Canadian Defence Review
April 6th, 2011
Title: L-3 Communications leads the way
Subtitle: Land, sea and air capabilities make it CDR’s pick as country’s number one defence contractor
The pounding that Canada’s six F-18 fighter jets have been inflicting on Libyan forces as part of the UN’s establishment of a no-fly zone in this Mediterranean nation, initially came across in many media reports as routine enforcement operation. It was anything but. As US secretary of defence Robert Gates acknowledged, attacking a sovereign nation is an act of war, and, as a result of the fog that such conflicts bring, the stakes were high.
The stakes are also high for L-3 Communications and its L-3 MAS division, which has been handing modernizations conducted on the aircraft. Defence stakeholders are watching closely to see how the most recent round of 200 or so systems improvements that the company installed, which are supposed to keep the CF-18 fighter fleet in service until 2020, will perform under fire.
According to Richard Bastien, vice-president (business development) at L-3 MAS, the CF-18s, which form Canada’s primary offensive capabilities, would probably not still be in the air, had it not been for those incremental modernizations. “Many of those planes have been around for almost 30 years and were scheduled for retirement in 2005,” notes Bastien. “Not only have the changes we made extended their useful life, they will be extremely valuable in their current combat missions.”
Canadian Defence Review agrees. As a result of L-3 Communications’ work on the CF-18s and a slew of other mission critical air, land and sea systems that it supplies, as well as the company’s size, breadth and diversity, technological sophistication and future growth opportunities, we have named it Defence Contractor of the Year.
According to Peter Gartenburg, L-3 Communications vice-president (Ottawa operations), the company’s work on the CF-18s, arguably Canada’s most daunting offensive weapons, represents only a part of its Canadian operations, which employ close to 2,300 people, many of them highly skilled and specialized professionals that are based in six plants and numerous other locales spread across several Canadian provinces. In addition to L-3 MAS, these also include L-3 MAPPS, Wescam, L-3 CMRO, L-3 Targa Systems, and L-3 Electronic Systems. “Size matters,” says Gartenberg. “A lot of people only know L-3 Communications through the parts they touch, and are often very surprised at the range of defence, public safety, C4ISR, and civilian products that we supply.”
These wide ranging capabilities make L-3 Communications an ideal in-service support partner-provider for foreign suppliers in the vehicle and other industries says Gartenburg. “Our size also gives us the flexibility to do things that many SMEs simply cannot do to the same degree, such as spreading sub-contracting work across the country (important in meeting industrial regional benefits requirements), participating in industry associations, and giving government feedback and input.”
L-3 MAPPS: a global centre of excellence
One of the key reasons for L-3 Communications’ success notes Wendy Allerton, regional director (sales and marketing) at L-3 MAPPS, stems from the synergies created from being part of a global defence sector powerhouse. “We have developed several centers of excellence here in Canada that enable us to produce top of the line products that we can export around the world,” notes Allerton. “However we also have the flexibility to draw on a global network of talent and technologies.”
Allerton isn’t kidding. L-3 Communications group as a whole, includes more than 80 companies and 67,000 employees that generated $15.6 billion in revenues during 2009. L-3 MAPPS, which has a head office in Montreal, and operating units in the US, the UK, India and Malaysia, supplies control and simulation tools for the marine, power generation and space sectors.
Allerton credits this flexible structure for many of L-3 MAPPS’ achievements, particularly those related to its Integrated Platform Management Systems (IPMS) which is currently used on Canada’s frigates, submarines, ORCA class patrol vessels, Iroquois class destroyers as well as in 150 ships and submarines in 18 navies around the world.
In fact, L-3 MAPPS’s marine controls for systems such as propulsion, ancillary and auxiliary machinery, and electrical generation and distribution, provide a prime example, of how sophisticated technological improvements, to non-weapons systems, can make a huge difference in overall naval productivity. “L-3 MAPPS is a great Canadian success story,” says Allerton. “We started with just a $3.4 million contract under the old SHINMACS (Shipboard Integrated Machine Control Systems) and from that have built capabilities which translated into billions of dollars worth of exports.”
Another L-3 Communications division that has seen particularly strong growth in recent years has been L-3 Communications WESCAM. The company, which has center of excellence is based in Burlington Ontario, produces turrets and stabilization systems mostly for air vehicles such as planes, helicopters and UAVs, as well as custom lens assemblies and solutions for the live sports coverage industry.
According to Allan Bignell, its vice-president and general manager L-3 Communications WESCAM has expanded its product line to include more (and bigger turrets) which it now produces in 10”, 15” and 20” variants, which can hold up to ten electro-optical, infrared and active laser sensors, ranging from wide-area to zoom cameras, illuminators, range finders and targeting designators. “It’s been pretty hectic around here,” admits Bignell, who joined Wescam in 2002, after obtaining a Ph.D. in electrical engineering and doing a stint at CAE.
The company sometimes sells the turrets alone, but it also supplies integration support and systems integration capabilities. Increasing use of information-centric warfare has driven demand for its products at a rate of 20 percent compounded growth for the past several years. During that time staffing has shot up from 525 people to close to 800. One big recent change says Bignell, has been WESCAM’s renewed emphasis on supplying ground systems, such as those that could be used in the upcoming LAV III upgrades.
L-3 MAS: the sharp edge
Of course L-3 Communications biggest challenge has been keeping those 80 CF-18s in service, says Bastien, an accomplished ex-military officer who did a 32-year career in the Canadian Air Force where he ended up as second in command, prior to joining L-3 MAS. Bastien bills the division as the country’s “leading provider of aircraft feet management, product life-cycle extension, and in service support services, to government departments, agencies and military customers.”
In addition to those CF-18s, L-3 MAS, which employs 1,000 people at its operating facilities in Mirabel, Cold Lake, Bagotville, and Shearwater, also provides extensive fleet maintenance, fatigue management, engineering and maintenance for the Australian Air Force’s F/A 18s at a base in Williamstown in the land down under. In addition, the company’s win of a contract to provide in-service support for Canada’s new CH-148 Cyclone marine helicopters is also expected to keep it busy during the years to come.
So far, L-3 MAS has completed two major rounds of modernizations on the CF-18s. The most recent round saw the company incorporate kits supplied by Boeing which included highly sophisticated avionics systems into the aircraft. These kits included a Joint Helmet Mounted Cueing System (JHMCS), a Multifunctional Information Distribution System (MIDS) a Multi-purpose Display Group Upgrade (MDGU) color displays, and a Cockpit Video Recording System Upgrade. Shipments of the upgraded aircraft wrapped up early last year, and according to Bastien, the company is already gearing up for a third round of modernizations.
The elephant in the room at L-3 MAS, when any discussion about the CF-18s takes place, is Canada’s plans relate to its proposed acquisition of 65 Joint Strike Fighters. Much of the deal remain shrouded in mystery, including its proposed cost (which a recent independent estimate pegs at $30 billion, $12 billion more than government officials originally projected) and plans related to in-service support that will be conducted on the fighter.
However Bastien has some ideas about what should be done.
“Being the center of excellence for fighter sustainment here in Canada, MAS intends to pursue that role well beyond 2030,” says Bastien. “As a result we are going to work very hard to get involved with JSF, by adding value in whatever capacity we can.”
Ready for a “three-peat?”
Yet despite the company’s recent success, no one at L-3 Communications is resting on their laurels. “We think that the future is pretty bright,” says Gartenburg. “In fact there are many projects in the works at the Department of National Defence that we are ideally suited to participate in. So hopefully we’ll be around for a long time to come.”
Programs that L-3 Communications are bidding on or positioned to contribute to include the Tactical Armoured Patrol Vehicles, Light Armoured Vehicle (LAV) upgrades, Fixed Wing Search and Rescue Aircraft, JUSTAS UAVs as well as naval programs ranging from the Canadian Surface Combatant, the Arctic Patrol Vessel, Joint Support Ships and several others.
With that big potential “to do” list, it would thus be no surprise, if L-3 Communications, which was the first company to be selected twice by Canadian Defence Review as the country’s top defence contractor (the first time was in 2006) wasn’t also at some point in line to “three-peat.”
Name: L-3 Communications.
Major products: Aircraft modernization and maintenance, C4ISR, electronics systems, homeland defence products, systems integration
Key contacts: Peter Gartenburg
Canadian locations: Montreal, Mississauga, Ottawa, Trenton, Burlington, Don Mills
Number of employees (in Canada): 2,300
Number of employees (worldwide): 67,000
Sales (worldwide): $15.6 billion (2009).
Peter Diekmeyer Peter@peterdiekmeyer.com, is Canadian Defence Review’s Quebec Bureau Chief.
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