VnomadThere is a slight problem here: downtime. Manpower hours are not something completely de-correlated with the planed activity. If you have more maintenance hours (man hour can not be solved all the time by adding ppl around the airplane – some of the work to be done is iterative and might need full completion of another task to be itself completed).
So by being more labour incentive, the Typhoon might log more downtime, which in turn led to added airframe to complete the same job. Hence the added cost.But then it would be very difficult to make a rational comparison in the absence of info regarding the number for the Rafale .
What you’re describing is a long turnaround time leading to low operational availability, with the manpower bit being mostly an ancillary factor and NOT the root cause of the problem.
I have not seen any evidence of this issue and serviceability/availability stats for the RAF are broadly comparable to the AdlA’s. AFAIK the EF’s availability has been excellent during overseas deployments whether in operational roles or in exercises.
That’s a good post from Tomcat ViP, I hope he is clearer than I was as you said you had the issue in understanding my English. The idea developed was similar.
He may have clarified one of arguments wrt to maintenance but there’s still no evidence to support that contention. Also, it doesn’t contradict my point about lower labour costs in India also applying to skilled manpower.
VnomadI don’t limit “they deliver” on Rafales sold to IAF.. I speak in general… they announced that the production facilities they build will participate in producing the Rafale, but also parts for the Falcon series of bizjets, which means also benefit to export their production in the future. And even if they were there “only for Rafale”, it is work for a number of years to come and, as you say “they create” industrial capabilities, not just give some work to the already existing ones.
Well Reliance doesn’t fall within national auditor’s jurisdiction. And offset execution has been a controversial subject even before the likes of Reliance entered the picture. So the “wait to see if they deliver” declaration is meaningless without an effective audit mechanism.
Now about “fragmentation” being beneficial.. if you look at what happens elsewhere, the producers are eaten one after another by the stronger ones, so in the end, you have more or less a monopoly which is all but beneficial to the country… Just look at the F-35 development in the USA… it should’ve been legally terminated years ago and it’s still there…. why? mostly because they had good lobbying teams but also because they are pretty much alone on the market… who else could propose an alternative? Boeing?
If I see what’s happened elsewhere – the European manufacturers started a process of mergers in the 70s & 80s with the looming threat of their American rivals such as Boeing, leading to, among other things, the formation of the highly successful Airbus.
On the defence front, local corporations merged to form national/regional champions like BAE, Thales, Finmeccanica, EADS, but parochial concerns ensured that the European industry as a whole remained fragmented, leading to extensive duplication of effort and smaller economies of scale, which in turn resulted in an overall lack of competitiveness against US products.. such as the F-35, and the F-16 before that.
In India, similar concerns led to the formation of the Aatre panel which recommended a Strategic Partnership Model wherein one existing pvt sector entity with requisite experience was to be picked for every defence industry segment, so that it can build up the scale as well as core competencies to eventually become a national champion like other countries have. Eg. France – Dassault (military aviation & BJs), Airbus (civil aviation), Thales (electronics & others), Nexter (ground systems), Safran (propulsion), MBDA (missiles), DCNS (naval vessels).
The model was supposed to be implemented last year however, politically influential companies like Reliance & Adani entered the picture and made a play for market-share despite an utter lack of experience, leading to the SP model first being watered down to two companies per sector, before being shelved entirely.
VnomadSo did they eventually found any irregularities ? It is easy to accuse your political rival in a political speech but if something was really wrong what would have prevent them from revising L1 ?
The previous govt lost power, the CNC never submitted its report and the L1 status was never re-examined.
In any case, the salient point wasn’t the ‘political speech’ but the existence of the note written by the previous defence minister indicating that the genuineness of the L1 declaration was suspect.
If you want to claim that the GoI’s happiness has been ‘proven’ (never mind the bypassing of the MoD) go ahead but the claim about the Rafale being cheaper than the EF, while perfectly plausible, will require more evidence than that.
Your are wrong on 1) you conveniently did not adress my previous point on skilled workforce brain drain, training etc. If you look at the bigger picture, relying on a larger rare/skilled worforce has plenty of inconvenience which translates into much higher costs. Spares were to be manufactured in India so your point is also irrelevant. selective answer from your part for 2) see my answer above. Act not words.
I omitted that quote because I couldn’t make sense of your words. I simple put it down to our language barrier.
Simple fact is that a skilled work force in India costs a fraction as much as it does in the West and the scope to jump to the private sector is even smaller. That applies to operational manpower costs as well as labour costs in the manufacturing stage. What might be an issue for the EF in Europe is barely a hiccup in the Indian market.
VnomadIf they had zero problems, good for them, and..?
Dassault partnered with Reliance. They (Dassault) produce world class bizjets and fighters, so I’d say they DO know what they are doing.. rather than continuously questioning “did they do the right choice?”, or “why not somebody else?” how about some anonymous armchair would-be-specialists consider that these guys know what they are doing? If they fail to deliver, then one can say “they messed up”, until then, that constant baseless attacks are just blowing hot air
You clearly don’t get the purpose of a local partner & offset requirements (“if they fail to deliver, then..”). Its to create & further local industrial capabilities, generate employment and lower the forex burden on the state. Its NOT to ensure that the product is delivered on time or to spec. If that had been only concern – no offset requirements would have been specified.
Whether the actual localization was commensurate with the offset value, whether the further fragmentation of the private defence sector was beneficial to the country, whether Reliance’s actions to secure that partnership were above board, aren’t questions that get answered just because the Rafale deliveries are on schedule. And you may blithely dismiss it as mud-slinging but Reliance has a certain (and well deserved) reputation that will inevitably generate adverse publicity (as does Dassault for that matter).
Vnomadas I just answered TomcatViP, it is always easier to make things from scratch your way if you want them to be done precisely that way rather than ask someone to change
Change what? Airbus, Boeing, Lockheed Martin, etc. all require that the components sourced from their Indian partners are manufactured & processed exactly they way as specified by the OEM. None of them have had any complaints.
VnomadSame applies to any other partner in India.. the bigger aeronautical background they have, the more they’ll be tempted by their “internal policy” which is necessarily different from the one Dassault has (or anybody else, since, by definition, every country, and even every company in each country has its own).
So you’re saying that none of the other experienced engineering companies (that are functioning as subcontractors for the likes of Airbus, Boeing, Lockheed Martin, IAI, Samsung Techwin, Dornier etc.) were capable of following Dassault’s directions to execute the offsets? And only Reliance could really do the job because it had no experience at all? One has to wonder what kind of arrangement this is that Dassault has worked out with Reliance.
VnomadThe new government in place did not call into question the selection process which they could. I am pretty certain the new majority would have been pretty happy to point any irregularities from their rivals.
Oh yes they did!
This is a (translated) excerpt from Parrikar’s speech in the Parliament in 2016 –
‘Their defence minister* had put it in writing.. their defence minister used to be very worried that ‘these people’ would ruin his clean image… so he said in his note that “L1 status** is to be assumed, to go ahead with the CNC***, negotiate the price, finalize it and then bring it back to me where it’ll be checked where the L1 status is genuine or not.” I’ve never seen an approach like this in my life. But he was taking care of his own insurance. That the CNC might be a ‘Corruption Negotiation Committee‘ was a doubt he also must have had. That’s why he put all this down on paper.‘
– Manohar Parrikar
* i.e. the previous govt’s defence minister AK Antony
** lowest bidder
*** Cost Negotiation Committee
Fact is that in two competitions the Typhoon was deemed more expensive, deals structure were vastly different but both came to the same result.
On the contrary –
1. According to the Swiss gent the Eurofighter’s manpower costs were higher but it was likely to have cheaper spares. Which would make the EF more competitive in a country like India where labour costs were much much lower than the West.
2. As the testimony posted above proves – the Rafale’s L1 status in India had been earmarked for re-examination by the MoD with the negotiations proceeding on an ad hoc basis.
VnomadThe argument is false as in the MMRCA contract everything would have been manufactured in India. Note that Gygax said “possibly cheaper” as far as spares are concerned which is not even a clear cut. Then we are talking about skilled & rare work force to maintain engines, avionics etc…You have to train this workforce and avoid it to go in the private sector and this has a cost, even in India.
I’m afraid the manufacturing argument doesn’t hold up to scrutiny.
1. The Swiss weren’t going to build the aircraft locally; the reference was clearly to the operational manpower requirement. Nothing to do with manufacturing.
2. Skilled individuals are better paid than unskilled counterparts everywhere but the difference in manpower costs between Switzerland & India is still huge. In the ballpark of 5:1, on average, by my reckoning. Also, there’s no particular demand for aerospace experience in the private sector in India.
– The ‘skilled and rare work force’ argument isn’t helped by Dassault’s decision to partner Reliance instead of a company with real engineering experience and a work force that included skilled artisans & technicans.
– You cannot offer up Gygax’s opinions on manpower cost as conclusive evidence while simultaneously casting doubts on his (admittedly unenthusiastic) opinion with regard to spares cost.
– As far as the EF’s operational efficacy (including turnaround times) is concerned, it was judged technically compliant by the IAF after a very rigorous examination. Also, available public figures suggest that the RAF & AdlA fleets have roughly similar levels of overall as well as deployed fleet serviceability.
VnomadAsolutely not. GOI is fully entitled to award a single vendor contract for urgent needs and/or strategic needs. Normal procedure. I told you a bove. Forumers in India told us to expect a mudslingin campaign. Here it is.
I don’t know what ‘forumers in India’ have told you but that is NOT normal procedure. The DPP does provide exceptional measures for exceptional circumstances, but there is nothing normal about bypassing the MoD and announcing a deal without first determining its composition.
And given that the MoD spent two years in negotiating the contract (with the composition of a large part of the offsets deferred for later), the ‘urgency’ of the purchase is debatable. Asking Eurofighter to submit a competing financial offer under the same offset, delivery, warranty & customization requirements was perfectly doable.
The incumbent govt has also signed contracts for the AH-64, CH-47, M777, Barak-8, Ka-226, K-9, Heron etc and given DAC approval for the S-400, Talwar, A-330, C-295, without any particular fuss from the opposition. The Rafale deal has been singled out for mud-throwing is because its an easy and obvious mark. The unprecedented manner in which the deal was pursued as well as Reliance’s reputation for crony capitalism (and lack of engg. experience) gives it a degree of resonance with the public.
VnomadAs far as typhoon price is concerned this is what former Swiss air force chief of staff said back in 2013 :
“The spares are possibly cheaper because of the large number of aircraft, but it’s a very manpower-intensive aircraft,” he said.
Given the huge difference in manpower costs between Switzerland & India, it was just as likely that the cost of spares would have been the dominant factor when operating in an Indian environment. We know the flyaway costs quoted for the two were very similar (difference of less than $5 mil per unit).
Vnomadmfg at HAL was clearly spelled out in the RFP . Yes but not the actual setup nor the HAL views on how to fullfill this. ( contact to HAL were forbiden until L1 winner had been declared ) .
Source?
That makes no sense. HAL, while govt. owned, is a mostly autonomous company. Both HAL & BAE are in contact with it with respect to to the Mirage & Hawk programs.
Hence initial quote on manufacturing cost were based on projections ,backed up with own local manufacturing evidences from the manufacturer.
Therein lies the rub. If the quote was based on “projections” than there existed the possibility that similar projections made by Eurofighter were more conservative. Thus raising doubt about the sanctity of the Rafale’s L1 status.
Furthemore , from the follow up , one may conclude the governement nevertheless retain their trust to Dassault .
And the GoI is now facing some political heat for ignoring normal procedure by awarding a single vendor contract where there were two technically compliant entries. Also for bypassing the MoD & cabinet to sign the MoU at Paris, which handicapped the MoD in subsequent negotiations.
It doesn’t help that Dassault, instead of tying up with any one of half a dozen local defence engg. companies (like other aviation majors), chose to partner with a Reliance company, with core competencies in construction & power, and a certain reputation for shady business practices.
VnomadTrying a come back at -20% after your supposedly best offer to win the deal, sounds really fishy or else idiotic. Either case it was too late. Beside from a legal point of view it would have created serious issue to even consider such offer.
When EF came back with their revised offer the MMRCA deal with Dassault had already been stuck in negotiations for two years. Hardly surprising that they’d sense an opportunity.
While some raised concerns in regard to methodology and base used to compute COO (which should never have been made public in a context of a negotiations…..), in the end the cost issue was related to HAL based manufacturing cost projection, as reported by MOD.
No the basic problem was that cost negotiations should never have been a factor. The cost was supposed to have been identified in the competitive bid (mfg at HAL was clearly spelled out in the RFP). But because the bid turned out to be dodgy (eg. uncosted “misc.” items) the CNC stage became critical.
VnomadDo note that USAF F-35 procurement will be cut. Most probably this will happen by the way of reduced acquisition rate, this will drive the unit cost up.
The build rate is secure for the near future or at least the next 10 years. Its not going to impact Finnish/Belgian/Spanish/Polish acquisitions. There may be a scaling down post-2030 but by that time most of the (Western) competition will be out-of-production.
VnomadLikely a maintenance error. Probably wasn’t fastened down properly, popped open in flight and got sheared off.
VnomadNothing new in this letter. It simply mentions a 20% discount on Eurofighter which was talked during/just after MMRCA. The numbers given are pure speculation/misinformation. Few weeks ago, a former in India told us to w&ait for imminent mud slinging campaign. He was right
Only two memebers of the commission disareed on the cost calculation.
Every other agreed and selected Rafale as L1 bidder.
Not necessarily. That’s why the defence minister put it a note for procedural review (he’d realized something was awry and wanted to cover himself according to his successor). That there were uncosted elements in the bid has been confirmed by at least three sources. What the comparison with the EF would have been after including them is still open to question.
Case closed. The Rafale is cheaper than Eurofighter. (and F-35!!!)
The F-35? Very questionable at this point with the recent ramp up and the unit flyaway costs quoted from the Indian contract (€91.4 mil/€94 mil) and the latest Israeli one (~$90 mil, down from $112 mil in 2014 and $125 mil in 2011).
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