VnomadAssuring themselves is exactly what governmental bodies do negotiating with foreign counterparts upon procedures to compute costs and profit margins in a manner as neutral as possible with regard to currencies fluctuations.
Signing an agreement at the prevailing exchange rate is a perfectly neutral way to conclude the deal. Unlike a private business, the respective govts can directly influence the value of their domestic currencies, so putting in a currency buffer actually disincentivizes fiscal rectitude.
By default, it works the other way around as you are suggesting: they deal costs and profits taking in the foreground respective currencies, then agree to perform payments in a 3rd party currency as US Dollar, Yen, Euro.
They do their national/state budgeting in their domestic currency. International negotiations in contrast usually use USD as the unit of barter.
They do not deal in dollars or other foreign currency to end with payments in own currencies.
Nobody’s suggested that, least of all me.
Of course a safety bracket is most of the time there to allow fluctuations to freely happen to a limited degree, and thresholds are there as well to stop any compensating procedure if fluctuations becomes so ample to make them no longer agreeable by the parties involved.
Small currency fluctuations can be again be written off by the respective govts, without needing to split the risk or involving the private sector to insure against it.
VnomadAre you suggesting governmental bodies do not take care in a multi years contract currency fluctuations even when dealing with partners using a 3rd party currency?
Businesses can do that. Govts the size of Russia and India on the other hand effectively insure themselves.
By that line of thinking, any non US administration would not be able to foresee and plan expenditures at all.
They do the best with the information they have at hand. Not just currency fluctuations, but plenty of factors from international oil and commodity prices to trade disruptions and natural disasters, have the potential to wreak havoc on carefully planned budgets.
In this specific deal, Rupee has lost around 1/3 of its value against US Dollar in the last 10 years, with several fluctuation endured meanwhile.
The responsibility for which lies primarily with the Govt of India, as does the power to rectify the situation. Failing which it has no choice but to shoulder the additional fiscal burden.
VnomadAhem, aren’t israeli installing some of their own stuff on it? Or do they still pay for the complete plane?
They’re installing add-on EW equipment and they’ve signed additional contracts with LM for its integration. But they’re not getting a discount on their order if that’s what you’re implying.
VnomadNow, Scooter et al, what is the price of F-35A for delivery in 2017? Is it $150+ million? $150 million? $125 million? $100 million? Less than $100 million? You don’t know, do you? LM don’t know, do they? Yet you assert that unquestionably the best thing for the European F-16 users to do (where their armed forces biggest ticket item is an F-16 replacement) is to commit to F-35 whatever the cost.
Israel:
$2.75 billion for 19 F-35
$144 mil/unit
Flyaway cost $96 mil/unit
Delivered from LRIP 8/9/10 (2017)
VnomadUntil official statements reporting the actual price calculation formulas would be released, there is no clue at all about both how prices were computed and actual payments performed.
Even when a conventional currency is used to perform the actual payments, there is no limits to the range of counterbalancing mechanisms adopted to prevent wild value’s fluctuation to represent a risk to all the parts involved.
Fund transfers need not necessarily be in USD but international defence contracts of the type are almost always negotiated in dollars.
Any value expressed in USD, GBP or Euro should be taken as a conventional exemplification aimed at the general audience only.
Smaller entities would be expected to hedge against currency rate fluctuations, but not an agreement signed between two govts in a non-national currency.
VnomadThe figures given are for the aircraft to be procured in 2014, not aircraft already delivered.
The procurement cost is for the aircraft currently being delivered to the USAF i.e. 19 aircraft. The delivery rate ought to be higher for a batch being delivered three to four years from today.
VnomadOnce more and this would be the very last one. For Amrikhan, USD is the ‘constant’. For the Europeans, Euro is the ‘constant’. For the Brits, Pound is the ‘constant’. And for us poor Indians, it is the INR which is the ‘constant’!
I can understand your loyalty to the USD, but do wake me up when India starts budgeting in you favorite USD.
No amount of verbal gymnastics on your part will change the fact that defence deals between Russia and India are negotiated in USD not in INR. Next you’ll be claiming that the contract document was drawn up and signed in Hindi.
VnomadDo you realize that this vision repose only on a personal analysis. Mil planing is all about adapting to the feasible. Frankly with that kind of thinking, let’s say it straight, the only things most Eu countries need are stealth armed bicycle (nearly).
I have no idea what any of that meant. Economically feasible? Militarily feasible?
The Irish don’t have an fast jet fleet. Should they be worried about the Russians invading (perhaps on their French built Mistrals)?
VnomadFrom defense-aerospace.com:
The cost estimates in the NDAA for the cheapest version of the F-35, the Air Force’s F-35A, are the following: (Note these costs as just for production and do not include R&D.)
The 2014 procurement cost for 19 F-35As will be $2.989 billion. However, we need to add to that the “long lead” money for the 2014 buy that was appropriated in 2013; that was $293 million, making a total of $3.282 billion for 19 aircraft in 2014. The math for unit cost comes to $172.7 million for each aircraft.
For the Marines B, or STOVL, model, the authorized 2014 buy is six (6) aircraft for $1.267 billion in 2014 procurement, $106 million in 2013 long lead money, and $147 million in 2014 aircraft procurement modifications. That calculates to $252.3 million for each one.
For the Navy’s C, carrier-capable (but not yet), model, we get four (4) aircraft for $1.135 billion, plus $32 million in long lead, plus $31 million in modifications. That means $299.5 million for each one.
Anyone disagree with this cost info?
Its missing a critical detail – what LRIP are these costs for? Is this cost for the aircraft contracted this fiscal or aircraft delivered? There’s been a huge drop in the cost of the aircraft over the most recent LRIPs, which is likely not reflected in the budget for the 2014 procurement.
VnomadBasically Norway is getting a fighter in the same class as an F15 (at least when counting weight and thrust).
I for one hope that the lessons learned from Allied Force and Desert Storm make Denmark pick a fighter that is sustainable in longer operations, like F16V or Gripen.
In other words, NATO members are being saddled with an aircraft in the same class as that which was previously unanimously rejected, and this in an era of much greater spending and facing a far more credible and formidable threat.
The basic premise of this argument is flawed viz. an aircraft’s replacement should be in the same weight class. Case in point – all the aircraft the F-16 replaced; F-86, Hunter, F-5, F-104, were considerably smaller and lighter.
As things stand, the F-16’s replacement is clearly the F-35. And as far as the argument for opting for the least common multiple goes, that could be used against the F-16 purchase as well – the F-20 Tigershark was a substantially aircraft capable of performing the entire spectrum of air operations that the F-16 could.
However today’s threat scenario is radically different from the Cold War days, especially for European air forces. In that context, the F-35 could justifiably be perceived as overkill, but then so can the Gripen and F-16 if the objective is merely QRA. For that matter, even if they retired their fast jet fleets, the security of the EU or NATO would hardly be compromised.
VnomadHAL will have it’s own engine production line.
Its probably not being built from scratch. They’ll still be sourcing components directly from US based suppliers, lowering the production costs for GE.
VnomadOne point to consider inteasd of two. Klimov is very profitable business due to its helicopter engines. it has very effective R&D. that’s why its 3D thrust vectoring technology is used. and it built completely new plant in St Peterburg.
Klimov’s profitability is not under discussion and the only 3D thrust vectoring engine in production is built by NPO Saturn.
If RD-33MK was to heavy it would not give the level of performance for the enlarged MIG-29K. which carries 50% more fuel than standard MIG-29 and has much enlarge cockpit, spine and wing area and airframe stressed for 5 wet stations.. MIG-29K has same relationship to MIG-29 like F-18E is to F-18C.
You’re the only one on the thread discussing the MiG-29 and F-18. Its obvious to everyone else on the thread that the performance of the engine is distinct from the performance of the aircraft. The most technologically advanced engine (P&W F135) is installed on an aircraft that’s not particularly nimble.
When you said ‘I think [the F414] is very heavy relative to thrust’, your brain obviously wasn’t in gear. Fortunately, you’re wrong on such a regular basis that no one expects any better from you.
VnomadIf engine manufacturer is quoting 1055 kg, what is the issue? If you increased thrust by 10% and weight by 10%, then there is no improvement in T:W ratio. So you are saying engine technology is russia has not improved in 30 years?
Issue is that the weight quoted is for the baseline RD-33. Had it even been 1065kg, it might still have been a feasible figure, but here its clearly a case of figures not being updated (I’ve posted the Klimov product catalog where the updated figures are available).
Coming to engine technology, two points here.
One the MiG-29 has not consistently been in production like the Su-27 family, so the AL-31 development is a better reflection of Russian engine technology than the RD-33. Secondly, the RD-33 derivatives don’t necessarily have to feature an increased T/W ratio. Higher thrust in the same volume is valuable. Even if the increased thrust of the RD-33MK is accompanied by a weight increase, the net T/W ratio of the aircraft still increases.
F414 EPE is supposed to increase thrust by 20% and you dont believe it also?
Did they say that the F414 EPE weight is exactly the same as the GE-F414-400?
VnomadNone of the other rubbish in your post bothers me and all along since you first quoted me (even after I stopped quoting you), I was specifically looking if you will clearly reply to this one – Value of INS Vikramaditya in 2013. That was/is the only point of interest to me in your reply.
Swerve didn’t solicit your ‘humble advice’ and its quite evident to everyone that you wanted to post a reply while pretending not to, by addressing it to another member.
How did the Indian Navy arrive at the figure in Indian Rupees. Mr.Expert? What is/was the magic formula?
How do you think they arrived at the figure? :rolleyes:
Do you atleast now get a sense of what you were typing? Do you still believe your reply had any relation to the value of Vikramaditya 2010 and 2013?
What makes you think the contract value in INR stated in a MoD or Navy press release is not subject to change, as a result of a rises or falls in the prevailing exchange rate?
The above quote and value is the only thing of interest to me, because you went on to claim that the value of Vikramaditya provided is wrong and it should be $2.3billion in 2013 as well. You have not yet given a clear reply and goes around typing something else skipping this specific one and the reason why I replied to swerve
There’s no ambiguity here. The dollar value is constant and the rupee value depends on the exchange rate.
VnomadYou are again quoting me. 😀
If you make a reference to a post of mine, I will respond.
You quoted figure of 1,055Kg from the Klimov website which they had given for their RD-33 family and not specifically to the variant.
Now just a simple request…. find me the dry engine weight of RD-33MK that was specifically given by Klimov in their website below. There are only two links which are very clear. Quote the figures provided by Klimov for RD-33MK.
I’ve posted the links. If you think you can prove that the weight of the RD-33 didn’t increase by a single kilogram with the thrust increasing 10%, please go ahead.
Wrong!
I’m sure it will be hard for you to admit anything and will continue with your trolling….
If you have an issue with my ‘trolling’, either report me to the mods or keep your trap shut.
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