Professional Documents
Culture Documents
59 66 Eng
59 66 Eng
59 66 Eng
AN EXAMINATION OF
THE ARMOURED PERSONNEL CARRIER
REPLACEMENT PROJECT
by Major J. Craig Stone
From a qualitative viewpoint, the APC fleets of the DPMS — project identification. Both the PPP and
have serious deficiencies in protection, firepow- the SCD are referred to in the Statement of Requirement
er, mobility and capacity. Protection levels (SOR) with November 1994 and January 1995 dates
against direct fire weapons, shaped charge respectively. 3
threats and mines have proven inadequate as
indicated by the necessity to enhance a number Those familiar with the intricacies of the military
of vehicles in UNPROFOR with gun shields and procurement process will understand the previous state-
modest applique armour. 1 ment, but many individuals do not understand all the
terminology and steps associated with equipment pro-
T
he deficiencies noted in the quotation above curement. As a first step, the reader must be aware that
are just some of the many problem areas any discussion of a recent or current procurement proj-
identified in an operational readiness report of ect must clearly identify which ‘process’ is being dis-
June 1994 for the current family of Armoured cussed — the new Defence Management System (DMS),
Personnel Carriers. To resolve the shortcom- or the old Defence Program Management System
ings, the Army initiated project L2637 Armoured (DPMS). For example, the APC replacement project
Personnel Carriers Replacement. The project was first began in 1994 following the rules and processes laid out
identified in the 1996/97 Departmental Part III in the May 1994 DPMS manual, or more likely, the
Estimates with an indication that $5M was to be expend- March 1995 version of the NDHQ handbook titled An
ed up to 31 March 1996. 2 The identification of funds in Introduction to The Defence Program Mangagement
the Part III Estimates implies a decision had been made System (DPMS), tenth edition (or, A Survival Guide for
by the government to support the project. As well, with- the DND Program Management Jungle). A project in
in the context of the Defence Programme Management the early stages of identification today would be
System (DPMS), the identification of funds implies both required to follow the process and procedures in the new
a Programme Planning Proposal (PPP) and a Statement
of Capability Deficiency (SCD) were completed. Both Major J. Craig Stone, an Artillery Officer, is completing a PhD in
of these documents are required as part of the first phase War Studies at Royal Military College.
Subsequently, the
MRCV Project Office
became the Light
Armoured Vehicle Project
Office (PMO LAV), and
parts of the MRCV proj-
ect have been imple-
mented incrementally.
The first vehicle to be
purchased was the Coyote
reconnaissance vehicle,
or LAV recce vehicle,
from General Motors
Royal Canadian Dragoons Coyote surveillance vehicles keeping a watchful eye over the Presovo Valley on the
boundary between Kosovo and Serbia.
Diesel Division in London,
Ontario. The acquisition
DMS manual. The new DMS manual reduces the number of the Coyote has been followed by the APC replace-
of steps in the process and accounts for many of the ment, which was approved by Treasury Board in
management renewal initiatives that were developed as December 1995. 8
part of the Defence 2000 programme.
Although it is not intended to review all the details
The intent of the this paper is to review the pro- of the SOR, it is important to note that the SOR is a
curement of the APC replacement, more commonly mandatory document, regardless of which process is
referred to as the Light Armoured Vehicle or LAV III. used, and provides much of the technical information
The paper will briefly discuss the requirements for a needed by all parties during actual negotiations for the
new APC, identify the differences from the normal contract. With respect to the APC, the SOR identifies
process, and then discuss the project itself. The paper the capabilities needed to meet both current and expect-
will conclude with some observations on the potential ed future threats, and the need for growth potential in
long term impact of the government’s decision to go to order to cater for future performance improvements.
a directed purchase.
Perhaps more importantly in this particular case, the
THE NEED FOR A NEW APC SOR for the APC replacement identifies the need for a
‘fit-for-purpose’ clause.
C o m b a t C a m e r a P h o t o b y : M C p l D a n i e l l e B e r n i e r, I S D 0 1 - 0 0 5 4 a
December, with Treasury
Board Minute 823590
dated 14 December 1995.
Both of these dates are
also reflected in the Part
III Estimates. The author
believes that the later date
for the Treasury Board
Minute simply reflects the
bureaucracy at work and
the overall time required
to move the appropriate
documents through the
bureaucracy after the gov-
ernment decided to proceed
with a directed purchase. LAV III on patrol in the desert of Eritrea.
Before discussing the details of the directed pur- Management System is intended to address many of the
chase, it is appropriate to make a few comments on the shortcomings identified by previous Auditor General
Department’s switch from the DPMS to the DMS. and departmental reports.
Understanding the intended flexibility with the new
process will make the decision to proceed with a direct- This new DMS system, based on a codified system
ed purchase appear more logical. of accountability and responsibilities, is much more
decentralized. Instead of large central reserves, it relies
THE MOVE FROM THE DPMS TO DMS on the preparation and implementation of approved
‘level one’ business plans for the implementation of the
●
the requirements, with a view to finding the opti-
mum option to be further defined in detail;
definition – activities leading to the creation of a
T he LAV III project charter indicates that the
Department believed a directed purchase was viable
in order to take full advantage of the commonality that
detailed plan, cost and risk estimate for the imple- existed with the LAV reconnaissance vehicle, including
mentation of the selected option; its sub-systems and logistics support. “This option rep-
● implementation – activities leading to the acquisi- resented the optimum solution to the operational
tion and delivery of equipment, infrastructure requirement, capitalized on the investments made to
and/or services which satisfy the requirement develop and procure the LAV-Recce system, and yielded
defined during the definition phase. This phase the most timely and economical solution.” 22
includes the management and monitoring activities
needed to ensure that the project delivers the The implementation strategy is to capitalize on the
required output within defined time and cost con- performance, schedule and cost benefits accruing from
straints; and the experience gained through the LAV Recce project
● close out – completion of the project and the com- development and implementation. As well, existing
position of the associated reports. 20 production lines for systems common to both will be
exploited to the maximum extent possible. 23 The intent
It is the integration with business planning and the was to acquire, field and support an initial order of
government’s EMS that is supposed to make the process 240 APCs for the Land Forces, with delivery starting
faster, less bureaucratic and more responsive to the in 1997 in accordance with the acquisition strategy
Target Dates
Milestones Project 96/97 97/98 98/99 99/00
Charter Estimates Estimates Estimates Estimates
Model contract released Oct 95
specified by the government. Significantly, the purchase the remainder of the 651 LAV IIIs. Option I to
approved acquisition strategy also reflects a change from purchase an additional 120 was approved in May 1998,
more recent major capital purchases. The Department and Options II and III to purchase 120 and 171 respec-
negotiated a price based on eventually purchasing 651 tively were approved in November 1998. 27
vehicles, but only agreed to an initial purchase of 240.
The government would exercise options to purchase The project is certainly being implemented in far
additional batches of 120, 120 and 171 at a later date. 24 less than the 6,280 days referred to by the Auditor
General when criticizing the old DPMS. While the first
Although there is no solid evidence to substantiate vehicle delivery date was changed from January1998
why the government decided on this method, it is com- to July 1998, this six-month delay is attributable to
monly believed that the government wanted to avoid the vehicle engineering taking longer than expected. 28 The
large commitment and related political issues associated Army has decided to acquire additional variants of the
with the EH-101 helicopter project. The issue is one of LAV III and, based on these new requirements, the last
perception. An announcement to purchase 240 LAV IIIs vehicle delivery date may have to move to the right,
at $2.2M each would appear to cost less than purchasing although current expectations are 2003. 29
651, regardless of an intention to purchase all 651 in the
long term. 25 Additionally, purchasing the vehicles in Before closing this section on the LAV III purchase,
groups provides flexibility for the government to two other issues need to be discussed: the costs associ-
acquire a smaller number if circumstances warrant a ated with the purchase of the vehicle, and Industrial and
change in funding at a later stage. Regional Benefits (IRBs). Both issues are always
important in major capital equipment purchases for the
The LAV III is an all-weather, day/night, state-of- Department of National Defence. Tables 2 and 3 pro-
the-art 8X8 light armoured vehicle. The Army consid- vide expenditure and cash flow data for the project as
ers it to be a key component of their leading-edge bat- identified in the annual Departmental Part III Estimates
tlefield systems as they enter the 21st century. 26 The between 1996-1997 and 1999-2000.
project milestones are provided in Table 1 on the pre-
vious page. Table 2 reflects the non-recurring costs for the proj-
ect, and Table 3 provides the costs associated with the
Since the original announcement to purchase 240 additional purchases above and beyond the initial 240
vehicles, the government has exercised the options to vehicles, plus associated support costs. The reader will
Costs and Cash Phasing associated with Costs and Cash Phasing associated with
Fiscal Year additional 411 vehs and support costs as additional 291 vehs and support costs as
indicated in 1998-1999 Part III Estimates indicated in 1999-2000 Part III Estimates
98/99 26,538 0
99/00 192,979 3,637
00/01 552,795 217,113
01/02 483,062 513,555
02/03 86,285 91,425
03/04 67,513 73,425
04/05 8,309 55,478
Total 1,417,481 954,451
NOTES
1. Canada, Department of National Defence, and $822.580M remaining in future years. the MRCV. Before the MCRV project there was
Project L2637 APC Replacement Statement of 3. Canada, Department of National Defence, the Canadian Combat Vehicle 90 and the
Requirement (Ottawa: DND June 1995), p. 2. L2637 Armoured Personnel Carriers Armoured Infantry Fighting Vehicle Project.
2. Canada, Department of National Defence, Replacement Project Charter (Ottawa: DND, 6. Alistair D. Edgar and Davis G. Haglund,
National Defence 1996-97 Estimates Part III 24 January 1996), p. 3. The Canadian Defence Industry in the New
Expenditure Plan (Ottawa: Canada 4. Project Charter, p. 1. Global Environment (Montreal & Kingston:
Communications Group, 1996), p. 160. The 5. Lieutenant-Colonel R. Carruthers, Project McGill-Queen’s University Press, 1995), p. 88.
APC replacement project is listed in the details Director L2637 Armoured Personnel Carriers 7. Interview, LCol Carruthers.
of the major crown project section. The summa- Replacement Project, interviews 26 March and 8. Part III Estimates, 1996-96, pp. 4-71.
ry indicates a forecast of expenditures of $5M 7 April 2000. LCol Carruthers has been with the 9. Statement of Requirement, p. 7.
to March 31st, $46M for the 1996-1997 period, Project Office since its inception in 1991 for 10. Statement of Requirement, p. 6.
JOINT CONFERENCE
19-21 October 2001
FROM FRONT LINE TO HOME FRONT:
THE IMPACT OF THE NEW PEACEKEEPING