I think its likely due to the continual rise of the CND$ against the US$ and the expectation that it will continue to rise.

I expect the R&D costs would be reflected in the actual costs of the subs.

Its an unfortunate reality but one that most CND companies have to face. There's already talk of many job lay offs up here in B.C. in the logging industry by Christmas due to this very issue.

Jag