Derailed Denouement in Dubai: What’s Up With the UAE’s Fighter Deal?Nov 17, 2011 21:57 UTC by Defense Industry Daily staff
With the 2011 Dubai Airshow in full swing, the biggest question on site is: what’s happening to the UAE’s planned fighter deal? The United Arab Emirates’ interest in up to 60 Dassault Rafale fighters has seen years of negotiations, and the 2011 show was expected to be the clincher.
Instead, it has opened the door to Eurofighter GmbH, even as Boeing admits to giving classified technical briefings centered on its F/A-18 Super Hornet and F-15 Strike Eagle families. Unlike Eurofighter, Boeing hasn’t received an RFP, but other reports suggest that the UAE may be about to reduce its planned new jet order and buy more of its unique Lockheed Martin F-16E/F Block 60s, regardless of what happens next. The bombshell hit at Dubai’s 2011 air show.
As word leaked out that Eurofighter GmbH was working on a response to a formal RFP from the UAE, Abu Dhabi Crown Prince and UAE Deputy Supreme Commander Sheik Mohammed bin Zayed Al Nahyan was quoted by the UAE’s official news agency as saying that:
“Bilateral relations have never been stronger and [President Sarkozy's] constant personal intervention in this process has sustained Dassault at the forefront of our considerations. Regrettably Dassault seems unaware that all the diplomatic and political will in the world cannot overcome uncompetitive and unworkable commercial terms.”
The UAE is known in the global arms trade for rigorous tests and hard bargains. This is either the mother of all hardball negotiations, or the potential Rafale sale is crashing.
In support of the latter interpretation, an anonymous UAE government source is quoted using even harsher words than the crown prince. He describes the frustration with Dassault as “shared” between the UAE and France, adding that the firm is leaning on the French relationship to “hold out on pricing and a deal structure that hasn’t changed in more than a year and that has been significantly bettered by all competitors.”
On the other hand, it’s difficult to see which competitors our source could mean, if Dassault is the only one to respond to the RFP so far. It’s possible that other vendors have offered rough pricing ranges, but it’s also possible that the UAE is very aware that (a) the Rafale badly needs a 1st export client; and (b) any serious backlash in the UAE could also affect a larger potential sale in India. Neither creates incentives for compromise.
In the Rafale’s favor, reports insist that the French are still pushing hard for a deal. French air force commander Jean-Paul Palomeros has told AIN that negotiations are now about the cost of maintenance and manpower, rather than major technical upgrades. The UAE had been pushing for a range of enhancements, from an AESA radar, to further defensive system improvements, to upgraded Snecma M88 engines. The RBE2-AA AESA radar is now being fielded, and the plane’s defensive systems proved themselves over Libya. The engines are reportedly no longer an issue, either, after the Rafale demonstrated that it could take off from Al Dhafra airbase on a hot day, carrying a very full combat load of 2 MBDA Scalp cruise missiles and 3 fuel tanks.
Even if Rafale wins, however, some sources suggest that it may be a smaller deal. Flight International’s The DEW Line:
“Riad Kahwaji, chief executive officer of the Institute for Near East and Gulf Military Analysis (INEGMA)… who is well connected in Abu Dhabi… [says the potential Rafale deal] has been reduced from 60 fighters, with the balance shifted to a follow-on order of some number of F-16 Block 60s. Northrop Grumman, which supplies the APG-80 agile beam radar for the Block 60, confirmed this strategy today. Northrop told [Flight International's] Greg Waldron that the UAE is considering a follow-on order for the Block 60.”
Of course, Eurofighter has yet to submit a formal bid, and the UAE seems to have its options wide open if it wants to invite vendors like Boeing to the RFP. If they get their price, a full-size order is always possible. The biggest missing piece in all of this is Lockheed Martin’s F-35, which seems most noticeable by its absence from Dubai Air Show 2011 discussions. Time will tell.