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I receive no fees, considerations, etc. etc. for the posts on this blog nor do I have any plans to accept any. My salary is paid by Canwest Global Communications Corp. I work for that company as the Ottawa-based National Affairs Correspondent for Canwest News Service.
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Re: Up, up and away in a C-17
by Mark Collins
Dear Mr Akin, I wonder where you get the $400 million per aircraft? Following costs are from Defense Industry Daily (2006): "The C-17 sale itself will be handled as a direct commercial sale rather than a foreign military sale, in order to facilitate the industrial offsets that its purchase requires. As such, the 4 plane order is unlikely to be announced by the DSCA. Based on Australia's recent order, the likely cost is around USD $180-200 million per aircraft. This proposed USD $1.3 billion sale of related equipment and support will involve various contractors, including: * Boeing in Long Beach, CA (C-17 builder) * Boeing Training Systems in St. Louis, MO * AAI Services Corporation in Goose Creek, SC (AVS-9 NVGs) * United Technologies in East Hartford, CT (F117 Engines) * Northrop Grumman Systems Corporation in Rolling Meadows, IL (LAIRCM) * Additional subcontractors may be needed depending on the exact nature of the contracting arrangements." So at this point that's about USD $500 million per plane if you add the support contract to the actual cost of the airframes. Then there's the life-cycle cost: "...Canada's entire program has a limit of about USD $3 billion." Perhaps you divided the first figure in this DND document by 4 and rounded down: "The estimated total project cost for this strategic lift aircraft acquisition is $1.8 billion, plus an estimated contract value of $1.6 billion for 20 years of in-service support..." But that $400 million figure, as the DID story above shows, includes a lot more than the cost of the airframe--and a lot less than if the in-service support were included. If all costs are considered one might say the price of one plane is $800 million. Lots of fun with figures, but it would be helpful if when you give these costs per plane you would make clear what is included, and what is not. Mark Ottawa
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