Canada and Sikorsky continue to work at the mess that is the CH-148 Cyclone maritime helicopter program. The Department of National Defence (DND) has posted an update on the much-delayed program, while procurement agency Public Works and Government Services Canada (PWGSC) says it will impose significant additional penalties on Sikorsky for late delivery.
Sikorsky parent United Technologies, meanwhile, has taken a $157 million charge to cover its costs for the delays, including the expected penalties. Also Sikorsky will lose $14 million on each of the 28 helicopters it delivers, and now admits its C$3.4 billion ($3.3 billion) 20-year in-service support contract will never recover the losses on its C$1.9 billion procurement contract.
When the contracts were signed in November 2004, the first CH-148 was scheduled to be delivered in November 2008. The root of the problem is that Canada signed a fixed-price procurement contract for an aircraft that still had to be developed. The contract requires the delivery of fully compliant helicopters, and the Cyclone is not there yet.
Sikorsky has been trying to persuade Canada to modify the contract to allow it to deliver the aircraft in an interim standard, then upgrade them. And it claims the DND wants to take the helicopters, so that it can begin training, but part of the problem is that the contract is with PWGSC, which is a separate agency.
The manufacturer says 24 of the 28 Cyclones are in production, assembly or test. Four of them (804, 806, 807 and 808) have been delivered to CFB Shearwater, but they remain the property of Sikorsky and are being used as ground‑based aids to support technician training. No aircraft were delivered in 2012, and Sikorsky is now planning to hand over eight a year beginning in 2013.
The original contract was renegotiated in December 2008, and required delivery of fully compliant helicopters to begin in June 2012 (a delay of 3 years 9 months). Unless that contract is modified, that means Sikorsky will not complete delivery of the helicopters until 2015.
But the DND, in its update, says it expects "to take formal delivery of the interim maritime helicopters in 2013", which might offer a glimmer of hope. The DND says issues that must be resolved before it can take formal delivery of the first interim helicopters include Canadian military flight clearance and training of the initial cadre of aircrew and technicians.
The Cyclone, a unique and substantially modified derivative of the commercial S-92, encountered problems first with the aircraft and later with its mission system. Sikorsky now says the mission system equipment is 97% complete -- enough to begin training, it believes, but not everything the DND wants and the PWGSC contracted for.