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India selects EF, Rafale for MMRCA shortlist

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Package, not just bid price, to decide $10.4-bn dogfight winner

New Delhi: With commercial bids for the country’s $10.4-billion order for 126 multi-role combat jets likely to be opened by this month end, the stage is set for a showdown between two multi-role European fighters as both try to prove economically-efficient option by including offers like the lifecycle and maintenance costs.

Both the aircraft — Eurofighter Typhoon and Dassault’s Rafale — are being deployed in policing the no-fly zone over Libya and both are seeking export sales to compensate for defence-spending cuts at home. However, the declaration of the successful bidder will take a while. According to the outgoing IAF chief, Air chief marshal PV Naik, “Once the commercial bids are opened, the final decision would still take a couple of months as it is not just the price but the package in terms of direct costs, support programmes, training, offsets and lifecycle costs which would determine the winner.”

It may be noted that according to industry insiders, Rafale had quoted a price of $85 million per aircraft and Eurofighter $100 million per piece in flyaway condition in the recent Brazilian competition. For the Indian Air Force (IAF), the Rafale and Eurofighter quote is anybody’s guess, but according to the the industry the machines should cost anywhere between $75 million and $80 million per aircraft in flyaway condition.

The IAF will arrive at a final cost for the two aircraft based on various other factors like the lifecycle cost, maintenance cost, transfer of technology and cost of spare parts. Also, 50% of the total cost of the deal has to be invested in the Indian industry under the offsets obligation.



The two contenders have a long competitive history. France had pulled out of the early stages of the Eurofighter project 30 years ago and opted to build its own fighter plane, the Rafale, as a successor to the Mirage. Presently, Rafale is still looking for its first foreign customer, while the Eurofighter programme is facing various cutbacks home.

According to Eurofighter officials, 280 Typhoons have already been delivered out of the 707 on contract to Germany, Italy, Spain, the UK, Austria and Saudi Arabia. Asked if Eurofighter is willing to “give away” its unique selling \propositions, including source codes of radars and design, for the “sake of 126 units”, the consortium said it would not be an issue if India becomes a partner of the Eurofighter programme.



Rafale so far has sold just 180 aircraft to its own French air force at a cost of 142.3 million euros each, including material costs, investments made and the variables. The French Court of Auditors Annual Public Report 2010 has pointed out that the French air force had initially placed an order for 320 aircraft, but the defence ministry downsized it to 280. Sources in the Indian government said, “The European consortium, to give an edge to its offer, has invited India to become a partner for the Typhoon programme and also offered to establish a production line in India. The Rafale has the advantage of being logistically and operationally similar to the Mirage 2000, which the IAF is presently operating. The Rafale’s inclusion would require fewer changes in the existing infrastructure.”

According to the French audit report, in early 2000, sharp rise in material costs had created a cash crisis for the Rafale programme. Also, with no foreign buyers the price tag per piece of the aircraft is likely to go up. On the other hand, Germany, Italy, Spain and the UK, which partner the development and production of the Eurofighter Typhoon, are willing to put “everything on the table” under the technology transfer commitments if they win the contract to supply these aircraft to the IAF.


Package, not just bid price, to decide $10.4-bn dogfight winner
 
calculating L1 will be tricky - lots of factors and will be almost impossible for us to predict like the mk2 engine deal - every defence journalist was reporting an almost certain victory for ej 200, but turned out pretty different in the end
 
Rafale and AASM-Hammer, a dynamic duo

20-07-2011 - As we have seen throughout recorded history, each new conflict seems to bring its own share of innovations. Recently, for example, the air strikes over Libya - Operation Harmattan for France, and Operation Unified Protector for NATO in the framework of the UN resolution 1973 - have spotlighted the unexpectedly powerful performance of a new French-made weapon, the AASM Hammer (Highly Agile Modular Munition Extended Range) air-to-ground modular weapon developed and produced by Sagem...

...According to Captain P, who is very satisfied with the performance of this new weapon, "In the Libyan theater of operations, as soon as we have the slightest suspicion of air defenses, which are always widely scattered in Libya, we remove the Paveway bombs and equip our Rafales with the AASM, because it allows us to effectively engage the enemy, away from their air defenses, especially the dangerous ’SAM rings’. In TST (Time Sensitive Targeting) mode, the AASM’s range also allows us to hit a target without being detected from the ground, a possibility in asymmetrical combat...

..."Over the last twenty years, the nature of warfare has changed completely: the enemy is more diffuse and the risks of collateral damage a major concern. So we need new systems that reduce detection and allow us to engage several targets simultaneously. The AASM full meets these requirements for our operations in Libya, since it can be used not only for symmetrical combat, but also for asymmetrical combat as well as guerrilla operations”.

Sagem


The captain is describing a very important point that should be very interesting for IAF as well, because in any future conflict IAF will not have air superiority anymore, like they had it during the Kargil war. Even if IAF now will have several fighters in the fleet than can do precision strikes with laser guided bombs, they will have to penetrate enemy airspace, approach until 10 to 20Km to the target (range of the guided bombs) and in case that the targets are seperated from each other, attack them in independent attack runs. Su 30 MKIs, or the upgraded Mig 29s might use GLONAS guided KAB bombs to attack different targets at the same time, but still have to get very close to them. Rafale and the upgraded Mirage 2000s with AASM on the other side will be much more survivable, because they can drop their weapons at nearly 3 times the range and attack different targets at the same time, so can remain at safe distance and with less time behind enemy borders. A clear tactical advantage for IAF in preemptive strikes, besides the other advantages they offer in deep strikes with Scalp cruise missiles, or heavy strikes with GBU 24 bunker busters.
 
gr8 chances for eft..

If they offer enough in return for the high costs and upgrade delays, yes.


calculating L1 will be tricky - lots of factors and will be almost impossible for us to predict like the mk2 engine deal - every defence journalist was reporting an almost certain victory for ej 200, but turned out pretty different in the end

Both are very different stories, because at the engine deal the cost per unit was the main part to be L1 and it was clear from the start that the US engine was cheaper, while the EJ 200 was more advanced and offered more scope.
In MMRCA instead, it's not only the unit costs, but also the operational costs throughout the lifecycle, the upgrade costs, the costs of the licence production and ToT... and nobody than MoD/IAF will know exactly where they set the priorities and how they calculate it. By reported costs per unit and per hour the Rafale should be L1, that's all we can say at the moment.
 
Both are very different stories, because at the engine deal the cost per unit was the main part to be L1 and it was clear from the start that the US engine was cheaper, while the EJ 200 was more advanced and offered more scope.

Actually it is believed that EJ Quoted less as an engine .. but on a total .. it is GE which quoted less.. for instance EJ supplied machines and tools which have to be returned back after the contract... but GE gave it for free.. the reports EJ quoted less that came out was correct but on over all cost GE emerged the winner
 
Actually it is believed that EJ Quoted less as an engine .. but on a total .. it is GE which quoted less.. for instance EJ supplied machines and tools which have to be returned back after the contract... but GE gave it for free.. the reports EJ quoted less that came out was correct but on over all cost GE emerged the winner

That is not entirely correct - EJ tried to revise the price of the bid in the last moment - which was not accepted by MoD. Due to which EJ turned out to be more expensive (even for engine to engine comparison) with respect to GE. If MoD had accepted the revised bid, then L1 would have been EJ.
 
That is not entirely correct - EJ tried to revise the price of the bid in the last moment - which was not accepted by MoD. Due to which EJ turned out to be more expensive (even for engine to engine comparison) with respect to GE. If MoD had accepted the revised bid, then L1 would have been EJ.

It was not the price of the engine they where trying to ... put the over all price.. remember the engines where to be manufactured in India..
 
Sancho- in your opinion, what 'offer enough in return' will satisfy you to go for EF?

Hard to say, especially because I always look at what is best for our forces, rather then for politics, or industry. However, what we badly need is engine and radar technology, possibly participation of DARE on EFs EWS upgrades, so if they provide us much useful ToT in these fields, the costs and delays could be justified over the long term.
As I often stated, if we had the same offer for EF back in the time when we went with MKI, I would have fully supported the EF, because what we searched back than was more suiting to the capabilities of the EF and we could have participated more in the development and more towards our requirements. Today the fighter is not what our forces needs and the participation and future potential is limited, which makes the Rafale the better choice!


Actually it is believed that EJ Quoted less as an engine .. but on a total .. it is GE which quoted less.. for instance EJ supplied machines and tools which have to be returned back after the contract... but GE gave it for free.. the reports EJ quoted less that came out was correct but on over all cost GE emerged the winner

Not sure about that, because the only source that said the EJ 200 was cheaper was Ajay Shukla, which turned out to be completelly wrong on that. Also keep in mind that there were some bribery allegations regarding the Europeans as well, but personally I think they simply choosed the cheapest and easiest to induct solution as a stop gap. GTRE and MoD wants the Kaveri - Snecma engine, while IAF wants an improved Kaveri K9 to power at least LCA MK1 after MLU, if not additional MK2s before. From this point of view, the GE engine was the logical choice, because we now use it's predecessor and from all reliable sources, it is cheaper per unit as well than the European engine.
 
If they offer enough in return for the high costs and upgrade delays, yes.

Though an estimate but could this be an Indication?, See below....

Rafale had quoted a price of $85 million per aircraft and Eurofighter $100 million per piece in flyaway condition in the recent Brazilian competition...............but according to the the industry the machines should cost anywhere between $75 million and $80 million per aircraft in flyaway condition.

Look at the drop in prrice by the increase in number....Drop of $ 20 million for EFT against $10 million for Rafale?
 
Though an estimate but could this be an Indication?, See below....



Look at the drop in prrice by the increase in number....Drop of $ 20 million for EFT against $10 million for Rafale?

The problem is, the EF was not shortlisted in Brazil and no price was reported, or negotiated there. Not sure where the author got this price from, but I think the EF T3B with AESA..., will cost clearly over $100 millions even for EF partners and since the production costs in Europe are similarly high, why should the licence production in India be so much more cheaper for EF? :undecided:
 
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