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UAE May Ditch Rafale
Hornet a Surprise Competitor for $10B Deal
By PIERRE TRAN
Published: 13 September 2010
PARIS - The United Arab Emirates (UAE) has requested technical information on the Boeing F/A-18E/F Super Hornet, a surprise move that turns an anticipated order of Dassault Rafales into a $10 billion competition, an Arabian Gulf defense source said.
"The UAE is asking the U.S. for information on the F/A-18 Super Hornet in the single- and twin-seater version," the source said. "It is in the very early stages; it's a preliminary contact. The UAE has opened the door to them."
UAE authorities approached Boeing about a month ago and were directed to the U.S. government, which is expected to respond in a month or so, a U.S. source said.
It's not clear why Abu Dhabi has suddenly expressed interest in the latest version of the U.S. strike fighter. Technology may be part of the reason, but politics is likely the main cause.
But the news will come as a severe upset to the French government and industry, which had confidently expected to secure a sale of the Dassault jet without competition.
"This is worth about $10 billion, depending on the delivery dates` and specification," the Gulf source said.
The deal means even more to the French administration, which has invested much political capital and effort in pitching the jet to the Gulf state.
Rafale is the standard-bearer for French aerospace industry, showcasing Dassault's competence as a designer and builder of cutting-edge fighters, Safran's engines and Thales' radar, electric warfare and avionics. A host of subcontractors depend on the jet, while MBDA hopes a UAE purchase will lead to exports of the Meteor and other missiles.
Two years ago, Claude Gueant, secretary general in the office of President Nicolas Sarkozy, told Europe 1 radio, "France is in negotiations with serious hopes, effectively, of selling around 100 Rafales. After 23 years, we're going sell Rafales at last."
Last year, Sarkozy put his personal stamp on the sales effort, talking up the fighter during a visit to Abu Dhabi to open the new French permanent military presence in the Gulf. Up to 500 French military personnel will be stationed at the Al Dhafra airbase, which houses a small number of Rafale fighters; and a naval station at the Mina Zayed port. The French Navy underscored the importance of the visit by dispatching three warships.
The Rafale has yet to win an export order; if the emirate buys it, other countries might follow suit.
The UAE is looking to replace the 63 Dassault Mirage 2000-9s it bought just over a decade ago. As part of Paris' efforts to sell the Rafale, France has offered to buy back the Mirage aircraft, which it would hold in a special-purpose company while looking for an export buyer.
Calls to the French president's office were not returned by press time.
WHY THE SHIFT?
It was not immediately clear why the UAE is exploring a U.S.-made option.
The U.S. source said the Gulf state is believed to be frustrated over price and the technology offered by France.
UAE authorities have been negotiating with the French government and industry a potential co-development of a more capable "fifth-generation" model of the Rafale.
Abu Dhabi is being asked to pay to upgrade the Rafale, while the F-18 is already at the desired technological level.
The Gulf source said, "The Super Hornet has everything we need. We don't need to co-develop or modify it."
Upgrades under discussion include a longer-range active electronically scanned radar, a more capable Spectra electronic warfare suite and a M88 engine that gives 9 tons of thrust, 1.5 tons more than the ones in the French Air Force's Rafales.
French Defense Minister Hervé Morin has said developing the upgrades would cost UAE around 2 billion euros ($2.6 billion). France itself would also bear some of the cost.
Media reports have estimated the actual development cost to UAE at 4 billion to 5 billion euros. Morin dismissed those figures as "fantastic."
The UAE did help bankroll the development of the Block 60 version of the Lockheed Martin F-16 and owns some of the technology. UAE bought 80 of the so-called Desert Falcon planes for $7.2 billion in the 1990s under a policy of spreading purchases among suppliers.
POLITICAL WINDS?
But the Gulf source said technology was not the reason for the sudden shift.
"This is not about the specifications," the source said.
Perhaps a political shift is behind it. Dassault Executive Chairman Charles Edelstenne has underscored the role of politics in fighter sales.
"The sale of combat aircraft is a political act. All we can do is to make the best plane possible," Edelstenne said in March. "The Elysées [presidential office] does a superb job. In May 2007, we had zero prospects. Today, we have a significant number."
Besides negotiations with Abu Dhabi, Dassault has fielded the Rafale in contests in Brazil, India and Switzerland. Paris also enjoyed last year a period of exclusive talks with Libya, which lapsed without a deal.
The F-18 is a competitor in the Brazilian and Indian races. Boeing withdrew from the now-delayed Swiss tender, but could re-enter when the competition is relaunched.
It is unclear what political shift might have occurred recently between France and the UAE, analysts said.
"There has not been a notable change in relations," said Pierre Razoux, senior research adviser at the NATO Defense College, Rome.
RELATIONS APPEARED SOUND
The inauguration of the French military base sent a strong signal of political support. Sarkozy's tough position on Iran's nuclear program was a sign that bilateral ties were running on a normal course.
"Abu Dhabi is a good friend," Razoux said.
The Rafale would not be the first French weapon to ink its first export sale in Abu Dhabi. In 1994, the UAE spent $2.4 billion to buy 390 Leclerc tanks and 46 armored recovery vehicles, built by Nexter, then known as Giat Industries. That has been the Leclerc's sole export sale.
But the Rafale is also the second European weapons deal in recent months to founder in the UAE. Last month, Finmeccanica was unable to deliver UAV technology, which had been agreed as part of a sale of 48 M346 jet trainers, leading the UAE to reopen talks to acquire the T-50 aircraft from South Korea.
UAE May Ditch Rafale - Defense News
