SAAB CEO confirms discussions with Bombardier, gives more details on Canadian offer

Another day, another info dump from Saab. As we rapidly approach the Swedish delegation visit to Canada, Saab is hard at work to detail their proposal for a Canadian Gripen order. This was reported in the Globe and Mail, who have done a good job at being able to reach the company, even visiting their headquarters.

We still have a lot of unknowns. Saab has not presented their full plan, nor has the government spoken openly about what was offered. However, the company has given tidbits of information.

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Saab is in active talks with the federal government and Bombardier about producing the Gripen fighter jet under licence in Canada.

This would involve full technology transfer, allowing Canada to carry out:

• Final assembly

• Upgrades

• Component manufacturing

• Testing

• Long-term lifecycle support

There is no word yet on if Saab will be working with partners like Leonardo to secure the IP of other critical components such as the ES 05 Raven radar or Skyward G IRST. Saab estimates that this partnership would lead to upwards of 10,000 Canadian jobs, which would be created through:

• Assembly

• Component manufacturing

• R&D hubs

• Spinoff technology programs including drones

Saab had previously promised four such research facilities in their original bid:

• A Saab Sensor Centre to be based in Vancouver along with a new Space Surveillance Radar system

• A Cyber Security Resilience Centre to be built in Toronto

• The Gripen Centre, a hub for supporting and sustaining Gripen in Montreal

• An Aerospace Research Centre, also based in Montreal, tasked with developing, testing and producing next generation aerospace systems and components

Of course as of now we have no confirmation on if these are in the plan. However, they are a good base to look at when the topic is raised. As of right now, only Bombardier has been a confirmed partner with IMP and CAE also named.

Other partners likely to be included are GE, Arcfield, Magellan and StandardAero, as all were included in the first proposal. It is reasonable to assume many will return this time around. Although the shift to Bombardier has caused many to guess, I do not see many of these other partnerships shifting given their niche roles on the supply chain, primarily around the GE 414 engine.

Although Saab is not the only one lobbying here. The government of Ontario has been stealthily moving to secure as much offset as possible from a potential Gripen deal. The Ford government has been in discussions with Bombardier about possible production in Ontario instead of Quebec.

Quebec is expected to land this in a hypothetical deal, however Vic Fedeli, Ontario’s minister of economic development, job creation and trade, has met with Saab officials several times, including with Doug Ford, to discuss this topic along with other potential offsets.

The government has reportedly offered Saab incentives, both political and financial, in an attempt to lure their interest. Will that work? Unlikely. A lot of Saab’s proposal is centered around creating a Montreal cluster. They are trying though, with the expectation that this is going through.

Saab is promising that a factory could be set to produce in three to five years after a contract is signed. This would align to the last of a second F-35 batch delivering hypothetically. The thirty two to forty number for F-35 is accurate to what I have heard the last two weeks, but it is not the only number. There are multiple options on the table, including a full F-35 order still.

So I am hesitant to call it the likely number. I have yet to see an indication it is. It is just one potential option among several. I will keep trying to dig into this number over the next few weeks and see what I can find.

Saab is also suggesting that Canadian produced Gripens could be used to support Ukraine, although they have also promised Ukraine their own production facilities as well. The idea would likely be that the first batch or few come from Canada before shifting to full Ukrainian production.

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At this time I do not want to get fully into the economics, especially because it is not fair for me to assess when the whole picture is not available. Right now we have vague promises and some guessing, not enough to break anything down on my end.

I can however reiterate my concerns with this review because that is an ongoing problem I have. Since this review was launched in March we have gotten almost zero information about what is going on. We do not know the requirements. We do not know what is wanted. We do not know what anyone said. We have barely gotten any information at all.

We had a summer deadline that was completely forgotten even though I agreed that it should not have been set. It is still an example of how confusing and out of the public eye everything has been. How do I talk about something where we have no info and no one can get on the right page about anything.

It is the RCAF’s decision until it is not. It is going to come out at the end of the summer until it is not. It is going to be another competition until it is not. Almost every time somebody speaks about this project it ends up getting contradicted by somebody else.

If the aim is to be transparent then I cannot think of a worse example. If the aim is to be informative then I cannot think of a worse example, and this is not the only incident where we have seen this. We also saw very similar issues when it came to the Coast Guard.

It can be a bit frustrating for somebody like me whose job it is to analyze everything. How can I talk about things when nobody wants to talk about them. How can I accurately report information when ministers contradict each other. When everything is so convoluted and kept out of the public eye that even the small bits of information get treated like gospel.

And once information is out there, for those who do not know, it becomes incredibly hard for someone like me to bring up the fact that it is inaccurate. It is hard for me to go out there and say that this is not what actually happened or this is not what is actually happening.

That is why having clear and decisive information, especially at the government level, is so important. Once it is out there, it is very hard to get people to see any clarification or update. Not everyone will see every little update for a project or initiative.

Perhaps it is more of a personal gripe because this is what I do. However, I feel like I still need to bring it up because at the end of the day we all want a government that is going to be transparent and open about things.

We have a right to know as citizens what our government is doing, especially when we are talking about projects worth billions and billions of dollars that have billions of dollars tied in economic benefits and obligations. We deserve to know what is going on and what the government is talking about with manufacturers.

So to say I am a bit disappointed is an understatement. However, I will continue to fill my role as both an analyst and an investigator. I have a duty and a responsibility to all of you to get you as much of the accurate information as possible. It is my job and my role to clear the veil of secrecy that is currently existing on this project. I do not know how well I will be able to succeed in that. However, I am going to try my best.

Hopefully we will be getting some more information in the coming weeks. We certainly will be getting more as the Swedish delegation gets closer to visiting. Until then we deal with what we have and we look at what we are given until such time as things become clear.