As David Pugliese of the Ottawa Citizen wrote yesterday, the cost of an F-35 Lightning II in Low-Rate Initial (LRIP) Production Lot 7 is now forecast to be $113 million—including the engine, that is. That immediately reminded me of Terry Milewski's story for CBC News back in February—"Boeing touts fighter jet to rival F-35—at half the price". That story extensively quoted Boeing's chief test pilot for the F-18E/F, RCAF veteran Ricardo Traven, who provided a litany of advantages of the Super Bug over its "paper airplane" competitors. Compared to the F-35A, F-18E, he believes, is much more maneuverable and durable, with its bigger wings and control surfaces, stronger landing gear, and its twin engines.
Folks I know at Lockheed will hotly debate the relevance of these attributes. As I noted in my post of yesterday, maneuverability is rather important if the presumably vicious lethality of the latest and future versions of the air-to-air missiles like AMRAAM, and against the latest and future opposing aircraft, is all that it's said to be. Some F-35 enthusiasts have argued to me that air combat today can only be fast and lethal, and at long range. But as John Stillion and Scott Perdue, formerly of RAND, argued in their (in)famous August 2008 briefing "Air Combat: Past, Present, and Future", the track record with missiles is good, but not fabulous, and much depends on the state of the art in countermeasures.
So, here comes my first observation about uncertainty. In any fighter-bomber purchase for the RCAF, opposing gambles will be underway. Investment in an aircraft optimized for long-range missile combat—such as the F-35A—is a gamble that the trend of technology vectors in that direction. Investment in an aircraft more appropriate for all-around air-to-air and air-to-ground performance—such as the F-18E—is a gamble that long-range missile fire won't predominate.
Of course, the F-18E is perhaps not an F-16C Block 52 or even a Block 60, so if one is really looking for air-to-air performance at a bargain price, one might look back to Lockheed. But what of those prices? Back in February, Boeing's people also told the CBC about how much less the F-18E would cost the Government of Canada—fully $23 billion less over time. That is, Milewski's story for the CBC claimed that
As it stands, the official estimate for a fleet of 65 F-35s is that they will cost $9 billion to buy and almost $37 billion to operate over the next 42 years. So, a total of just under $46 billion. If Boeing's figures hold up, the Super Hornets would cost about half that.
Thus, the occasion of this news of the latest repricing seemed to provide a good excuse to review some numbers. Here's what the Pentagon asked the US Congress for last year:
Super Hornets—In its Fiscal Year (FY) 2013 budget request, the US Navy proposed buying 26 F-18Es and -Fs for $2,098 million, or $82 million each. That's nowhere close to the $55 million cited in the CBC story, though it is rather less than the figure that comes next.
And as noted in that story, the US Government Accountability Office (GAO) agrees with Boeing's estimate that the flying cost of the F-18E is about $16,000 per hour, which is really quite modest for a fighter-bomber. That number was presumably easy to verify, as the US Navy has been flying hundreds of Super Bugs—through the necessary abuse of catapult shots and arrested landings—for over a decade.
Lightning IIs—In its FY13 budget request, the USAF proposed buying 19 F-35As for $3,448 million, or $182 million each. That was LRIP 5. Under LRIP 6, Lockheed is on contract to deliver 23 F-35As for $103 million each, or roughly $118 million with an actual engine, forecast to cost $15 million at that point. Under LRIP 7, as noted above, the USAF will be getting the planes for roughly $113 million, with an engine presumably at that price. What seems clear is that the figures that the Pentagon reports to the Congress bake in some costs that go elsewhere.
The operating costs are hard to estimate in advance, even if the program office, the various services, and the Pentagon's official cost estimators have been arguing about the numbers. At one point, though, the GAO had estimated the figure as $32,000 per hour—literally twice that of the F-18E.
The analysis would not be complete, though, without acknowledging the actual contract awards tabulated by Giovanni de Briganti at Defense Aerospace for LRIP 5, which come to $209.34 million for 30 aircraft, or $209 million each. That unit cost is rather less appealing than one of $182 million, even before we discuss those Super Bugs. That the Pentagon might shift figures into different fiscal years to show the right cost slope is not shocking: companies like General Electric and IBM have at time in the past seemed really good at earnings management, even if smart stock analysts can't be fooled. And so, folks like de Briganti have been including engines in the tallies because the operating costs include engine maintenance, and because engines are said to be somewhat useful for flight. But also useful for combat flight is sensor and weapons software that works, and internal components that can assuredly survive lightning storms. Those are notably things that the Lightning II yet lacks.
And so, this leads to my second observation about uncertainty: quite apart from what anyone believes about what's necessary in combat, Lockheed's aircraft may or may not eventually work.
Perhaps it will, but at least a few weapons never were quite right. The Sergeant York antiaircraft cannon was a total fiasco, the Phantom II could never be turned into a real fighter plane, and the Expeditionary Fighting Vehicle never ran reliably before it was dumped. So success is not guaranteed, regardless of how many billions the government applies to the problem.
For the moment, though, let's put those uncertainties on the shelf, and focus on the costs. By the prices that the Pentagon is paying, and presuming that those figures are comparable to the prices that Canada will be offered, the gap in FY 2013 between the cost of an F-18E and the cost of an F-35A is at least $100 million. That's the difference in what the Pentagon is paying this year between those two aircraft. Next year, the gap between an F-18E and an F-35A is said to be $35 million, if the Pentagon's accounting is believable at this point. Let's remember that it wasn't on LRIP 5. Lockheed's cost curve looks to improve on that, but note that the advertised difference between the LRIP 6 and LRIP 7 prices is just $5 million. The progress curve is clearly flattening. If this learning-by-doing thing is running out of steam, the finances could get worse.
So if the Tories really are committed to hold the line at one percent of GDP, the RCAF could be rather short on aircraft at the end of the buy. Canada is a big country, and for air defense, when the RCAF is on campaign overseas with NATO, quantity may have a quality all its own. But under these terms, consider the worst that might happen. Canada is not about to go to war apart from a coalition. If face-shots with missiles really are the future of aerial combat, but the government chose the Super Hornet, the RCAF would find itself with a fleet of bomb-trucks, very useful for close air support of the Canadian Army and allied ground forces, where stealth will matter much less, and not so much at all in daylight. That degree of specialization might not fit with the ambitions of airpower enthusiasts, but it would fit with the fighting traditions of the Canadian Forces, and how they have actually fought since the dissolution of No. 6 Group in 1945. At a time when Canadians are debating whether the Army should be fully committed to peacekeeping, or capable of more intense combat operations, an RCAF more fully devoted to its success on the ground may have merit. This might be the right choice for all customers, but it’s one worth considering for Canada.
Excellent discussion and conclusion. To further the discussion, why does everyone discount (or not mention) the capabilities and costs associated with the Saab Gripen? Is our arm twisted to always buy American?
Posted by: Andrew Jones | 02 October 2013 at 20:39