Government awards $5.2 billion contract to service the Royal Canadian Navy Fleet

The federal government announced August 20th that it has awarded a $5.2 billion contract to Joint Venture of Thales Canada Inc. and Thales Australia Limited to service the Royal Canadian Navy’s (RCN) fleet.

“Modern ships, like the Joint Support Ships that will be built here in Vancouver, are essential to our fleet. They will deliver the capabilities that the Navy needs to meet defence and security challenges we face, both at home and abroad, and carry out the tasks required of a modern navy. This contract will help ensure that the women and men of the Royal Canadian Navy will be provided with reliable, continually supported ships for years to come,” said Defence Minister Harjit Sajjan when announcing the new contract.

Through this contract, it is anticipated that the RCN Arctic and Offshore Patrol Ships (AOPS) fleet and the Joint Support Ships (JSS) fleet will be receiving long-term in-service support, including refit, repair, maintenance, and training for the expected life of the vessels, approximately 35 years.

“Thales Canada’s best-in-class in-service support solution will drive Canadian innovation, create growth and ensure that ships are mission-ready, where and when they are needed. As the selected in-service support provider, Thales is committed to empowering Canadian industry to support the AJISS program for decades to come,” said Mark Halinaty, Thales Canada President and CEO.

The servicing will begin when the first Arctic and Offshore Patrol Vessel is delivered in 2018, and the first Joint Support Ship is delivered in 2021.

The five AOPS are currently being built by Irving Shipbuilding Inc. The two JSS are being built by Seaspan’s Vancouver Shipyards.

It is expected that in-service support and maintenance contracts will not only save taxpayers money but will ensure that the new ships are immediately ready for operations.

“The Government is giving our Navy the ships it needs, and we are taking steps to make sure that we have solid, cost-effective support in place to keep our fleet in full operational readiness. Canada’s National Shipbuilding Strategy is also revitalizing the shipbuilding industry, supporting Canadian innovation, and bringing jobs and prosperity to many communities across the country,” said Jim Carr, Acting Minister of Public Services and Procurement.

According to a Department of National Defence press release, the contract is expected to “create and maintain more than 2,000 middle-class jobs across Canada over a 35-year period, and grow the Canadian economy.”

“As a result of Thales’ economic obligations under the contract, the government’s Industrial and Technological Benefits Policy ensures that they will invest an amount equal to the contract value, in Canada. The application of this policy demonstrates Canada’s commitment to creating jobs, supporting innovation through research and development investments, developing technical skills and promoting the growth of the Canadian marine sector,” said Navdeep Bains, Minister of Innovation, Science and Economic Development.

Any in-service support work required to support and maintain the ships will be carried out in Canada unless a vessel needs maintenance overseas.