Actual Cost of JF-17 and Indigenous Military Hardware

[graphican]

Hello Everybody,

I am in Surgical Instruments business and the item that costs me 10 bucks is sold for 30 bucks in the market. Taking lead from that, what do you think JF-17 and other home made militry hardware would be actually costing.

Wikipedia says Cost of JF-17 is estimated 15 Million Dollars but my point is it would be the export price. The production cost would be some where between 5-7 millions or even lesser.

Similarly, the J-10s that will be produced by PAC would be much cheaper than the price-tag we see out there over internet and a lot lesser would be needed to induct them than most of us are anticipating. What do you guys think?

 

[Skywalker]

Good query mate, but its a biz secret and the concerns would never disclose this. We can only guess.

 

[nightrider_saulat]

i think the actual manufacturing cost would be around 5-6- million

 

[TaimiKhan]

5-7 million is very less as production cost, atleast take it up to around 10 million or so.

Issue in high priced items & defence items is that the higher the production cost, minimum or less would be the margin to earn profit on it as it will become expensive and then you got competitors too.

The reason for low production cost on our side, lets suppose in Pakistan and China side are the low labor cost involved, which makes the production cost reduced to great extent. US manufacturer have to give wages in dollars, meaning on average if they have lets suppose 25 low level tech guys working on an aircraft and yearly each earns 70,000US$, it would come to 50*70,000= 1,750,000.00US$ cost for just wages. While on this side the 25 technicians kind of guys would be making at the most lets suppose even Rs. 10,000/- at the most per month making each earn Rs.120,000/- per year, so 25*120,000=3,000,000/- @ PKR Vs US$ of Rs.85/1US$ it amounts to approx 36,000 US$ wage per year for all the 25 technicians.

Just see the huge difference, US gives 25 guys 1,750,000 US$ per year as wages, while our 25 guys cost just 36,000US$, even if we double the pay and perks, at the max if it goes to 100,000/-US$, a difference of 1,650,000 US$ in the wage.

Other things aside.

That is why JF-17s cost would be less compared to wages, which as per my analysis plays a very important role in aircraft or defence related items.

Wages have been the reason for such huge outsourcing of services & other products from US or other western countries to India, China, Pakistan or other Asian countries.

 

[Super Falcon]

who but it at higer price any clue

 

[Hyde]

i can remember the actual cost about 12 million dollars when the contract for first 42 jets was signed (that was mentioned in the news).... So i believe 12 million dollars/aircraft for PAF and between 15-20 million dollars for export customers

 

[MastanKhan]

Hi,

The reason your product build for 10 sells for 30 is---it has been manufactured for a while---plus there is a big demand for your product.

For big ticket defence items, you don't make money on the product itself but rather on the accessories and after sales service.

Just like a 2010 honda accord lx automatic---the sticker price is $22550 in the u s----but if you were to buy the parts to build one from scratch---it would cost you approximately $55---60000 for the same car.

Does that make sense---to some it will, to others, it may not. The manufacturer makes profit on the equipment they would sell afterwards to keep it running at 110%. The plane itself is just an ends to the means.

Look at it this way----what if the plane was sold at zero profit---now is the company losing---absolutely not---. It has paid for the material to build the plane---it has paid the workers their wages---the corporate people are being paid----so even at zero profit the company is doing what it was originally supposed to do----create jobs---create employment---put a fighter interceptor in the air---put food on the table---now in this case, the JF17 for pakistan is a govt run company---if they have created 250-500 jobs---so are ahead of the game.

 

[fatman17]

the fly-off cost will be around US$15m/ac. add the weapons and ground infrastructure/equipment, the cost goes up to US$20m/ac - this is a very attractive 'price' for 3rd world airforces to get a modern 3++ generation a/c. later blocks of the JF-17 as it matures will take it into the 4th generation realm in about 3-5 years time. then the cost would be around US$ 25-30m as the baseline cost increases.

 

[DANGER-ZONE]

the fly-off cost will be around US$15m/ac. add the weapons and ground infrastructure/equipment, the cost goes up to US$20m/ac - this is a very attractive 'price' for 3rd world airforces to get a modern 3++ generation a/c. later blocks of the JF-17 as it matures will take it into the 4th generation realm in about 3-5 years time. then the cost would be around US$ 25-30m as the baseline cost increases.

sir what do u mean by this?
we people expecting thunder a 4th gen fighter.

 

[Chanakyaa]

sir what do u mean by this?
we people expecting thunder a 4th gen fighter.

You should not be really concerned with the nomenclature .
JF17 is a boon for Pakistan , wheather its 3++ or 4.0 or 4.5 is immaterial ( and even confusing as LCA and Su MKI with Typhoon are ranked 4.5 Gen Fighters. which is correct in one way but as u may feel seems very weird).

Its the most effectively integrated package at a very right price that will enable PAF to maintain the numbers comfortably and that too with a Indigenous product.

And im NOT consoling you , Time has shown that backed by good Tactics and Experience Even Slow Harriers can Hit Mig 29s !.. Its NOT just the machine .. but a Combo of Man and Machine

So Dont care about the classification, cheer that u have what very few nations have, unfortunate but even India is yet to deploy LCA and no doubt PAF has been ahead in this context.

 

[Patriot]

Must have been a mistake by sir fatman.It's a 4th generation fighter without any doubt..but will be 4.5th once we get western equipment.

 

[Luftwaffe]

with all the investments on a single unit sharing 50-50 profit Pakistan would make $5-7 million on a primary configuration..
by 2014-2017 those Air Forces who ordered FC-1 wants to go with AESA the cost can go up to $30M as rightly said other members...the profit would go to $10-12 million per unit after 50-50 share that alone is a big share and success in production and marketing of FC-1/JF-17 and we hope Pakistan-China gets many orders..

 

[haawk]

THE cost of the stuffthat goes in may come to be 10million or so ....but you guys forget the other costs------labour both skilled and unskilled,cost put in to design the plane,transport of components ,engine(russian),costs that go into setting up of the factory/components,then comes the profit

 

[graphican]

Must have been a mistake by sir fatman.It's a 4th generation fighter without any doubt..but will be 4.5th once we get western equipment.

Is there anything that a 4th gen fighter should have and thunder lacks that? All the 4th gen specks that I know of are found in thunder but Sir Fatman is too senior to make a mistake like that. What is your finding on that?

 

[graphican]

I think the consideration that we are not manufacturing 100% of its components locally would be making its price higher than if it had been built entirely locally. Engine, Radar, Avionics and Armaments are being purchased from China and other international sources. So may be the price is not as low as I was anticipating.