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  • Loke
    Rank 5 Registered User
    • Jun 2008
    • 3302

    Originally posted by Spitfire9 View Post
    I thought Tejas Mk2 had been shelved because delivery of light fighters is too urgent to wait for Mk2.
    Exactly, and this is what potentially could open up for Gripen NG -- as an Tejas mk2 substitute.

    Comment

    • Vnomad
      Rank 5 Registered User
      • May 2011
      • 2859

      Originally posted by Spitfire9 View Post
      Agreed, makes financial sense for India to buy the F-16 production equipment rather than build new for Gripen. However, there appears to be some resistance voiced to F-16 on the grounds that Pakistan is/has been supplied with F-16. Personally, I don't understand why.
      Well there is the PR issue, which would probably be a matter of concern for a govt that has to manage public opinion. The resistance seems to be ebbing though, going by press reports. And then there's also the option of the Super Hornet.

      I'll retract what I said about India doing very little design work for MCA. What I should have said was that India should only design those parts of MCA where local design resources have the skills and knowledge required to do so effectively (including TOT as available from SAAB, where practical).
      They could directly contract Saab for design consultancy services. No need to sign on to the Gripen for that. Boeing & BAE could do the job as well. The really intriguing possibility IMO, is a true joint-venture with Israel on the project. Perhaps with the aircraft scaled up a bit to be an adequate F-15 replacement. The work-shares would be (somewhat) complementary. Elta's competence wrt to radar/EW components and Rafael's with EO systems would suit it perfectly. And the IsAF would finally be able to get some non-US fighters to complement its F-35Is. Certainly makes more sense than the idea of reviving the Lavi project as a JV. Anyway... I'm just spitballing here. Its a far-fetched notion I know.

      Comment

      • Vnomad
        Rank 5 Registered User
        • May 2011
        • 2859

        Originally posted by Loke View Post
        F-16 AFAIK is very unpopular in India due to the fact that it's being used by Pakistan.
        It was very unpopular only in military/strategic circles, and that too when the Rafale seem to be the way to go. The important thing is what the govt thinks. They could probably spin a story for the press if they had to; F-16V >> F-16C/D or something similar. And then drape it all in 'Make-in-India' dressing.

        I'm not saying that the Pakistan thing is not a factor, just that its not quite as big as it used to be. Especially since the MMRCA was cancelled. Good article on the issue (cross-posting from the IAF thread).

        When it comes to costs I think they will have to look at the total cost, not just a part of the cost.

        Don't forget the SH was competing against Gripen in Brazil -- as you would expect Gripen was found to be significantly cheaper. Brazil is probably a good reference point since it includes both an assembly line and TOT. Also operating costs will be much cheaper. SH is a great platform but it remains a big, twin-engine plane, and is not particularly cheap. There is a reason why it has not scored many exports. If they want to go cheap then Gripen is the way to go. ... Perhaps IAF would not be very happy, but they are in any case not going to be happy with the final solution, that has been pretty clear for a long time, hasn't it.
        You're missing the crucial difference between the F-16/SH and Gripen E in the current context. In Brazil, they would have set a new greenfield project to build it locally. Its main appeal in India, on the other hand, is the unique opportunity of snapping up on the cheap, an already existing production line that's going-out-of-business.

        They're doing something similar with the BAE M777 howitzer acquisition:

        In 2010 an FMS notification for the sale of 145 guns was priced at upto $650 mil, which was subsequently revised to $900 mil in 2013. As the Indian govt/MoD continued to dither, the production line in Cumbria ran out of orders and started to shut down in late 2013. The new Modi/Parrikar govt revived the acquisition as part of their 'Make' initiative; under the new deal BAE is transferring its production line to Mahindra, a pvt company (though the barrels will continue to be made at a US facility). The cost? $700 million.

        Comment

        • Loke
          Rank 5 Registered User
          • Jun 2008
          • 3302

          Originally posted by Vnomad View Post
          It was very unpopular only in military/strategic circles, and that too when the Rafale seem to be the way to go. The important thing is what the govt thinks. They could probably spin a story for the press if they had to; F-16V >> F-16C/D or something similar. And then drape it all in 'Make-in-India' dressing.

          I'm not saying that the Pakistan thing is not a factor, just that its not quite as big as it used to be. Especially since the MMRCA was cancelled. Good article on the issue (cross-posting from the IAF thread).


          You're missing the crucial difference between the F-16/SH and Gripen E in the current context. In Brazil, they would have set a new greenfield project to build it locally. Its main appeal in India, on the other hand, is the unique opportunity of snapping up on the cheap, an already existing production line that's going-out-of-business.

          They're doing something similar with the BAE M777 howitzer acquisition:

          In 2010 an FMS notification for the sale of 145 guns was priced at upto $650 mil, which was subsequently revised to $900 mil in 2013. As the Indian govt/MoD continued to dither, the production line in Cumbria ran out of orders and started to shut down in late 2013. The new Modi/Parrikar govt revived the acquisition as part of their 'Make' initiative; under the new deal BAE is transferring its production line to Mahindra, a pvt company (though the barrels will continue to be made at a US facility). The cost? $700 million.
          I think you are wrong; there is no special "appeal" with an assembly line of a product that is going out of business. Although it may be more attractive than not having an assembly line at all.

          Perhaps you believe that moving the SH assembly line and assemble X SH will be cheaper than building a new Gripen assembly line and assembling X Gripen? Look again at what Brazil is paying for their assembly line, including training and 36 Gripen. Compare that to the price of SH without the assembly line.

          In addition; although I doubt it, we should not discount the possibility that Saab may suggest to move the existing Gripen assembly line from Sweden to India.... From a cost-effectiveness point of view, that may make more sense, rather than having three assembly lines for such a small product.

          Comment

          • TooCool_12f
            Rank 5 Registered User
            • Dec 2009
            • 3321

            er, as far as cost-effectiveness goes, if what's been said to justify the price increase in MMRCA, the cost-effectiveness is definitely not the main quality of manufacturing in India (from memiry they counted like x2.5 or x2.7 more man-hours for a Rafale made in India compared to France... why would it be any different with SAAB?

            Comment

            • TomcatViP
              Rank 5 Registered User
              • Nov 2011
              • 6110

              With the Gripen, effectively none. Both Raf and Grip adhere to an intensive manual process for their assembly. This makes for the necessary flexibility and grant a lower need in investment when you've to deal with a much lower output.

              On the contrary, the F18 is more automatized (see time lapse of production). This will grant a similar man-hour ratio and lower the need of highly trained operators that are always available in scarce quantity in a country with a raising aeronautical industry such as India. This would even greatly favor the training of new ranks of employee and increases the momentum for the Indian aeronautical industry.

              As I have said before, the F18 offers much more than any of its competitor in term of perspectives*. The RoI IMOHO is straightforward both in term of industrial capacity and formation than in capital. There is no more ideally suited candidate for the Make in India project.

              The F16 is slightly behind. The perspectives of being yet another F16 assembler does not yield as much of a momentum. And even if LM transplants the entire F16 assembly in India, it will be certain IMOHO that other user's concerns will conflict with any ideal of monopoly and large scale of order/work. Also the industrial potential seems to me less with the 16, a slightly older design that in terms of production technologies seems to lag behind.



              *The SH would be then an US/India airframe. Bi-lateral synchronicity and having to deal only with a single partner but yet having the luxury a large fleet to sustain is the absolute ultimate fruit of such a deal. It's unique.
              Last edited by TomcatViP; 30th March 2016, 20:01.

              Comment

              • Loke
                Rank 5 Registered User
                • Jun 2008
                • 3302

                Originally posted by TomcatViP View Post
                With the Gripen, effectively none. Both Raf and Grip adhere to an intensive manual process for their assembly. This makes for the necessary flexibility and grant a lower need in investment when you've to deal with a much lower output.
                The low overhead by opening one additional Gripen line in Brazil seems to indicate this view is much too simplistic. One of the main selling points of the Gripen are low costs; that means not just low operating costs but also low costs in assembling it. Perhaps the Gripen "ikea" cartoons are not so far off!

                Again, check how much (or little) Brazil pays for:

                assembly line
                Tot
                Full Gripen package including 36 Gripen

                If you also take into consideration that Brazil has to cover significant part of the R&D costs of Gripen E/F, perhaps you start to realize that this is indeed a low-cost option!

                Automated assembly does not necessarily mean that moving the SH line will be "cheap"; I clearly recall Americans expressing doubt as to whether India had the necessary competence to operate such a sophisticated assembly line. Training is not cheap.

                Comment

                • TomcatViP
                  Rank 5 Registered User
                  • Nov 2011
                  • 6110

                  There is a lot in Ikea that is contestable in that context. Explicitly when all about their business model is to transfer cost to the customer.

                  I have watched extensively the scenes of the Grip E assembly and it remains to be seen for me if "Cheap" does not transfer to the same idea.

                  Training is not cheap, for sure but a perfectly designed assembly process is theoretically made for... chimps.

                  Comment

                  • Loke
                    Rank 5 Registered User
                    • Jun 2008
                    • 3302

                    Originally posted by TomcatViP View Post
                    There is a lot in Ikea that is contestable in that context. Explicitly when all about their business model is to transfer cost to the customer.

                    I have watched extensively the scenes of the Grip E assembly and it remains to be seen for me if "Cheap" does not transfer to the same idea.

                    Training is not cheap, for sure but a perfectly designed assembly process is theoretically made for... chimps.
                    Very funny.

                    Brazil is a partner not a regular customer. And in any case, all companies base their whole business on transferring the cost to the customer -- who else should cover the costs? Show me a company that that gives away things for free...

                    Comment

                    • maurobaggio
                      Rank 5 Registered User
                      • Jul 2008
                      • 521

                      Originally posted by Loke View Post
                      The low overhead by opening one additional Gripen line in Brazil seems to indicate this view is much too simplistic. One of the main selling points of the Gripen are low costs; that means not just low operating costs but also low costs in assembling it. Perhaps the Gripen "ikea" cartoons are not so far off!

                      Again, check how much (or little) Brazil pays for:

                      assembly line
                      Tot
                      Full Gripen package including 36 Gripen

                      If you also take into consideration that Brazil has to cover significant part of the R&D costs of Gripen E/F, perhaps you start to realize that this is indeed a low-cost option!

                      The Gripen F does not exist even as draft, so there is no way to assume the cost of it, as well the contract with Switzerland has been show the cost of the Gripen E/F in Brazil are not fully detailed so far.

                      1.Comparative Table Brazil / Switzerland

                      Type Number of Gripen NG Amount of Contract (Billions) Unit Cost (millions)
                      Brazil Gripen E/F 36 Us$ 4.5 US$ 125
                      Switzerland Gripen E 22 US$ 3.233 US$ 147
                      By the less of the unit cost from Switzerland the Brazil would have enclosed in its contract:
                      • a new production line that will be installed in Brazil
                      • development of the new Gripen F in Brazil
                      • financial resources to keep the production line in Brazil with rate of the 3 aircraft's per year for five years


                      Originally posted by Loke View Post
                      Automated assembly does not necessarily mean that moving the SH line will be "cheap"; I clearly recall Americans expressing doubt as to whether India had the necessary competence to operate such a sophisticated assembly line. Training is not cheap.
                      The US as well as other countries from West has shown great concern about industrial processes that could have been transferred to India, once it may be used in other aircraft such as the FGFA and specially in the PAK FA from Russia.

                      By the way such automated process can increase productivity and could reduced costs, as well as it could be be very efficient with purpose of the increasing of the quality parameters of the new projects.

                      However in my humble opinion the India had been chosen the Typhoon and the Rafale F3 in the short list of MMRCA program in reason of the both fighters has been using industrial processes highly advanced that could quite useful in the future programs from India.

                      Training is not cheap because it always has been implies such level of the transfer of technology, and in this case there are always obstacles in both sides , specially by who owns the knowledge of technology and they are not very happy to transfers the same, then the obstacles has been arisen to change the process.

                      Comment

                      • TomcatViP
                        Rank 5 Registered User
                        • Nov 2011
                        • 6110

                        Originally posted by Loke View Post
                        Very funny.

                        Brazil is a partner not a regular customer. And in any case, all companies base their whole business on transferring the cost to the customer -- who else should cover the costs? Show me a company that that gives away things for free...
                        I think you're mixing Price (hence profit margin) and cost. IKEA business analytic (as yourself can do it while sweating to get the thing properly done before the patience of your gf/wife and kids reaches an end) clearly ends at lowering the cost of manufacturing, transporting and fixed assets.



                        The problem is that cheap doesn't mix well with a lower output in mil aero. There are long term investment that can't be cut and I feel like there are traces of that in what was shown of the manufacturing line. It's my own opinion obviously but you will understand that if I am right, any HAL engineers that have been part of the program since its inception won't have much difficulties to draw the same conclusion.
                        Last edited by TomcatViP; 30th March 2016, 23:40.

                        Comment

                        • Vnomad
                          Rank 5 Registered User
                          • May 2011
                          • 2859

                          Originally posted by Loke View Post
                          I think you are wrong; there is no special "appeal" with an assembly line of a product that is going out of business. Although it may be more attractive than not having an assembly line at all.
                          Not just the assembly line, the airframe production will likely be shifted too, with just the mission systems continuing to be imported. TASL (Tata) right now produces aerostructures for the C-130J, full airframes for the RUAG Dornier, fuselages for the Sikorsky S-92 and now full fuselages for the Apache and fuselage components for the Chinook. And Airbus has partnered with them to produce the C-295 (as and when the contract comes through).

                          Building the airframe for the F-16/SH (in addition to assembling them) would be right up their alley. No HAL-type issues to worry about for the OEM.

                          Perhaps you believe that moving the SH assembly line and assemble X SH will be cheaper than building a new Gripen assembly line and assembling X Gripen? Look again at what Brazil is paying for their assembly line, including training and 36 Gripen. Compare that to the price of SH without the assembly line.
                          We know what the Brazilian state is paying Saab for the Gripens; we don't know what its paying Embraer.

                          The only off-the-shelf purchase with a publicly disclosed cost for the Gripen E was the Swiss deal where it was priced just under $150 mil/unit. The difference with the Super Hornet (judging from the RAAF's purchases) isn't that large.

                          In addition; although I doubt it, we should not discount the possibility that Saab may suggest to move the existing Gripen assembly line from Sweden to India.... From a cost-effectiveness point of view, that may make more sense, rather than having three assembly lines for such a small product.
                          That would be an interesting idea, but I don't think that would be politically palatable within Sweden. Especially if other parts of the production chain are also outsourced with that.

                          Comment

                          • Kaduna2003
                            Rank 5 Registered User
                            • Mar 2007
                            • 425

                            Originally posted by maurobaggio View Post
                            1.Comparative Table Brazil / Switzerland

                            Type Number of Gripen NG Amount of Contract (Billions) Unit Cost (millions)
                            Brazil Gripen E/F 36 Us$ 4.5 US$ 125
                            Switzerland Gripen E 22 US$ 3.233 US$ 147
                            Im not sure why the indian make things so complicated for themselves. Seems fairly simple to me:

                            1. Their first choice should be to add MKIs and LCA. And forget MMRCA completely.
                            2. And if they really really need to add another fighter to the inventory, they will not get a better deal then grippen (going by the table above).

                            how complicated is that really? There is red tape and then there is indian red tape!

                            Comment

                            • Ozair
                              Rank 5 Registered User
                              • Oct 2015
                              • 822

                              Originally posted by Kaduna2003 View Post
                              Im not sure why the indian make things so complicated for themselves. Seems fairly simple to me:

                              1. Their first choice should be to add MKIs and LCA. And forget MMRCA completely.
                              2. And if they really really need to add another fighter to the inventory, they will not get a better deal then grippen (going by the table above).

                              how complicated is that really? There is red tape and then there is indian red tape!
                              The problem with any Indian Gripen NG deal is it is not full multi-role until somewhere around 2023 or even 2025 and the Indians need jets as soon as they can get them.

                              Comment

                              • Loke
                                Rank 5 Registered User
                                • Jun 2008
                                • 3302

                                Originally posted by Ozair View Post
                                The problem with any Indian Gripen NG deal is it is not full multi-role until somewhere around 2023 or even 2025 and the Indians need jets as soon as they can get them.
                                Assumptions, assumptions...

                                Due to the long time it took to find an external partner (Brazil), the NG has been under development longer than most fighters, and has therefore advanced quite a lot. Expect it to be multirole pretty quickly after IOC.

                                In any case typical times to start delivery of a new fighter is 3 years, independent of manufacturer. The only exceptions to this rule is when another customer lets the new customer get their slot (as for e.g. Egypt receiving Rafales originally indented for France).

                                If contract negotiations takes 1 year, and if they decide tomorrow, then it means that whatever they decide most likely they will not get anything until 2020 the earliest.

                                In the meantime they could probably get some C/D airframes while they are waiting.

                                Comment

                                • Loke
                                  Rank 5 Registered User
                                  • Jun 2008
                                  • 3302

                                  Originally posted by Vnomad View Post
                                  The only off-the-shelf purchase with a publicly disclosed cost for the Gripen E was the Swiss deal where it was priced just under $150 mil/unit. The difference with the Super Hornet (judging from the RAAF's purchases) isn't that large.
                                  What you seem to ignore is that Sweden needed a partner to cover the Gripen E development cost; Switzerland decided before Brazil and was therefore going to be that partner; now it's Brazil instead. Being a "partner" has some advantages, however also one disadvantage, which is that one is expected to cover some R&D costs. Somewhat similar to what the F-35 partners are doing.

                                  In addition: I don't think Saab uses the concept "LRIP" however it it seems clear that, just like for F-35 the first 100 or so Gripen E will be more expensive than the next 100. Thus one should expect future customers to pay a lower price than what Switzerland would have paid for those very-early productions units (just like those countries who bought into early F-35 LRIP units paid a much higher price than those that ordered later).

                                  Comment

                                  • Vnomad
                                    Rank 5 Registered User
                                    • May 2011
                                    • 2859

                                    Originally posted by Loke View Post
                                    What you seem to ignore is that Sweden needed a partner to cover the Gripen E development cost; Switzerland decided before Brazil and was therefore going to be that partner; now it's Brazil instead. Being a "partner" has some advantages, however also one disadvantage, which is that one is expected to cover some R&D costs. Somewhat similar to what the F-35 partners are doing.

                                    In addition: I don't think Saab uses the concept "LRIP" however it it seems clear that, just like for F-35 the first 100 or so Gripen E will be more expensive than the next 100. Thus one should expect future customers to pay a lower price than what Switzerland would have paid for those very-early productions units (just like those countries who bought into early F-35 LRIP units paid a much higher price than those that ordered later).
                                    Basically what you're saying is that further orders for the Gripen E will have a lower unit cost. Maybe so. Then again, this doesn't help prove that the Gripen is significantly cheaper than the F-16V/SH. Not unless you know what proportion of its bids were earmarked for reimbursing R&D expenses.

                                    In fact, its quite possible that the R&D costs were not passed on to the customer, to help maintain cost competitiveness; better to make a modest profit by winning a contract, rather losing the contract after shooting for a higher margin. The Swedish govt too might have preferred to retain jobs and improve economies of scale, over recouping part of its investment.
                                    Last edited by Vnomad; 31st March 2016, 17:22.

                                    Comment

                                    • Spitfire9
                                      Rank 5 Registered User
                                      • Jul 2008
                                      • 2834

                                      Bulgaria will spend about BGN 2.42 B (EUR 1.24 B) to keep airborne its MiG-29s fighter jets and acquire new warplanes as well as patrol ships under a defence procurement investment plan approved by the government, the Defence Ministry said on Wednesday.

                                      The cabinet approved the three investment projects earlier on Wednesday.

                                      The investment project for securing the airworthiness of at least 10 Russian-built MiG-29s (eight MiG-29A plus two MiG-29 UB combat/trainer version) will be implemented in 2016-2017, the Defence Ministry said in a statement.

                                      The acquisition of new combat aircraft will be made in two stages. A contract for acquiring eight aircraft from 2018 to 2021 will be signed by the end of 2016. Another eight aircraft will be acquired between 2022 and 2023.
                                      http://www.defense-aerospace.com/art...-overhaul.html

                                      If that is it budgetwise, no way can Bulgaria buy new-build fighters. If second hand F-16's cannot be procured, the other obvious candidate is second hand Gripens. I imagine Gripen C is the most likely choice, specially since SAAB can offer to lease if required.
                                      Sum ergo cogito

                                      Comment

                                      • Loke
                                        Rank 5 Registered User
                                        • Jun 2008
                                        • 3302

                                        Originally posted by Vnomad View Post
                                        Basically what you're saying is that further orders for the Gripen E will have a lower unit cost. Maybe so. Then again, this doesn't help prove that the Gripen is significantly cheaper than the F-16V/SH. Not unless you know what proportion of its bids were earmarked for reimbursing R&D expenses.

                                        In fact, its quite possible that the R&D costs were not passed on to the customer, to help maintain cost competitiveness; better to make a modest profit by winning a contract, rather losing the contract after shooting for a higher margin. The Swedish govt too might have preferred to retain jobs and improve economies of scale, over recouping part of its investment.
                                        The best way to compare costs is to compare within the same competition.

                                        For some reason Gripen has hardly ever faced the F-16V in a competition. The SH it has faced several times however. One of the few datapoints we have is from Brazil:

                                        Defense Minister Celso Amorim and Gen. Juniti Saito, the air force's chief of staff, said at a press conference after the official announcement that the planes will be delivered in 4 years. The total cost of the deal will be $4.5 billion.
                                        According to figures previously reported in the Brazilian press, the overall deal offered by the French was around $10 billion including maintenance, while Boeing proposed $7.5 billion.
                                        http://www.ibtimes.com/president-dil...ghters-1514060

                                        Perhaps if SH had been chosen the Brazilians would have succeeded in reducing the original 7.5billion price tag; but by how much? I strongly doubt they would be able to get anywhere near the Gripen price tag.

                                        The operating costs for Gripen NG will also be significantly lower than for the SH. Operating costs is often forgotten in discussions like this.

                                        Comment

                                        • Vnomad
                                          Rank 5 Registered User
                                          • May 2011
                                          • 2859

                                          Originally posted by Loke View Post
                                          The best way to compare costs is to compare within the same competition.
                                          We don't know what the SH would have costed Brazil, if the deal hadn't collapsed in the wake of the NSA scandal. And we still don't know how much it will actually pay for the Gripen E. So there's no way of ascertaining the price gap between the two.

                                          However, fact remains, the option of transferring capital assets (that would otherwise be condemned) overseas, gives Boeing a major advantage in markets where fostering the domestic industry is an overriding priority for the govt (as may be the case with India). Had Boeing not been preparing to shut down its production line, the Gripen would most certainly have been the better choice.

                                          The operating costs for Gripen NG will also be significantly lower than for the SH. Operating costs is often forgotten in discussions like this.
                                          Trouble is operating cost is spread out over decades. It doesn't really strain budgets the way acquisition costs can over the short term. The annual cost of operating 36 fighters ($25K x 180hrs x 36 ~ $160 mil) is far outweighed by the cost of paying for 6 new aircraft delivered every year ($150 mil x 6 ~ $900 mil).

                                          Comment

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