UAE Buys C-17s, Seeks C-130Js
Related Stories: Americas - USA, Boeing, Contracts - Intent, Lockheed Martin, Middle East - Other, Power Projection, Transport & Utility
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The biggest news from the 2009 IDEX exhibition was the UAE’s twin selections of medium and heavy transport aircraft; estimates at the time placed the total value at AED 10.7 billion (about $2.78 billion). The C-17 order later rose to 6 planes, and negotiations remain in progress for the C-130J-30 buy – but a recent DSCA announcement indicates that it, too, may be close.
Given the country’s geographic position, and the global shortage of military airlift capacity outside of the United States, a force of this size and quality can be parlayed into international influence by supporting multi-national military deployments and humanitarian efforts from Africa to South Asia, and around the world…
- Do? Buy?
- Contracts & Key Events
Do? Buy?
Dubai, UAE has been hit hard by the global economic downturn, and in November 2009 by its own debt crisis. It remains a business center in the Middle East, nonetheless. The Emirati Royal Family’s seat at Abu Dhabi has extensive oil and gas deposits, as well as a sovereign wealth fund worth several hundred billion dollars.
In the end, the UAE would see Gulf Cooperation Council partner Qatar’s 2 C-17s, and raise them by 4, creating the world’s 3rd largest fleet of these long-range strategic transport aircraft after the USA and Britain. The median cost estimate has now risen to around $2 billion. The C-17s and their rough airfield capabilities are expected to be paired with a future AED 5.9 billion (about $1.6 billion) deal for 12 of Lockheed Martin’s similarly flexible C-130J-30 medium-range tactical transports, creating a force that gives the UAE’s military considerable mobility within the country – and beyond.
Contracts and Key Events
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Jan 6/10: Boeing announces a contract with the UAE for 6 C-17A heavy airlifters, a 50% increase over earlier reports. Under the agreement, the UAE will take delivery of 4 C-17s in 2011, and 2 more in 2012, and will join the C-17 Globemaster Sustainment Partnership. Despite the lack of previous DSCA approval announcements for the aircraft sale itself, and the use of Direct Commercial Sales for C-17 customers like Canada and Qatar in the past, Boeing has confirmed to DID that this is a Foreign Military Sale acquisition.
Financial terms are not being disclosed, but the UAE’s Waha Capital PJSC issues a release, citing the closure of an AED 6.7 billion (USD 1.8 billion) military deal, which includes the purchase of 3 Airbus A330-MRTT aerial refueling and transport aircraft, and 6 C-17s. The release places the A330 deal at AED 4.4 billion/ $1.2 billion, and the C-17 deal at AED 2.3 billion/ $634 million… but standard prices for both aircraft suggest that those figures should probably be reversed. Military defensive systems and ongoing support arrangements will add another $500 million to the C-17 deal, per the recent DSCA request, and some ancillary military budget costs can also be expected. That pushes the estimated total cost of buying the new C-17s and making them ready for operations to somewhere between $1.7 – 2.2 billion.
The UAE contract pushes the total number of C-17s added since September 2009 to 17 (10 USA FY 2010, 1 UK, 6 UAE), and raises FY 2010 C-17 production to the full production rate of 15 planes. Total lifetime C-17 orders now stand at 249 (223 USA, 7 UK, 6 UAE, 4 Australia, 4 Canada, 3 NATO, 2 Qatar with 2 more options), and the current production backlog is 37 planes. Boeing representatives say this will continue production through to September 2012. Boeing | Waha Capital PJSC | Arabian Business | Middle East North Africa Financial Network | Long Beach [California] Press Telegram | UPI | Agence France Presse | Aviation Week | Flight International.
Dec 28/09: The US DSCA announces [PDF] the United Arab Emirates’ official request to buy logistics support and training for 12 C-130J-30 aircraft being procured through a Direct Commercial Sale, as opposed to a Foreign Military Sale (FMS) that is subject to more stringent notification and review criteria. C-130s also have civilian versions, and may not necessarily be designated as military items under ITAR laws.
On the other hand, FMS notification rules do apply to the 12 AN/AAR-47 Missile Approach Warning Systems, 12 AN/ALE-47 Countermeasure Dispenser Sets, and 12 AN/ALR-56M Radar Warning Receivers, which the UAE will need in order to operate its C-130J-30s under combat conditions. This FMS notification also covers unspecified “communication equipment,” mission planning systems, navigation equipment, aircraft ferry and refueling support, spare and repair parts, support and test equipment, publications and technical documentation, personnel training and training equipment, and U.S. Government and contractor support.
The estimated cost is $119 million, the principal contractor will be Lockheed-Martin of Bethesda, MD, and implementation of this proposed sale will not require the assignment of additional U.S. Government or contractor representatives to the United Arab Emirates. DSCA does add, as they have for the UAE’s recent CH-47F, and C-17A requests, that:
“The proposed sale will provide the United Arab Emirates the capability to transport equipment and troops in the region, and support U.S. and NATO airlift requirements in Afghanistan.”
Dec 18/09: The US DSCA announces [pdf] the UAE’s formal request to join the C-17 Globemaster III Sustainment Partnership, which provides depth maintenance services for all global C-17 operators under an incentive-laden contract. It also included language that was found in the UAE’s recent request for CH-47F Chinook heavy-lift helicopters, saying that:
“The proposed sale will provide the United Arab Emirates (UAE) the capability to transport equipment and troops in the region, as well as, to support U.S. and NATO airlift requirements in Afghanistan.”
The UAE’s exact request includes support, training and related systems for 4 C-17 Globemaster III aircraft being procured through a Direct Commercial Sale (as opposed to a Foreign Military Sale), plus ancillary military equipment to include 5 AN/AAR-47 Missile Warning Systems, 5 AN/ALE-47 Countermeasure Dispensing Sets, 10 AN/ARC-210 (RT-1794C) HAVE QUICK II Single Channel Ground and Airborne Radio Systems (SINCGARS), plus ferry support, communication and navigation equipment, spare and repair parts, support and test equipment, publications and technical documentation, maintenance, personnel training and training equipment, preparation of aircraft for shipment, and other related elements of US government and contractor support.
While DSCA requests are not contracts, they are required before contracts can be issued. This official request, and its clearance, may indicate that a formal contract is close. The estimated cost is $501 million, the prime contractor will be the Boeing Company of Chicago, IL, and implementation of this proposed sale will require the assignment of additional U.S. Government and contractor representatives to the UAE. The number of representatives required, and exact cost, will be determined in joint negotiations.
Feb 24/09: The announcements are made at IDEX 2009. Reports set the price for 4 C-17s at AED 4.3 billion (about $1.3 billion), coupled with an AED 5.9 billion (about $1.6 billion) deal for 12 of Lockheed Martin’s C-130J medium-range tactical transports. Abu Dhabi’s privately-owned Waha Capital usually finances airline purchases, and has reportedly been tapped to finance the C-17 and C-130J contracts. Flight International | Defense News | bNet | Jerusalem Post.
