Look at the NATO countries that require replacement or creation of a new air policing capability and there’s potential for real economies of scale if a joint approach is undertaken (and where there is not yet commitment to F-35):

Albania (new)
Denmark (F-16)
Belgium (F-16)
Czech Republic (JAS-39 Gripen – lease expiring).
Latvia/Estonia/Lithuania – new
Croatia (MiG-21)
Slovenia (new)
Romania – MiG-21
Slovakia – MiG-29
Bulgaria – MiG-21/-29/Su-25

That’s up to a couple of hundred aircraft.

And later on there’s Spain (F/A-18A/B) and Portugal (F-16A/B) – another 100 odd aircraft.

+1 Behold the Joint NATO Fighter Force

The J-35/Eurofighter/Rafale are over kill for many of these operators and too costly to operate.

The JAS-39 is perfect in terms of capability and cost effectiveness.

Pool the force together with strategically located squadrons and joint training/maintenance/logistics.

+1 Behold the Joint NATO Fighter Force

The F-35 was to be an F-16 replacement with similar purchase price and lower maintenance costs (in real terms). Thus far it has proved to be anything but so and there is no reason to believe that it will ever become so. It is a heavier MRCA aircraft with focus on a first day strike capability against adversaries with defended air space. That is its raison d’etre – US air superiority was to be handled by a large number of F-22 aircraft.

There are many who argue that in spite of F-35 costs being far higher than projected, NATO members should nevertheless order F-35 for the purposes of commonality with USA. Among issues that the advocates of universal adoption of F-35 by US allies do not address are:

(a) The cost. This promises to force those nations to cut back on other military capabilties ie skewing their overall military capability towards first day aerial strike capability.

(b) Some countries see their priority as defending their own airspace. All available western fighters also include a strike capability. Choosing an aircraft based on air defence needs does not imply that the country concerned must then buy an additional type in order to have an air strike capability.

The experience of the Libya intervention has led some to observe that the cost of tasking high end fighter/strike aircraft to pursue targets once enemy air defences are degraded is too high. The use of such costly resources is neither necessary nor sensible in a low threat environment.

I think that NATO/USA ally nations should organise air power interoperability on a two tier basis: F-35 for those who choose to pay the price and an F-16 class aircraft for those who either do not want to participate in US-led interventions around the world or simply cannot afford F-35. For the foreseeable future Gripen is the only F-16 class aircraft with a long term development path visible ahead of it.

First tier F-35 nations could participate in day one strikes and second tier Gripen nations could then take over. The strategy would be to use the right tools for the job at an appropriate cost.

I would also advocate pooling of resources for such an aircraft. Multiple independent training/maintenance resources do not make financial sense.

according to the swiss paper Tagesanzeiger (here), Switzerland will pay 100 M SFr. for 1 Grippen, opposit to Sweden which will have to pay 115 – 130 M SFr. (depending on equipement).

From the last paragraph of the article:

«Dieser Preis beinhaltet die Entwicklungskosten und den Aufbau einer gesamten neuen Produktionskette.»

“This price includes the development costs and the building of a completely new production chain.” (my translation)

This would explain the difference in price paid by Sweden and Switzerland (or some of it).

Exactly, the thorny issue is to bid costs time and money but not to bid makes you look less competitive.

To be honest any reply from Dassault or EADs might well be a paper shuffling exercise of brochures rather then anything significant.

Any contest would see F-35 and Super Hornet as front runners and to be totally hard nosed I see plenty of logic in that however much I would like to see Typhoon in RCAF colours!

Dassault and Eurofighter were prepared to match SAAB’s airframe price in Switzerland. I don’t think Dassault “needs” an order from Canada in the same way that Eurofighter “needs” another order to keep the line assembly lines open for many years to come. If Eurofighter do choose to bid, I wonder if they would be prepared to submit an extremely low deal price to try to get the business. Perhaps that would not make much difference since Typhoon is reported to have substantially higher operating costs than Super Hornet.

Why not? NATO does this for AEW, transport and to a lesser extent pilot training. Set up a pool of fighter resources, then base small amounts in each of the necessary countries.

Indeed. My point is that without a new approach, some countries can afford 0 new fighters.

The big attraction for the Gripen E program is significantly improved economies of scale. At the moment Sweden and Switzerland plan to buy about 80 at most. Increasing the number built by 50%+ would help a lot with unit costs.

If i may be allowed to add my 2 pence.

1. If indeed the Government of Canada has decided to dump the F-35, then for god sakes LM, pull all contractor work share from Canada, and hit them with a insane cancellation fee. There has to be a price paid for breaching contract.

I don’t think Canada has signed a contract to buy 65 F-35’s. Let them pull any arranged contractor share if they will.

3. Has anyone calculated typhoon 20 year costs? Hows is it that 2 typhoon engines are cheaper than 1 F-35 engine? How will parts be cheaper coming from 10 European contractors with a less than 500 order compared to a 1700+ order?

The Typhoon program has been badly managed by the governments concerned. That has certainly increased costs. By the sound of things, the Canadian government will try to assess lifetime costs for Typhoon or any other candidate.

4. Why didnt LM Go ahead and start on 100 planes a year even though the government cut the order, do they Not have the capital? if you cant sell the plane for under 100 mill you have an incompetent marketing division. Going with this plan they could have filled the SK tender, and likely get the Israeli planes of the line faster .
Like I mentioned before, if you can get the plane under 100Mill then a 20 mill backfit is not a program ending concern. Now you’ve done the worse thing for the program possible which is SCREW WITH THE ECONOMY OF SCALE

Building a large batch before development bugs are ironed out is a very risky thing to do. As for economies of scale, how much cheaper is the unit price for building 1700 aircraft compared with 600? It should be lower but I suspect not a great deal lower.

I for one wish the Canadians good luck. BUt a paltry 65 plane order is not in of it self the end of the F-35.

I don’t think anyone has suggested that a failure by Canada to order the F-35 would signal the end of the F-35. If the KPMG cost assessment is extremely high then it would suggest to Denmark and the Netherlands that F-35 risks being so expensive that it cannot be afforded. I suspect that when they look into cost themselves they will confirm that.

From the above link:

“The government has long maintained the F-35 was the only plane that met Canada’s needs. But last week, Gen. Tom Lawson, chief of the defence staff, told MPs that there are other planes with stealth capabilities.”

So, it seems that VLO is a requirement that can only be met by F-35… but that costs too much… so suddenly there are other planes with stealth “capabilities.” I think what the chief of the defence staff really means is that there are not any other western VLO aircraft available but since F-35 is unaffordable all other possible candidates will now be reclassified as having stealth “capabilities.”

Why not just be open about this and say that if Canada cannot afford the only stealthy aircraft available Canada will have to choose a non-stealthy aircraft that it can afford?

Now to the point: if one aircraft costs you $247.7mil throughout those 20 years and if we assume it spends 6,000 hours in the air (which is not even very likely), then one flight hour costs $41,283 in the best case.

To me the importance of coming up with a realistic assessment of cost is this: the political decision to order a particular replacement for CF-18 should be based on an accurate projected cost of the replacement. What had been given as the projected cost was clearly (seems to me) distorted to dupe the politicians.

Having hired KPMG, it would be interesting to see what they consider to be an accurate assessment of the cost of buying and operating 65 F-35’s. If they say $30 billion, so be it; if they say $20 billion, so be it. Let the politicians decide what to buy based on an independently calculated figure.

And let the same situation obtain in Denmark and Netherlands.