Did the Canadian government make the right decision in February 1959 to cancel the Avro Arrow project?
Author and publisher Marc-Andre Valiquette of Montreal says NO. Researcher and writer Russell Isinger of Saskatoon says YES.
Valiquette has written and published the four-book series Destruction of a Dream, The Tragedy of Avro Canada and the CF-105 Arrow. In 1997, Isinger completed his graduate thesis titled The Avro Canada CF-105 Arrow Programme: Decisions And Determinants. Both men continue to research and write on this controversial subject.
On Feb. 20, 1959, the John Diefenbaker Government announced its decision to cancel the Avro Arrow project. This resulted not only in the loss of a promising aircraft and turbojet engine; it was also the virtual disintegration of Canada’s aviation industry in the aftermath of what became known as Black Friday.
It is my view that this was, for many reasons, the wrong decision. Nothing since 1976, when I started my research on the subject, has changed my belief that this decision was a political/economic one and had absolutely no basis in continental air defence requirements as military authorities saw them. And for all the reasons given for the cancellation, not one has stood the test of time.
First, cancelling the project using cost as an excuse was distorted. The money spent ($347,669,537, including termination costs) should have been seen as a production investment which could only be justified or assessed on the basis of predicted future production. It should not have been applied against the small number of test aircraft on contract at the time (37), which all critics have used then and since. Furthermore, the Financial Post’s Sept. 20, 1958, front-page article titled Your Business and the Arrow’s Fate had estimated that the government was recovering close to 65 per cent of its expenditures on the Arrow through taxation.
Second, the ensuing layoffs dealt a severe blow to the Canadian aviation industry, which at that time was highly dependent on both Avro and Orenda. These companies had made a point of establishing Canadian sources of supply for their projects. Consequently, local firms had been introduced to many new techniques and processes, while large and talented design teams had been built up. Following the project cancellation, the contributions they made to Canada’s prestige and capabilities virtually disappeared. The annihilation of Avro based on circumstances created largely by the government clearly ran against the long-term industrial interests of Canada.
Third, termination not only meant that the CF-105’s full potential could not be demonstrated (32 Arrow Mk.2s were on the assembly line), it also curtailed the Iroquois engine’s final weeks of testing. The turbojet sale to Dassault of France to equip the Mirage 4 bomber (300 engines) was consequently not concluded. This alone would have generated $120 million in export sales and saved the Arrow project $40 million. By continuing the CF-105, the flight test portion would have been completed and some aircraft would have been used operationally by the RCAF. Information gathered from the flight testing and operational service would have been invaluable when used in sales pitches to Canada’s allies.
Fourth, acquiring the Bomarc missile for the RCAF was not the answer to all of Canada’s defence problems. American high-level government representatives sold the Canadian government and some high-ranking RCAF officers on the idea that the advent of missiles meant the obsolescence of all combat aircraft. Although cheaper than the Arrow and funded almost entirely by the U.S. ($91 million out of a total of $110.8 million), the Bomarc would prove to be useless against manned bombers only a few months after being acquired. And to be effective, the missile had to be armed with nuclear warheads which Diefenbaker refused to use. In hindsight, the government’s conclusion that manned aircraft were becoming obsolete was obviously inaccurate, short-sighted, and absolutely wrong in every respect.
In the end, a great deal of the Canadian air force thinking had been predicated on the assumption that their budget was going to be restricted and therefore they could not acquire the Arrow and other military equipment. This unnecessary restriction dominated a lot of their deliberations and influenced their recommendations unfairly, since the budget envelope was not for the air force to determine. They should have stated their requirements to meet the military challenge, and leave the politicians to decide how much money would be budgeted in response. It is only by clearly defining requirements to meet anticipated defence threats that adequate funds will be secured to address them. If the initial assumption is that funding is inadequate, there can only be continuous retreat as the politicians dictate compromise and always scale back.
In 1959, Canada failed to appreciate the tremendous lead it was enjoying in military aerospace technology when it cancelled the Arrow. With Avro’s demise, the country forever lost that lead, together with the export dollars it could have earned. It was the wrong decision.
Though he can be faulted for temporizing, Conservative Prime Minister John Diefenbaker made the right decision when he canceled the CF-105 Avro Arrow program in 1959 (and the Liberals would have done exactly the same thing if re-elected in 1957).
The Arrow’s demise was the inescapable consequence of harsh financial realities, coupled with a flawed weapons acquisition process driven by an overly ambitious RCAF, as well as dramatic strategic shifts internationally.
The decisive factor leading to cancellation was escalating cost, largely attributable to RCAF’s rapid expansion of the project to four advanced systems developed concurrently: the Arrow airframe, Iroquois engine, Sparrow II air-to-air missile, and Astra radar and electronics system.
The company, essentially an arm of the RCAF, had a “cost-plus” contract and little incentive to curb costs, and its only customer demanded nothing but the best. Concern over costs vexed military and political decision-makers as defence budgets shrank after the Korean War. Inter-service rivalry arose, and the army and navy eventually turned on the air force—itself split between rival Norad vs. NATO procurement goals—leaving the military little option but to agree to terminate the project.
It was not that the Arrow was substantially more expensive than comparable Western aircraft; it was simply the case that a middle power like Canada learned it could not afford to develop such “gold-plated” modern weapons systems on its own.
Foreign sales might have achieved the economies of scale of a longer production run, but the Arrow was too closely designed to Canada’s needs to interest other countries; though the United States and the United Kingdom expressed admiration for the Arrow, they had their own aircraft industries to support.
The RCAF bears much of the blame for the way the project unfolded.
The service was good at advancing its organizational interests during its “Golden Age,” when it absorbed 50 per cent of the defence budget and their political masters were deferential to air defence experts. But the RCAF was less adept at actually managing its homegrown weapons acquisition process. The RCAF poorly assessed the technological and strategic (not to mention financial) horizon; they demanded technology beyond state of the art and tried to obtain it as quickly as possible while—fatally—employing concurrency; they proceeded in the absence of a coherent military-industrial strategy for the aircraft industry; they did not even set up a project office to oversee all aspects of the project until 1957.
In the final analysis, procurement was driving defence policy, and the RCAF rushed headlong into a prestige project that needed to proceed in a more orderly and thoughtful manner.
Skyrocketing costs and dysfunctional project management aside, the other key factor in the Arrow’s cancellation was the strategic flux caused by the rapid pace of missile development, driven home by Sputnik in 1957 (launched on the day of the Arrow’s unveiling).
The idea of defending against nuclear attack was quickly replaced in the West by the concept of deterring it. The steady growth in the significance of the missile, both as a threat in the form of ICBMs supplanting bombers, and as a means of defence in the form of SAMs like Bomarc (which the RCAF also desperately wanted), undermined arguments for a world-beating interceptor like the Arrow (indeed, there were politicians and generals who firmly believed—erroneously—that the missile would render manned aircraft obsolete). This led inexorably to an RCAF operational requirement for interceptors in 1959 a fraction of the 500 or more that had been anticipated in 1952—a quantity which did not justify setting up a domestic production line.
With its cancellation, the Arrow flew off into legend, where it will probably soldier on far longer than if it had actually entered service. As the contemporary political analyst James Eayrs wrote: “For a force for which the sky was the environment, rather than the limit, nothing seemed impossible… The cancellation of this project seven years later, after the aircraft had reached the prototype stage of development and more than a billion dollars [would have to be] spent on it, dealt to the prestige and morale of the Air Force a blow from which it never fully recovered. Pride led to hubris, hubris to the CF-105.”