given by the company’s CEO on Friday. The South American country originally signed for two of the light tactical aircraft in November 2013, adding a further two in May 2014, with the Peruvian Air Force looking to replace their twelve-strong fleet of Soviet-era Antonov AN-32s.
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Major purchases that make headline news are few and far between in Peru. How do you top the recent re-opening of the DIFAA UFO investigation department? If you’re the Peruvian Air Force, you buy 2 C-27J light tactical airlifters from Italy’s Alenia Aermacchi, in order to shore up a weak area for the FAP. DID looks at the underlying need, the contract, the larger opportunity thjat is coming into focus, and why Alenia won. We also compare successes to date for Finmeccanica’s C-27J and its main rival, Airbus Military’s C295.
The Peruvian Opportunity in Context
After flight evaluations of the C-27J, Airbus C295, and Antonov’s upgraded AN-32RE, Peru invited bids, but Antonov didn’t respond. Alenia says that it won the final competition against the C295 due in part to its high-altitude capabilities among the Andes mountains, “with the capability to operate on a large number of airfields where its competitor is unable to land.”
It’s well known that the C-27J design trades some flight cost efficiency for extra speed and power, and the Peruvian Ministerio de Defensa says that the C-27J doubles the C295’s total load at high-altitude Peruvian airfields like Arequipa, Ayacucho, Juliaca, Anta, Puerto Maldonado, Huanuco, Andahuaylas, Cusco, Cockaigne, etc. Indeed, the MdD went farther, pointing out that the C295 has less power than the FAP’s long-retired AN-26s, which experienced a number of fatal accidents.
Alenia’s release also cited their plane as “the only aircraft in its class interoperable with heavier airlifters already in service in Peru.” That statement is a bit puzzling. Peru operates a small airlift fleet, and most of them are either equivalent (12 old An-32Bs, being replaced) or lighter (new DHC-6-400 Twin Otter) planes. The only aircraft that would qualify as “heavier airlifters” are a pair of 737s used as utility/VIP aircraft, an L-100-20 (civil stretched C-130E) and a pair of ex-USAF C-130Es. The C-27J’s commonalities, such as they are, are mostly with the modern C-130J.
On the other hand, Australia’s ANAO says that they picked the C-27J in part because the Airbus C295’s narrower cargo compartment can’t transport the standard sized cargo pallet used in the RAAF’s C-130s. With so few tactical airlifters in FAP service, one can understand why the C-27J’s ability to carry vehicles and small helicopters, and to use the same cargo pallets, would give it another advantage over the C295.
Global Markets: The Bigger Picture
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Peru becomes the 11th C-27J customer, joining Italy (12), Australia (10), Bulgaria (3+5), Greece (8), Lithuania (3), Mexico (4), Morocco (4), Romania (7), the United States (21), and “an undisclosed African country” (Chad – 2). Total orders to date are 76 aircraft. Roll-on kits for MEDEVAC and Search and Rescue exist, firefighting looks set to be added, and a more extensive conversion creates the MC-27J Praetorian gunship.
That’s a decent total, but it lags behind its perennial Airbus C295 opponent, whose maritime patrol option has helped expand sales to 97 so far. The new C295W promises improvements to flight performance specifications that have cost the airlifter in Morocco and Peru, an AEW (Airborne Early Warning radar plane) collaboration with Israel’s IAI is in testing, ad so is a firefighting version. which Airbus is only offering on the smaller CN235 so far.
Contracts & Key Events
November 2/15: Peru is looking to buy another 6 to 8 Alenia Aermacchi C-27J Spartan transport aircraft and is currently in talks with the Italian firm, according to a press briefing given by the company’s CEO on Friday. The South American country originally signed for two of the light tactical aircraft in November 2013, adding a further two in May 2014, with the Peruvian Air Force looking to replace their twelve-strong fleet of Soviet-era Antonov AN-32s.
November 2014: Deliveries on track. Peru’s ministry of defense expects to receive its first 2 aircraft between March and April 2015, followed by 2 other planes in the following months, in line with the 4 C-27Js ordered so far (q.v. Dec 18/13, May 7/14). Like most of its South American neighbors Peru has been facing a marked slump in its growth rate, but with GDP growth of about 3% in 2014, the country is performing less poorly than its peers.
Sources: Ministerio de Defensa, “primeros aviones italianos de transporte C-27J llegaran en quatro meses”, The Economist: “The great deceleration.”
May 7/14: +2/+10. Peru’s defense minister Pedro Cateriano Bellido visits Italy and announces that Peru will be buying another 2 C-27Js. He adds that their intent is to completely replace their 12 AN-32s in the air force and beyond, which would raise the deal’s total value to around $600 million. It would also make Peru one of the type’s largest single fleets, alongside Italy.
As part of this commitment, Bellido signed a strategic collaboration agreement with Italy’s Ministry of Defence to develop Peru’s aviation industry. This is a major breakthrough for Finmeccanica in Latin America, where it has had a difficult time competing with Spain’s CASA (now Airbus Defence). Finmeccanica will open a liaison office in Lima, and has launched a Spanish language website for the C-27. Sources: C-27J.es | Alenia Aermacchi, “The C-27J Spartan Spanish Website is Live Online” | Italy’s Asca, “Alenia Aermacchi: al Peru’ altri due C-27J per circa 120 mln dollari” | Il Sole 24 Ore Dal Peru commessa da 600 milioni di dollari per Alenia Aermacchi: salgono a 12 gli aerei richiesti all’azienda italiana | Prima Press, “Alenia Aermacchi: il Peru acquista altri due C27J” | Torino’s Republica, “Il Peru compra altri due aerei Alenia. L’azienda: “Assunzioni in Piemonte”.
2 more, could rise to 12 TL.
Dec 18/13: Formal signing. Formal signing of the Peruvian contract for 2 C-27Js. Sources: Alenia Aermacchi, “Alenia Aermacchi signs contract with the Peruvian Ministry of Defense for two C-27J Spartan”.
Nov 25/13: Contract. Finmeccanica subsidiary Alenia Aermacchi’s release described the contract as “around” EUR 100 million. Peru later nailed down the figures: $121,986,000, which saved $12.28 million over the initial price of US $ 134,274,491.22.
That $60 million per plane involves far more than just flyaway cost. The contract includes full training, 1,000 hours of flight, ground support equipment, additional Search & Rescue and Air Ambulance kits, 2 years of support, and industrial and social offsets equivalent to 100% of the contract. Alenia also reduced their proposed delivery time from 18 – 15 months, moving planned delivery to April 2015.
Future contracts could add more business for Finmeccanica. The FAP operates 5 AN-32B light tactical transports, but Peru flies 12 AN-32Bs across its entire armed forces. The 20-year old planes are openly described by Peru’s MdD as “proximos a cumplir su Tiempo Limite de Operacion,” so something will have to be done soon.
2 C-27Js
Additional Readings
* El Comercio (Nov 30/13) – Perú compró dos aviones italianos para la FAP por US$ 121,9 millones
* Peru MdD (Nov 29/13) – Adquisicion De Aviones De Transporte De La Fap Es Legal Y Permite Ahorro De US$ 12 Millones
* Alenia Aermacchi (Nov 25/13) – Peruvian Ministry of Defense selects the Alenia Aermacchi C-27J
Background: Aircraft
* Alenia North America – C-27J Spartan Tactical Transport Aircraft
* DID – Ferry Dust: Why Did Australia Sole-Source the C-27J?
* DID – India Refurbishing its AN-32 Transport Fleet. The AN-32RE evaluated by Peru is based on a modernization program for India’s AN-32 fleet, which also needs to be able to operate at high altitudes.
* Airbus Military – C295.
