Spitfire9What will happen if GoI pays for ToT but gets non? It is an experience from past in relation to different deals. While cost is jacked up because of sharing the know how but when it come to sharing either it is partial or wrong blue prints or wrong tooling. How do we find it out what is right or wrong? We do not find it out until we fit together all pieces and it is already late in the program. So lengthy and costly delays …
Coming to HAL, they can make mistakes in reading blue prints and manufacturing tools or following process etc. That is where consultancy for ToT comes into play. Dassault has the knowledge and must advise HAL to fix those issues early. So that final product can deliver on time with quality to the customer (IAF).
GoI or MoD has no interest in invoking penalty of 500 million $ after investing 15b $ plus cost of other resources into program. But at the same time we will not allow people leave the room after getting paid without doing any productive and quality work.
It helps a lot if you are dealing with a company that observes the spirit as well as the letter of a contract. I guess it must be very difficult to judge whether you are receiving all the knowledge you need if you do not have that knowledge already to be in a position to judge if it is all being passed on to you. Something along the lines of trying to judge whether you have received all the unknown unknowns you had set out to receive.
Perhaps some of the money is to be held back until India gives final acceptance that the desired TOT is established to have taken place?
Spitfire9No Rafale MMRCA deal this year says Indian Defence Minister
http://frontierindia.net/rafale-mmrca-deal-year-says-indian-defence-minister#axzz2sX7nhRfq
Pretty much the end of the saga I imagine. Surely even further delays = even further cost rises = even smaller chance of a deal?
In the shorter term (next 5 years) I think India should reduce risk by ordering another couple of squadrons of Su-30 and two or three more squadrons of Tejas Mk1. Tejas Mk1 production can be accelerated to enable remaining MiG-21’s to be retired as programmed without a big fall in squadron numbers.
Perhaps India ends up buying a few dozen off the shelf, as with M2k
IAF sees a need for a medium weight MRCA. AMCA will not be available before 2025 so it’s Rafale or nothing until then IMO.
Setting aside the problems associated with a big ticket item being subject to a considerable increase in cost (a doubling in cost from $10 billion from $20 billion has far more impact on the defence budget than another project doubling in cost from say $250 million to $500 million), the insistence that Dassault be financially liable for shortfalls in HAL assembly remains unrealistic to me. If being responsible for assembly of French-made parts by HAL is seen as being a bad commercial risk by Dassault how much worse does it become if there are delays by local sub-contractors in producing indigenised parts for Rafale? Is Dassault going to be held financially responsible for those shortfalls, too? I recall that when Boeing farmed out a large part of 787 component production it was not possible for Boeing to control sub-contractors that were not coming up with the goods. In one or two instances Boeing ended up buying the sub-contractors concerned in order to get things in-house and on track again.
The riskier India makes things for Dassault, the more expensive Rafale becomes. That’s inevitable – higher risk means a higher return is sought. It should be remembered that Dassault is a company that makes most of its profits from civil aviation and software. While a Rafale deal would be very nice at the right price the future of the company does not hinge on doing a deal with India (or any other country).
I imagine that Dassault might well prefer to sell a few dozen Rafale off the shelf rather than 2 or 3 times as many with all sorts of potential headaches because of weird and wonderful contract terms. Or the government of India could take the view that it is actually responsible for the performance of HAL, a company that it owns and controls, rather than some other entity that neither owns nor controls it.
Spitfire9About IAF squadron strength in the years up to the end of this decade:
With uncertainties surrounding the time frame for the Rafale contract at this juncture, the IAF must plan to order at least another six squadrons of the Su-30MKI, possibly with upgrade to fifth-generation capability. The IAF must also vigorously pursue the LCA Tejas option with primary focus on the Mark I while continuing development of the LCA Tejas Mk II. It goes without saying that the IAF must also continue to vigorously pursue the procurement of the MMRCA.
http://www.sps-aviation.com/story_issue.asp?Article=1379
I think I will reiterate my previous position, being that to cover the risk of delays in MMRCA deliveries it would make sense to boost Tejas Mk1 production rates and orders. The fact that HAL is planning production at a low level is neither here nor there. It should not be difficult to substantially increase the production rate from 2016 if a decision were made to do that now. If the alternative is more Su-30’s at a much higher cost, why ignore the cheapest way to mitigate the problems brought about by the risk of non-availability of Rafale?
Spitfire9Read and weep.
http://www.sps-aviation.com/story_issue.asp?Article=1379
NEW DELHI — Negotiations over the multibillion dollar deal to sell 126 Dassault Rafale jets to India have stalled, according to Indian Defence Ministry sources, who say the sticking point involves issues governing license-production of the jets at state-owned Hindustan Aeronautics Ltd. (HAL).
A series of meetings held over the past three months have failed to resolve the stalemate, the sources said, meaning it is unlikely the deal will be finalized during the current New Delhi administration.
Spitfire9So BAE Systems declined to bid on a Naval Gun contract for the Indian Navy. From Janes:
Industry sources interpret “disproportionate risk” to include BAE Systems assuming production and quality control guarantees and delivery schedules for India’s state-owned Bharat Heavy Electricals Limited (BHEL), which will build 10 of the 13 guns via a transfer of technology.
BAE Systems would have no functional control over BHEL, but it would be penalised for the latter’s nonperformance.
This sound familiar to anyone else?
Oui…
Spitfire9And all of the findings within the OT report are repeats of issues which were self-reported by test personnel from LM, PWA, NG and BAE.
So it was LM that reported F-35B Block2 software was going to be 13 months late. Good to hear that they volumteered the information.
Spitfire9Where does that leave AKAER who I thought were selected to produce the centre and rear fuselage?
Spitfire9The price hike would mean that the deal would cost India nothing less than $28-30 billion (Rs1.75 lakh crore-Rs1.86 lakh crore),” said an Indian Air Force (IAF) official, who is privy to discussions of the cost negotiation committee.
The defence ministry headed by AK Antony has developed cold feet after the cost doubled compared to the original estimate. With the general elections just months away, Antony is unsure about the fate of the deal, a defence ministry official said. “As the negotiations continue, the cost is spiralling out of hand. It is a major worry,” he said.
As often is the case unidentfied sources who should be “in the know” are cited so their reliability is unknown but if one assumes that they are credible the Rafale deal looks to be in deep trouble. If the defence minister is no longer convinced that the deal makes sense given the cost escalation (whatever the reason for that escalation) I think that no contract will be signed until he can be convinced again.
As for looming elections, will the MMRCA cost be seized upon by politicians if AK Antony does agree to signing a much more expensive deal than was anticipated? I think the existence of Tejas presents further problems on the political front – rival politicians can argue that Tejas can be bought instead, some reasons in its favour being that it is
(a) Indian
(b) much, much cheaper to buy
(c) the right aircraft to replace MiG-21
Spitfire9What I tried to point was that the way that this extract of the report was written is partisan.
Mind telling me what is partisan about the person appointed to test and evaluate the F-35 predicting that the F-35B will be delayed because – as the article puts it – “the necessary software, Block 2B, will not complete developmental testing until November 2015 or be released to the fleet until July 2016, 13 months late. Since an operational utility evaluation (originally set for May 2015) will then be needed before IOC, the aircraft would not be operational with the Marines until late 2016 or early 2017.”
It is not the job of the director of operational test and evaluation, Michael Gilmore, to cosy up to LM and rubber stamp their invariably false predictions about their progress with the F-35. It is his job to test and evaluate and to come up with realistic predictions ie non-partisan predictions. Since LM is the contractor there is a temptation for LM to be anything but objective in releasing information about their performance where their product is concerned. LM’s PR dept has time and again demonstrated that objective self-analysis is not on the agenda and that the company is entirely partisan in its approach to the F-35.
If Apollo 13 had been crewed by LM PR people I think the words used over the radio link would have been “Houston, we don’t have a problem.”
Spitfire9Lockheed F-35 Develops Cracks, Pentagon’s Tester Finds
Lockheed Martin Corp.’s F-35 jet developed cracks in testing of the fighter’s durability and wasn’t sufficiently reliable in training flights last year, the Pentagon’s chief tester found.
On-ground testing of the Air Force and Marine Corps versions of the fighter revealed “significant findings” of cracks on five occasions in fuselage bulkheads, flanges, stiffeners and engine mounts “that will require mitigation plans and may include redesigning parts and additional weight,” according to an annual report on major weapons by Michael Gilmore, director of operational testing.
Behind the Threatened F-35 Delays
Could have been worse” is probably a good four-word summary of the latest Joint Strike Fighter report by the director of operational test and evaluation, Michael Gilmore. If you paid attention to Gilmore’s congressional testimony on June 19 (too few people did), or to our coverage, there is little shocking news.
On the other hand, if you were confidently expecting the program to make the scheduled initial operational capability dates announced last May (too many people were), the report is a cold shower, making a strong case that those dates may be missed by a year or more.
Gilmore’s team is most specific on the first planned IOC, for the Marine Corps. The current objective date is July 2015 (objective) and December 2015 (threshold). The report predicts that the necessary software, Block 2B, will not complete developmental testing until November 2015 or be released to the fleet until July 2016, 13 months late. Since an operational utility evaluation (originally set for May 2015) will then be needed before IOC, the aircraft would not be operational with the Marines until late 2016 or early 2017.
Spitfire9Lockheed F-35 Develops Cracks, Pentagon’s Tester Finds
Lockheed Martin Corp.’s F-35 jet developed cracks in testing of the fighter’s durability and wasn’t sufficiently reliable in training flights last year, the Pentagon’s chief tester found.
On-ground testing of the Air Force and Marine Corps versions of the fighter revealed “significant findings” of cracks on five occasions in fuselage bulkheads, flanges, stiffeners and engine mounts “that will require mitigation plans and may include redesigning parts and additional weight,” according to an annual report on major weapons by Michael Gilmore, director of operational testing.
Behind the Threatened F-35 Delays
Spitfire9Taiwan and Rafale?
Giving the no-go for the F16 upgrade from the DoD, doesn’t anyone see a runway opening for the French jet?
Or BAE perhaps? They can upgrade F-16’s.
Spitfire9…with a domestic funding crunch and inflation, coinciding with the maturity of a few local programs, the domestic aviation industry may finally achieve critical mass, which bodes well for the future.
I don’t know what the medium term prediction is for the rupee but if it continues to weaken the argument for developing/buying local weaponry becomes stronger and stronger. AMCA becomes more and more appealing. Fortunately for Dassault AMCA EIS is so far into the future that if a medium weight fighter is needed pre-2020 Rafale remains the best option.
Spitfire9For 4,8 billion $ Iraq should buy a lot of additional Mi-28NE (50+) with all weapons, trainings, etc and they are no worse than Apaches they will buy for so much money. With money for leasing 6 AH-64D, they could as well buy a squadron of Ka-52, not only lease.
Well the good old US of A has spent thousands of millions of dollars invading Iraq to crush the non-existent Al Quaeda threat they perceived, ignored the advice of allies such as the Brits who pointed out that you need to plan what to do after military victory is achieved, created an Al Quaeda threat by their incompetence as an occupying force, were instrumental in bringing about the deaths of thousands of civilians… and want nice profitable military contracts for US manufacturers as a reward for their “help”
Spitfire9The $65M figure for the Rafale does seem dodgy. Perhaps it was the projected price once the production rate is boosted, but yes its unlikely.
The total contract value on the other hand seems to be well in line with what the article suggests. Between the flyaway cost (of say $100M), spares, training, support and local production, it’ll start closing in on $20 billion. Add in licensing, ToT & offsets, and it’ll shoot well past that figure. Finally, compute the cost of a Rafale-specific munitions package – MICAs, AASMs, Meteors…. it’ll be nothing less than $5-6 billion (just MICAs for 50 Mirages costed $1.25 billion @ 5 missiles/aircraft).
A final bill for $28-30 billion would be on the higher side, but not very surprising.
IIRC during the competition the projected MMRCA deal value was reported to be $10.4 billion for 126 aircraft. Setting weapons, ToT, licensing aside, the package you describe more or less doubles that figure. Add in the extra cost due to currency movement and the cost in rupees for 126 aircraft + support looks to be more than 2.5 times the projected cost that had been reported. An increase of that magnitude may be well be queried by the bean counters.
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