th 2006: that C-17s are essential to the current operation because AN-124s cannot land in Kandahar.'  Even an 'Antonov 225, the largest aircraft in the world, larger than an AN-124, . . . is pictured here parked in Kandahar.
THAT IS A BLATANT LIE. (Unless of course he meant Kandahar, Saskatchewan)'
  :(  :-[
Meanwhile, as I've alluded above, there seems to be a complete Media Ignorance/Bias towards the C-17 as 'the only solution', while [http://boeingc17.blogspot.com/2007/01/press-gets-into-high-gear.html] and [http://boeingc17.blogspot.com/2006/11/our-leopard-tanks-leapfrog-to.html] also confirm this view.


Both Canadian Globemaster and I remain committed to the troops,  :salute:
just not at all impressed with the Bureaucrats at PWGSC/DND or the Politicos, not to mention slanted Media coverage that pretty much ignored our Fully Compliant offering.
No point in me rehashing anymore.
Gob  :cdn:
 

Gobsmacked

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Baden  Guy said:
Global Heavylift Plans to Buy C-17 Cargo Planes From Boeing

March 3 (Bloomberg) -- Global Heavylift Holdings LLC, a closely held company that wants to use military cargo planes for commercial purposes, plans to buy new or used Boeing Co. C-17s, a company co-founder said.
Global Heavylift has approached Boeing about buying the planes and has a $10.8 billion letter of intent from Oppenheimer & Co. to fund the purchase, said Myron Stokes, a Global Heavylift co-founder, in a telephone interview today. The planes, which carry a list price of $200 million.
[Airframe only - no engines or GFE systems which bring price up to "US$229.8M per C-17" (per USAF budget documents)

The announcement comes one day after Boeing said it would stop production of the C-17 planes in mid-2009 due to a lack of orders. Chicago-based Boeing needs orders for 16 more planes to keep the line open, Dave Bowman, the aircraft's program manager said on a conference call yesterday.

Global Heavylift of Bloomfield Hills, Michigan, plans to buy 60 used planes from the government, giving the military a chance to update its inventory, or 30 new planes, Stokes said. The company has also expressed interest in taking over the production line from Boeing if the aircraft maker is forced to stop making the C-17s.

Funding Necessary
Calls from Bloomberg News to Jack Brusewitz, vice president and co-manager at Oppenheimer, weren't immediately returned.

Bowman said yesterday there has been interest in commercial use of the C-17s, although Boeing spokesman Rick Sanford couldn't immediately confirm the company has gotten a request from Global Heavylift.  "We have been speaking with serious companies that have a strong interest in obtaining derivatives of the C-17 for commercial use,'' Sanford said today. "That will be moot unless we get the funding from the U.S. government to keep that line open.'' 

Boeing has 190 U.S. Air Force C-17s under contract and will deliver the 162nd of those next week, Bowman said. While the Defense Department added funding for 10 more planes in December, it didn't request money for new C-17s in the 2008 federal budget, which was released last month.

ringo/Baden Guy,

I see that you have both fallen for the GHH misinformation campaign - and I note that, like the reporter, you obviously take everything they say at face value as I note neither of you has any negative or questioning comments about that proposal.

US BC-17 potential GHH was one of many that we messaged during 23 Feb Stage 2 of Canadian Globemaster's Canadian CAMAA Press Release #4 with additional background info,  including:
additional Can/US media (incl. Calf Press that have purported to be interested in survival of LongBeach line); Bergen at CDFAI; Gov'tNWT; various air cargo and AFmags; various transportation expediters; Lexington Institute - strong C-17 advocates; Calif Governor; various Heavylift contacts; LongBeach mayor; firstair; EADS; DoS ODTC; and CargoForceLSS - another US BC-17X potential.

GHH's Myron Stokes was so perturbed by our e-mail, which he was copied on that included [the information noted below], that he fired off a next-day Public Domain reply (listed after the note below) to all receipients, obviously realizing that in our background note (as it was provided purely for background information sake) we had made a valid unarguable point - but not admitting it and trying to paint that we "lack the necessary sophistication to understand" their proposal.

Yet, based on the most recent release a mere week afterwards, the nominal amount GHH are willing to pay USAF per used C-17 has - without explanation - suddenly shot up from a mere US$140M to US$180M per used C-17 (US$10.8B / 60) in just 1 year, Wow - talk about inflation.  We think that speaks volumes.
Yet the release does not include note of being willing to cough up the US$500M R&D/FAA Certification Fee noted by Boeing executives as recently as Sept 06. 
He also conveniently, yet again, ignores the March 2006 ruling by SAF noted below - which makes their idea a Non-starter.

Stokes also tried to imply that we "seem totally oblivious to the continuous fight to save the C-17"Yet, he completely ignores that Canadian CAMAA would have added Minimum 9-11 (now just 8-10) additional BC-17 tails to the C-17 line - saving US taxpayers the expense of funding the full "procurement of 16 C-17s required in FY2008 ":cdn:  :salute:
noted Boeing vp and C-17 program manager David Bowman, for Boeing to maintain the production line.  We also "take a dim view when the advantage of one party associated with a similar enterprise is sought at the expense of another through dissemination of disinformation."

See also [ http://boeingc17.blogspot.com/2007/03/air-america-is-back.html ] for some additional insights on the GHH 'Air America' release.

- see also article by Dr Daniel Goure on Lexington Institute website re: CargoForceLSS.
'A DEAL SO GOOD ONLY THE PENTAGON COULD TURN IT DOWN' .

- (per April 2006 'Air Cargo World' online article 'An-124 Alternative') - 'Global Heavylift Holdings believes there may be.  GHH seeks to turn the U.S. military C-17 transport into a commercial outsize cargo aircraft.  For now, there is no legal means of doing so.  GHH hopes the U.S. Congress will pass legislation that allows the U.S. military to sell used C-17s for commercial use, and that allows Boeing to manufacture new C-17s intended for commercial use.'

    [Although, Congress is extremely hesitant to proceed with any sort of 'heavily subsidized' C-17 acquisition, which is what (we should have properly noted - in our constitutionally guaranteed personal opinions only) seemingly amounts to as GHH propose acquisition at a mere US$140M per used C-17, as it remains leery after the Boeing KC-767 lease scandal.
CANADIAN GLOBEMASTER can enable BC-17X/XM production at No Cost to the U.S. Taxpayer!

The GHH proposal noted above (based on a 2005 USAF/Boeing CRAF proposal) is unrealistic, both as to subsidised price and lesser cargo capacity of older C-17s (that would have been the focus of a sell-off) - prior to P51 - as they make less use of Composite structrures and weaker wing structures.  Additionally, the USG/Taxpayers would not take too kindly to subsidised acquisition of ex-USAF C-17s that have just undergone a MultiMillion $$ refit to include the C-17ER centre-wing fuel tank capability and modified landing gear, to name but a few upgrades.]

In the Project Cargo (outsize/oversize) business payload capacity is everything!  The heavier the payload the higher the profit.  Any early C-17s Converted to BC-17X configuration would be at a weight disadvantage compared to new-build BC-17XM and BC-17X that Canadian Globemaster proposes.

- With 8 March 2006 notice to Sen. John Warner, Chrm SASC, by USAF Secretary Michael Wynne that, "Since the entire outsized inventory is needed in the organic fleet we are unable to identify any viable options to introduce outsized airlifters into the CRAF", the subsidized ex-C-17 option thankfully died a quick death.

- Our American friend, GHH principal Myron Stokes, replied on 24 Feb:
"We have been copied on the above subject communication (copied below), and decided to respond as a result of data inaccuracies presented by our Canada-based friends with a stated interest in a commercial variant of the C-17.

First, we are always encouraged when other parties show interest in this solid initiative, but take a dim view when the advantage of one party associated with a similar enterprise is sought at the expense of another through dissemination of disinformation.

GHH, LLC believes that to be the case here with the issuance of the CG AAOOACI advisory.  Through an attempt to imply that we seek tax payer funding/government subsidization as was the original structure of the CAMAA program, it demonstrates that their data is at least 6 years old and they chose to ignore the precise details outlined in our February 9, 2006 release.

It is also clear they lack the necessary sophistication to understand that "transformational recapitalization" is not a subsidy or a lease structure (there was nothing wrong with the 767 lease structure to begin with: It represented new thinking in the defense appropriations/authorization arena.  Rather, it was the poor choice of industry/government acquisition communications pathways exhibited by specific involved parties in the AF and Boeing who were subsequently prosecuted) but an effective means through which traditional budgetary concerns/restraints for defense related platforms -- in this case the superlative C-17 -- are most thoroughly addressed.

They also seem totally oblivious to the continuous fight to save the C-17, without which the HeavyLift program can exist."

END

Regards,  Gob
 
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