British design first to be submitted in Canadian navy's warship contest

Companies vying to design and help build the navy's new frigates began submitting their bids on Monday, as federal officials acknowledged there could be a production gap at the shipyard doing the construction.

British warship manufacturer BAE Systems — which is partnered with Lockheed Martin Canada, CAE, L-3 Technologies, Macdonald Dettwiler and Associates Ltd., and Ultra Electronics — pitched their Type 26 warship design.

They were first out of the gate on Monday, three days ahead of the revised deadline established by Public Services and Procurement Canada.

At least one other company among the 12 pre-qualified bidders is thought to have submitted its proposal for the program, which is estimated to be worth $60 billion over the next few decades.

"We're really excited," said Rosemary Chapdelaine, president and general manager of Lockheed Martin Canada, in an interview with CBC News.

Her company's pitch is the culmination of five years work and preparation.

More hurdles ahead

Senior public works and defence officials said the bids will pass through a series of hurdles over the next few months, but it will now be "later in 2018" before the federal cabinet has the chance to approve a winner.

The fuzzy timeline means the program is months behind schedule.

The design competition was launched over a year ago with the Liberal government saying the plan to select a foreign, off-the-shelf design would be cheaper and faster than building a warship from scratch.

The delay raises the spectre that there will be a gap between construction of the navy's Arctic offshore patrol ships and the frigate replacements, which are expected to begin construction in the early 2020s.

Such a pause between major projects would have a huge impact on the roughly 2,700 workers at Irving Shipyards Inc. in Halifax, and also flies in the face of the intention of the federal government's national shipbuilding strategy, which was to eliminate the "boom and bust" cycle in the industry.

Lisa Campbell, the assistant deputy minister of defence and marine procurement, said at the moment the start date for "cutting steel" on the surface combat ships is "highly speculative."

Kevin McCoy, the president of Irving Shipbuilding, said the company is exploring options to fill the gap by constructing more arctic ships, possibly for other nations.

"We're out there looking at what other interest is out there for the Arctic Offshore Patrol Ships," he said. "We've had some other countries come to the shipyard over the last two years. So, I would say: Yes it's an issue. It's an issue that most nations that build ships go through."

McCoy said it is "way too early" to speculate on whether there will be layoffs.

It is a matter of not "losing the experience of a highly talented workforce," he said Monday during a technical briefing in Ottawa. "The good news is we're looking at this many years in advance."

Type 26 frigate

The federal government, in laying down the markers for the program, said it was interested in an existing warship design, something with a proven track record.

The Type 26 only began production in Britain earlier this year.

Gary Fudge, the vice president of Canadian Naval Systems Programs at Lockheed Martin Canada, said the exact wording of the government's request for proposals was that it wanted a "mature design."

He said his company conducted two studies before partnering with BAE to submit the bid — and the fact that it was a brand-new design brought a lot of benefits.

"That is the best ship for Canada," Fudge said. "Some of these other warship designs were built 10 years ago and you will not be able to buy one part for those ships today."

Having to produce specific parts in small quantities will, according to Fudge, make some of the other, older designs more expensive.

The federal government will not confirm how many bids it receives between now and the time the decision is made, Campbell said.