Price war unleashed ahead of IAF’s mega global competition, pitting 125 Million Euro Gripen against 216 Million Euro Rafale. The Gripen E hard sell: Starting its campaign early, SAAB wants affordability to be the biggest talking point in India’s mega fighter acquisition program

Sweden’s SAAB group made a bold, pre-tender pitch for an Indian order for 114 fighter aircraft by declaring that its Gripen E single-engine fighter is on offer for “half the price India has paid for the Rafale”. SAAB expects India to launch a global tender in the “first half of next year”.

The Rafale is a larger, twin-engined aircraft and therefore more expensive but SAAB is pitching its single-engine aircraft as a dramatically cheaper solution for the same role.

To illustrate its claim on a massive price advantage, SAAB disclosed its price bid for an ongoing tender for 64 fighter aircraft for Finland, also known as the HX Fighter programme.

In an online media briefing, Magnus Skogberg, Gripen Campaign Director for Finland revealed that the price offered for 64 Gripen E fighters is 6.5 Billion Euros, which includes the cost of a sustainment package for a decade as well as transfer of technology to Finland. The weapons package has been offered for an additional 1.5 Billion Euros.

This weapons package is similar in capability to the one India has acquired in the 7.8 Billion Euro deal for 36 Rafale fighters. It includes the Meteor, IRIS-T, KEPD-350 Taurus and the Spear.

The Finland tender also involves the procurement of two Airborne Early Warning and Control (AEW&C) aircraft along with 64 fighters. SAAB has offered two GlobalEye platforms at an additional 1 Billion Euros.

Skogberg expects the Finnish competition to be concluded and the winner announced later this month.

India paid an estimated price of 216.7 Million Euros (Rs 1,820.9 Crore) apiece for the Rafale in the 2016 deal. Without the weapons package, the cost was approximately 194.4 Million Euros (Rs 1,633.5 Crore). The current Gripen price, as disclosed by Skogberg, is 125 Million Euros (Rs 1,050.4 Crore) with the weapons package and 101.6 Million Euros (Rs 853.7 Crore) for the bare aircraft. In comparison, the contracted price of the indigenous Light Combat Aircraft (LCA) Mk 1A is Rs 578.3 Crore for the bare aircraft.

In 2012, the French Rafale was declared the winner of India’s elaborate competition to purchase 126 Medium Multi-Role Combat Aircraft (MMRCA). The Gripen was one of the contenders in that tender. At that time, it could not meet the technical requirements of the IAF. From a field of six competing fighters in what was billed as the ‘Mother of all Competitions’, only the Rafale and the Eurofighter were adjudged technically compliant by the IAF. Both the Rafale and the Eurofighter are twin-engined fighters.

The tender was aborted in 2015 reportedly over an impasse in contractual negotiations between Dassault of France and HAL for manufacturing 108 of the 126 fighters in India as per the terms of the tender. But India stuck by the IAF’s 2012 choice of the Rafale in making a stand-alone, emergency purchase of 36 Rafale fighters in 2016 for 7.8 Billion Euros off the shelf to bolster its sharply depleting airpower.

The Rafale procurement and commitment to the LCA and the futuristic Advanced Medium Combat Aircraft (AMCA) notwithstanding, the IAF’s requirement for six squadrons of a foreign jet persists. Given local limitations, acquiring six squadrons of a foreign jet through a manufacturing line in India is essential to the IAF’s plans to take its fighter aircraft strength to a minimalistic 35 squadrons by 2035. Its actual requirement is pegged much higher at 42 squadrons.

The Multi-Role Fighter Aircraft (MRFA) programme to acquire 114 foreign jets through transfer of technology under the ambitious Strategic Partnership model has to be seen in this context. The MRFA is poised to be a re-run of the abortive MMRCA with some changes. This time around, SAAB claims to have overcome the deficiencies because of which it was technically relegated a decade earlier.

SAAB is now extrapolating the figures in Finland’s HX Fighter Programme to India’s emerging competition - where the stakes are much higher - to provide contemporary comparisons. “We expect the RFP to be out in the first half of next year,” Mats Palmberg, Head of Gripen India Campaign, said.

SAAB is aggressively pitching its economy trump card and seeks to make the MRFA competition about reliability at low cost. “The Gripen offer ensures twice the number of fighters airborne at half the cost,” Skogberg boasted, claiming a winning combination of low price and high serviceability. In its bid for the HX Fighter Programme, SAAB has assured a minimum availability or serviceability rate of 78 per cent. “Over 50 of the 64 (offered to Finland) will always be available (to fly),” Skogberg said, disclosing further details about its offer to Finland.

He extended his economy pitch to operating costs. “The annual operational cost of the 64 Gripens to Finland will be under 250 Million Euros,” the SAAB honcho said. The SAAB offer requires the customer to commit an additional 2 Billion Euros for upgrading the fighter over its 40-year life cycle.

Palmberg, who seeks to pitch an offer to India at a price similar to that offered to Finland, rejects the view that the IAF’s firm commitment to the indigenous TEJAS - which seemed tentative a few years ago – will kill the market for foreign single-engine fighters like the Gripen and the F-16/F-21. “There’s room for more single-engine fighters,” the India Campaign head said, expressing hope that costs of acquisition and flying would not only keep the single-engines in contention but also be the winning card this time.

“There are two parts to our offer: Security of supply and the offer to help develop future fighters for India,” Palmberg said, responding to questions by this reporter. “We’ve offered help on a broad set of technologies,” he said, without elaborating the contours of the offer to assist India, which currently has the TEJAS MK-II and the fifth generation AMCA on the drawing board.