Canada has signed a non-binding term sheet with Saab that sets the scope for negotiations on six GlobalEye airborne early warning and control (AEWC) aircraft for the Royal Canadian Air Force (RCAF).

The federal government announced the agreement Sept. 25. That was four months after Prime Minister Mark Carney named Saab the preferred supplier for the capability at CANSEC in Ottawa. The term sheet is not a contract and does not commit Canada to buying aircraft.

What it does is set the agenda for the next round of talks: a Canadian configuration and development program, industrial participation and schedule. The government said the agreement reflects months of work among Saab, the Defence Investment Agency (DIA) and the RCAF.

"Entering into this agreement is an important and tangible step forward in our ongoing efforts to equip the Royal Canadian Air Force with the modern capabilities it needs to support operations," said Defence Minister David McGuinty.

The capability

Canada intends to acquire six aircraft along with their associated systems and training. GlobalEye combines Saab's Erieye Extended Range radar and a suite of active and passive sensors with mission systems on the Bombardier Global 6500, a business jet built in Canada.

According to the government, the aircraft would detect, track and prioritize threats at long range, including aircraft, missiles and drones. It would also serve as an airborne command and control centre. Ottawa links the capability to NORAD modernization, continental defence and greater reach in the Arctic and other remote regions.

"An Airborne Early Warning and Control capability will significantly strengthen Canada's ability to detect, track, and respond to threats to our territory and approaches," said Lt.-Gen. Jamie Speiser-Blanchet, commander of the RCAF. "It will be a key enabler of integration across our modernized force, connecting platforms, sensors, and decision-makers to provide a more complete operational picture."

Industrial stakes

Ottawa wants Canada to become a centre for future GlobalEye missionization and support work, building on the Canadian-built airframe. It plans to use the Industrial and Technological Benefits (ITB) Policy to secure work in missionization, in-service support, training, research and development, and supplier participation. Exports of Canadian-built aircraft are also on the list.

That approach follows the Defence Industrial Strategy and the government's "Build-Partner-Buy" framework. The framework gives priority to proven, off-the-shelf systems from trusted allies while seeking returns for domestic industry.

"Canada's approach to defence procurement must deliver more than military equipment. It must defend Canadians while strengthening our economy, growing Canadian industrial capacity, and opening new opportunities for Canadian companies to compete globally," said Stephen Fuhr, secretary of state (defence procurement).

When Canada named Saab preferred supplier in May, the company said it had offered to build, maintain and upgrade the Canadian fleet with Canadian partners. Saab has also extended its training and simulation partnership with CAE to cover the Canadian program.

"The term-sheet agreement reflects the strong collaboration between Saab and Canada and establishes a clear framework for the next phase of our engagement," said Micael Johansson, president and CEO of Saab.

Allied momentum

GlobalEye has picked up customers quickly this year. In July, NATO Secretary General Mark Rutte announced that 11 allies, including Canada, would jointly pursue up to 10 GlobalEye aircraft to replace the alliance's E-3 AWACS fleet.

The NATO negotiations run through the NATO Support and Procurement Agency and are separate from Canada's national program. The government's release lists NATO, Sweden, France, the Netherlands and the United Arab Emirates as having selected GlobalEye or intending to.

Open questions

Neither Ottawa nor Saab has released a cost, a contract date or a delivery schedule. The government describes the term sheet only as the foundation for detailed negotiations.

The selection has also drawn scrutiny. The Conservatives have written to the auditor general and the parliamentary budget officer asking them to examine whether the government followed proper processes in choosing the platform, The Canadian Press reported.