Royal New Zealand Air Force

[ngatimozart]

I have looked up a few web sights in regard to this announcement and the basic source is quoted as Airbus. This does not mean that the deal is safe in the winding, often corrupt coarse of Indonesian politics at this stage, however if the source is correct one could assume that the price is in the right ball park. I know Ngati, an awful lot of "IFs".
The item does throw into perspective the costs of military programs and I have felt that a lot of the estimations on this site for our up coming programs have been significantly on the low side. I don't see a significant surplus being available from the $20b program

The important thing to remember is that different govts have different ways of accounting for things and allowing for things in aircraft and defence acquisition, plus they could have different variants ordered. Procurements systems and govt accounting systems vary from nation to nation.

Note that the $20 billion includes $1.7 billion for infrastructure so that would suggest that the possibility exists any future infrastructure requirements related to the FAMC may be already taken into account. How I have costed the A400M is based on official French govt figures: Projet de loi de finances pour 2013 : Défense : équipement des forces (in French); Senate of France. Then I add 50% to the flyaway cost: Air Transport Capability Options Briefing to Ministers 7/11/2014,para 13, pg 3. So based on those figures you are looking at around NZ$1.8 billion.

 

[gf0012-aust]

The important thing to remember is that different govts have different ways of accounting for things and allowing for things in aircraft and defence acquisition, plus they could have different variants ordered. Procurements systems and govt accounting systems vary from nation to nation.

Note that the $20 billion includes $1.7 billion for infrastructure so that would suggest that the possibility exists any future infrastructure requirements related to the FAMC may be already taken into account. How I have costed the A400M is based on official French govt figures: Projet de loi de finances pour 2013 : Défense : équipement des forces (in French); Senate of France. Then I add 50% to the flyaway cost: Air Transport Capability Options Briefing to Ministers 7/11/2014,para 13, pg 3. So based on those figures you are looking at around NZ$1.8 billion.

yep, australia for example includes additional acquisition costs such as facility changes, runway mods, + proper through life accounting. we even had the USAF come over to see how we did it as our costing procedures were seen as more accurate in the long run

the hardware seller only includes platform acquisition and acquired support - it doesn't include a proper through life estimation, so its costs will never be reflective of actual costs to the purchaser

the other thing that gets left out is software maint - they are usually renewed and maintained in blocks of years - so every couple of years there will be huge (and some are really huge) licensing sustainment costs that get added on. no shortage of examples exist where ongoing licensing had not been factored in and all of a sudden there is an alarm bell going off

add in contingency costs - which on major platforms can be 50% of the arrived cost and you can see how quickly things can blow out

and finally there are exchange rate variations which are calculated by Treasury. for example AUD to USD has gone from 65c to parity in a 10 year period.

NZD to Euro over a 10 year cycle has fluctuated from .4 to 1.5 - so you can see how contingency funds just on the echange rate would have taken a hammering

 

[Novascotiaboy]

Rob c I am with you and your suggested outcome. Embraced KC390 x five for the legacy C130 replacement and two, hopefully three, Kawasaki C2 for the B757 replacement.

The existing hangars should accommodate the KC390's without any changes as it is one foot less in height.

The C2 is ten feet taller so I am not sure if the existing hangars would accommodate the C2. C2 is five feet taller than the Boeings.

 

[Rob c]

The important thing to remember is that different govts have different ways of accounting for things and allowing for things in aircraft and defence acquisition, plus they could have different variants ordered. Procurements systems and govt accounting systems vary from nation to nation.

Note that the $20 billion includes $1.7 billion for infrastructure so that would suggest that the possibility exists any future infrastructure requirements related to the FAMC may be already taken into account. How I have costed the A400M is based on official French govt figures: Projet de loi de finances pour 2013 : Défense : équipement des forces (in French); Senate of France. Then I add 50% to the flyaway cost: Air Transport Capability Options Briefing to Ministers 7/11/2014,para 13, pg 3. So based on those figures you are looking at around NZ$1.8 billion.

I think 50% is probably too low. Looking at your french paper I noted that the NH90 was costed at $NZ42.7m and the A400m at $NZ 227.66m or about 5.3 x higher. while these are 2014 figures and probably cannot be directly linked, I think you would find a A400m by would easily be in the $2b to $3 b class as our NH90 deal was a decade ago and costs would have risen significantly since then.

 

[kiwipatriot69]

Indeed. I know its wikileaks I'm quoting, but having just read a article on the KC390 just now, its states the aircraft is a front runner and a decision will be made sometime mid 2017 by NZ. Is this hyperbole from Embraer?

 

[gf0012-aust]

Indeed. I know its wikileaks im qouting, but having just read a article on the Kc390 just now, its states the aircraft is a front runner, and a decision will be made sometime mid 2017 by Nz ? Is this hyperbole from Embraer

yep, because they would have no idea - and if it was challenged as a leak by any competing bidders they could scuttle the entire tender process and seek to recover damages

it doesn't hit the press, but I know of instances where there has been a bees dique chance that a challenge was about to be exercised for that very reason

 

[MrConservative]

Unlike Indonesia we will not be looking at manufacturing the aircraft locally. Part of the Indonesian deal with Airbus includes a technology transfer that will possibly see 3 of 5 aircraft assembled by PT Dirgantara Indonesia in Bandung following the first two assembled in Seville with more locally built if ordered.

If one is looking for guidelines around how much it will cost NZ - the UK 'package' is informative.

 

[ngatimozart]

I think 50% is probably too low. Looking at your french paper I noted that the NH90 was costed at $NZ42.7m and the A400m at $NZ 227.66m or about 5.3 x higher. while these are 2014 figures and probably cannot be directly linked, I think you would find a A400m by would easily be in the $2b to $3 b class as our NH90 deal was a decade ago and costs would have risen significantly since then.

That 50% is what the MOD, NZDF and the government use. The link I gave is to an official document which was part of advice given to the Cabinet by the MOD and NZDF regarding the possible C17 acquisition.

Past experience with aircraft purchases suggests that up to an additional 50% can be added to the aircraft price to account for essential equipment not included within the basic price, spares, initial support, training aids (such as simulators), infrastructure and other overhead costs associate(d) with introducing a new capability. Source: Air Transport Capability Options Briefing to Ministers 7/11/2014,para 13, pg 3.

Now are you claiming to know more than the officials who know what the actual costs do? Do you have access to the actual costs and what the individual line costs are? Have you read the FAMC and FASC documents? Now base your claims on actual verifiable figures or basis of fact. If you cannot don't make wild unverified unjustified claims based on little or no evidence. Dial back the attitude.

 

[bob23]

That 50% is what the MOD, NZDF and the government use. The link I gave is to an official document which was part of advice given to the Cabinet by the MOD and NZDF regarding the possible C17 acquisition.

Now are you claiming to know more than the officials who know what the actual costs do? Do you have access to the actual costs and what the individual line costs are? Have you read the FAMC and FASC documents? Now base your claims on actual verifiable figures or basis of fact. If you cannot don't make wild unverified unjustified claims based on little or no evidence. Dial back the attitude.

ngatimozart, as an impartial observer I see no attitude on Rob c's part on this page and it seems to be you that needs to dial back the attitude..

 

[Rob c]

That 50% is what the MOD, NZDF and the government use. The link I gave is to an official document which was part of advice given to the Cabinet by the MOD and NZDF regarding the possible C17 acquisition.

Now are you claiming to know more than the officials who know what the actual costs do? Do you have access to the actual costs and what the individual line costs are? Have you read the FAMC and FASC documents? Now base your claims on actual verifiable figures or basis of fact. If you cannot don't make wild unverified unjustified claims based on little or no evidence. Dial back the attitude.

Ngati, I was only using the figures from the link "you" provided (changed from euro's to NZ Dollars at today's rate)and referring them to the NH90 program as a reference point. I did make a personal point that I thought that the price would be in the $nz2 to 3b mark. There was nothing that I consider as wild and unjustified, just some simple arithmetic. Your comment on attitude is what I consider unjustified.

 

[gf0012-aust]

all, pause, count to 10 and take a deep breath

its the internet - not the kind of thing to publicly have conniptions about

as an observation, I did get the sense that the thread was well on the way to emulating some of the RAN posts of the past - ie it may not have been going around in circles, but it was starting to look like a mobius strip.....

 

[MrConservative]

If one is looking for guidelines around how much it will cost NZ - the UK 'package' is informative.

A lot of the information about the A400M's entry into RAF service and the budgets involved are available publicly through the UK Parliaments website as a matter of record via questions to the respective Ministers and parliamentary committees. It just involves a little bit of patience, searching and cross-referencing.

These will give an idea of what the RNZAF will require. It is all hard facts and data - not guessimates. It is probably closer to the mark than using a brief Jane's report about the Indonesia purchase that does not include any substantive detail on the proposed contracts surrounding tech transfers and future build rights which can dramatically boost costs beyond typical sustainment and support costs.

 

[Rob c]

Rob c I am with you and your suggested outcome. Embraced KC390 x five for the legacy C130 replacement and two, hopefully three, Kawasaki C2 for the B757 replacement.

The existing hangars should accommodate the KC390's without any changes as it is one foot less in height.

The C2 is ten feet taller so I am not sure if the existing hangars would accommodate the C2. C2 is five feet taller than the Boeings.

For info, the current aircraft all have low tail planes and are accommodated in the hangars by the use of a tail slot for the fin above the doors, the freight contenders for replacing them all have "T" tails that would not fit the current slots. Interestingly there is a current tender out to replace the slots at WH. How significant this is I don't know. I do know from a briefing I attended back in the 1960's, by the hangars designer that the complete front of the concrete hangars was made non structural so that higher doors could be fitted.

 

[gf0012-aust]

It is probably closer to the mark than using a brief Jane's report about the Indonesia purchase that does not include any substantive detail on the proposed contracts surrounding tech transfers and future build rights which can dramatically boost costs beyond typical sustainment and support costs.

Out of necessity I've had to deal with IHS (they own what was the old Janes publishing entity) over various issues and information reqs

although they have some really useful datasets and databanks, their main benefit is that its pulled and scraped together better than most other OSINT sources with a commercial front end.

they don't get access to any commercially sensitive material and they certainly don't get access to any credentialed material.

In actual fact they get material by vendors that is cleared for release and is by necessity deliberately inaccurate. (platform performance specs are the obvious ones), empirical measurements such as those that can't be challenged such as external dimensions are correct, weapons systems performance detail where the system is in service is incorrect unless cleared into the public domain

and I do know of instances where they have been given material which is tarnished in accuracy for a variety of vested reasons.

when equipment is being assessed, they attempt to make quality guesses - the risk to any country that qualitative data is released to entities such as IHS is huge, no-one wants to see a project cancelled due to a breach and an almost guaranteed legal pursuit by aggrieved parties seeking compensation for a compromised process.

if you consider that large platform submissions can cost a company between $5m and $10m to submit (with no guarantee of success) then you can understand why they would seek any excuse to defend their contribution to their shareholders and send a message.

so my view is that as good as IHS data can be, its not a trusted source. The private govt provided versions of IHS/Janes are however a different dog in the pound (such as their counter intel products) as the data is sourced from already credentialed and trusted sources.

acquisition and selection info however is a finger pluck + analysis off of uncredentialed sources

 

[kiwipatriot69]

Is what currently is set aside for the Hercules replacement set in stone, or would govt be willing to adapt to currency fluctuations and other cost increases,to ensure we have the right numbers?

 

[ngatimozart]

Is what currently is set aside for the Hercules replacement set in stone, or would govt be willing to adapt to currency fluctuations and other cost increases,to ensure we have the right numbers?

We would hope that they would allow for currency fluctuations, cost increases etc., but personally I have my doubts.... although with the $20 billion over all CAPEX there should be some room for movement. It will all depend upon who has control of the purse strings at the time the final tender offer goes before Cabinet for approval to accept the offer.

 

[RegR]

My attitude is, tthe more pacific countries operating A400m , the merrier. i wonder what our relations are like with Indonesia though. Good to get an idea of what it might cost Nz as we are replacing five hercules, like for like as the white paper said. With the exchange rate being 70 cents to the US dollar, thats 2.6 Billion of our 20 Billion Budget though.


Strategic to look at shortly after.Will that means less airframes? as it was 2 billion budgeted for the replacement,in that case id rather we go for a C2 Kawasaki or KC390 if the price is right and keep the numbers of airframes up.

Like for like does not nesscessarily mean numbers, merely capabilty, so if say it can lift 1.5x more, have a better availability rate, increased performance envelope, cover more options etc etc than these can adjust the fleet size accordingly to acheive the most required outputs at a similar level. A good example was the NH90s, 8 for 14 hueys, less overall numbers but still considered an improvement or at the very least maintained capability in most respects.

Numbers do still hold importance in it's own right however especially the smaller fleets as other issues arise such as availability, workload and maintanence.

 

[kiwipatriot69]

To cut an already small fleet of airlift from 5 tactical and two Strategic further, surely that would set a dangerous precedent, even with the added capability, where we at times would have no planes available for an emergency? After all, look at all the HADR missions we diid just last year,not counting disaster relief in our own country, and exersizes abroad. I would actually like a few extra NH90 if it could be managed within the budget too, for that reason.

 

[MrConservative]

To cut an already small fleet of airlift from 5 tactical and two Strategic further, surely that would set a dangerous precedent, even with the added capability, where we at times would have no planes available for an emergency? After all, look at all the HADR missions we diid just last year,not counting disaster relief in our own country, and exersizes abroad. I would actually like a few extra NH90 if it could be managed within the budget too, for that reason.

There has been no consideration about numbers being cut other being speculated here. I do not see how speculation serves any great purpose. My expectation is that there will most likely be 5 aircraft acquired in the Tactical role and 2 aircraft acquired in the Strategic role for 40 Squadron, in other words like for like - one new airframe replacing another in their respective role, with each of these new types coming as close as possible to meeting the expectations of the RFI and Government policy.

 

[ngatimozart]

Just an update on aircraft planned withdrawal dates.

• C130H 2020 - 22
• B757 2025
• P3K2 2025

That is from the latest RFI issued; this one is the RFI for Communications, Navigation, Surveillance and Air Traffic Management (CNS/ATM) Sustainment Project (Tranche One).

1. Reference A* outlines the New Zealand Government’s plan for modernisation of New Zealand airspace. These changes will form part of a world-wide update to the regulatory environment and the New Zealand Defence Force (hereafter “Defence”) is investigating the changes that may be required to be incorporate in its aircraft to comply with Ref A; as well as investigate changes in military Identification Friend or Foe (IFF) capability being introduced by nations New Zealand has historically operated with.
2. Notwithstanding the need for Defence to comply with the reformed New Zealand airspace requirements there is also a need to comply with similar air traffic management reforms in the European and US airspace environments.
3. Defence seeks information on potential solutions to upgrade the Communications, Navigation, Surveillance and Air Traffic Management (CNS/ATM) capabilities of its fleet of six P-3K2 Orion aircraft, five C-130H(NZ) Hercules aircraft and two Boeing 757-2K2 aircraft. The affected capabilities include the combined military and civil aircraft identification systems; and, in the case of the Boeing fleet, commercial SATCOM system.
4. The upgrade will be achieved through the modification and/or introduction, as required, of IFF/ADS-B/SATCOM equipment including Mode 5 Mission Planning equipment) and software into the aircraft fleets within scope.
5. The CNS/ATM Sustainment Project has been split into two tranches:
a. Tranche One covers the Defence fixed wing fleets as defined in this RFI.
b. Tranche Two covers rotary wing fleets (A109, NH90 and SH-2G) which will be treated under a separate RFI.
* New Southern Sky (New Zealand National Airspace and Air Navigation Plan) of June 2014 (available at New Southern Sky)

So it looks like the Orion withdrawal date has been bought forward 2 years from that originally planned and they are upgrading existing aircraft capabilities as per the RFI above.

On a historical note, video of the 1992 Auckland Air Expo at Auckland Int Airport. Has footage of the SE-5A crash, BDA-5 nose gear collapse on landing, Beriev A-40, IL-76 Candid, RAF Harrier, RNZAF A4K, RNZAF MB-339CB, RNZAF UH-1H and other assorted aircraft.