On the 11 June the first single-seat Gripen C destined for the South African Air Force flew for the first time. Flown by Saab test pilot Richard Ljungberg the aircraft took off from Saab's facility at Linköping in Sweden at 13.00 and touched down safely back at Linköping at 14.03 in the afternoon.
The Swedish Chief Prosecutor Christer van der Kwast decided on 16 June to close the preliminary investigation into Saab concerning alleged illegal methods in connection with the sale of Gripen.
Gripen participated in a multinational exercise conducted over northern Sweden between the 8th and 16th June. Air Forces from ten nations participated in the NATO-led operation Loyal Arrow to train methods for quick reaction and the ability to participate in international efforts.
The Annual Report on offset performance for 2008 has been approved by the Czech Ministry of Defence. The report concluded that the Gripen industrial co-operation programme in the Czech Republic generated CZK 4.94 billion in export value for the country.
On 2 June, Saab attended a conference on Swedish- Brazilian Industrial co-operation being held in São Paulo, together with the Brazilian Industry association, FIESP, and the Swedish Trade Council.
Saab is prepared to shift as much as 50 percent of future Gripen production to the South American country, where the main competition to provide 36 warplanes is from Boeing Co.’s F/A-18, Bob Kemp, marketing chief for the $50 million plane, said in an interview. Final assembly work has already been offered to Empresa Brasileira de Aeronautica SA, or Embraer, he said.
Saab is betting on the Brazilian order to rescue the flagship Gripen as the production backlog shrinks. Winning the contract, which may be awarded as early as next month, is crucial to establishing the model as the warplane of choice in markets not already dominated by Boeing and Lockheed Martin Corp., which is grabbing market share with its F-35.
“Maybe in the future Brazil will become the leading exporter of the next-generation Gripen,” Kemp said yesterday by telephone from Linkoeping, Sweden, where Saab is based. “This fits perfectly with their strategic ambitions. We are looking at six or seven major defense companies that have the potential of offering equipment for our aircraft.”
Saab fell 0.9 percent to 57.25 kronor in Stockholm trading. The stock has declined 20 percent this year, giving the company a market value of 6.42 billion kronor ($812 million).
Recommendation
Brazil’s defense ministry said that final bids for the contract were submitted last month from Boeing, Saab and France’s Dassault Aviation SA, which is pitching the Rafale. The air force will make a recommendation to Defense Minister Nelson Jobim in early August, with the final decision in the hands of President Luiz Inacio Lula da Silva.
Saab may be able to fend off Boeing because it can transfer more technology to Brazil than the Chicago-based company, Kemp said, adding that the Gripen costs about 20 percent less than the more-sophisticated F/A-18 and is better matched to Brazil’s need for a low-maintenance fighter able to operate in small numbers from widely dispersed airfields. Spare parts and maintenance may also cost one-third less, he said.
While Brazil’s initial requirement is to replace a batch of aging Mirage jets made by Paris-based Dassault, the country may need as many as 120 planes, Kemp said, each with a life of as many as 40 years.
‘Weak at Home’
“In terms of value for money the Gripen is a superb aircraft, but Saab is at a terrible disadvantage in not having a strong home market,” said Richard Aboulafia, vice president at Teal Group, a Fairfax, Virginia-based consultancy.
While the model has so far won 250 orders, 204 of them are from Sweden, where some planes have been leased out as the government reins in defense spending.
The future of the 1,320 mile-per-hour plane will be determined by purchases in Brazil, India and Switzerland within the next 18 months, Aboulafia said. Saab may need to provide more inducements because it can’t match the offset work that Boeing can offer in fields such as civil aerospace, he said.
Brazil would be granted a full 50-50 partnership on development, production and marketing of the Gripen for export, the executive said, including the manufacture of high-value communications, display and avionics systems.
Saab has so far won only two export contracts for the Gripen, with South Africa buying 26 planes and Thailand taking six. Deliveries will run out in 2012 and output is down to 10 to 12 aircraft a year from about 15 previously, with suppliers including Volvo Aero, maker of the Gripen’s RM12 engine, already winding down production.
Broad Collaboration
Saab’s plan to develop an enhanced “next generation” Gripen means it can offer Brazil collaboration from the design stage on, unlike Boeing and Dassault, Kemp said. The size and status of the Brazilian aerospace industry makes a partnership feasible, he added. Embraer is the world’s fourth-biggest planemaker after Boeing, Airbus SAS and Bombardier Inc.
“I think there’s no question in the minds of Brazilians that Boeing’s product is the best and competitively priced,” Mike Coggins, senior manager for business development at Boeing’s defense unit, said by telephone from St. Louis.
It makes no financial sense to co-produce locally the 36 planes Brazil is seeking, although a larger order in the future may provide the necessary scale, he said. As part of its offsetting technology transfer package, Boeing will allow Brazilian companies to help develop future upgrades, he added.
Export Candidates
Argentina, Ecuador and Mexico represent possible export opportunities within Brazil’s immediate sphere of influence, Saab’s Kemp said, with aircraft replacement orders anticipated within the next five years.
The Gripen upgrade plan may work against Saab because Sweden hasn’t ordered the plane and that will make the model “tough to sell,” according to Teal’s Aboulafia.
Saab’s pitch to Brazil comes as the company focuses its marketing on nonaligned countries that aren’t already major customers for U.S. warplanes as the company seeks to sell at least 200 more Gripens abroad, Kemp said.
Norway dealt Saab a blow in November with a contract for 48 Lockheed Martin F-35s and the Netherlands selected the U.S. plane as the best candidate to replace 85 older aircraft a month later. Denmark may make the same choice this year. All three countries are partners on the F-35 program.
Among countries with no participation in the F-35, India is key, Kemp said, with a requirement for at least 126 fighter aircraft and perhaps as many as 300. Saab has proposed a deal in which it would build the first 18 planes and Bangalore-based Hindustan Aeronautics Ltd. would manufacture the rest.
“Our relationship with India is good,” Kemp said. “We want to transfer technology and allow the Indians to get on with it. Basically we would become a subcontractor to HAL.”
To contact the reporter on this story: Sabine Pirone in London at spirone@bloomberg.net
Wednesday, July 08, 2009
DTN News: Saab May Make Gripen Jet fighter In Brazil To Help Win Order
DTN News: Saab May Make Gripen Jet fighter In Brazil To Help Win Order
*Source: DTN News / Bloomberg
(NSI News Source Info) STOCKHOLM, Sweden - July 8, 2009: Saab AB, the Swedish maker of the Gripen jet fighter, is ready to make Brazil the manufacturing center for the aircraft to increase its chances of winning a $1.8 billion order and safeguard the model’s future. On the 11 June the first single-seat Gripen C destined for the South African Air Force flew for the first time. Flown by Saab test pilot Richard Ljungberg the aircraft took off from Saab's facility at Linköping in Sweden at 13.00 and touched down safely back at Linköping at 14.03 in the afternoon.
The Swedish Chief Prosecutor Christer van der Kwast decided on 16 June to close the preliminary investigation into Saab concerning alleged illegal methods in connection with the sale of Gripen.
Gripen participated in a multinational exercise conducted over northern Sweden between the 8th and 16th June. Air Forces from ten nations participated in the NATO-led operation Loyal Arrow to train methods for quick reaction and the ability to participate in international efforts.
The Annual Report on offset performance for 2008 has been approved by the Czech Ministry of Defence. The report concluded that the Gripen industrial co-operation programme in the Czech Republic generated CZK 4.94 billion in export value for the country.
On 2 June, Saab attended a conference on Swedish- Brazilian Industrial co-operation being held in São Paulo, together with the Brazilian Industry association, FIESP, and the Swedish Trade Council.
Saab is prepared to shift as much as 50 percent of future Gripen production to the South American country, where the main competition to provide 36 warplanes is from Boeing Co.’s F/A-18, Bob Kemp, marketing chief for the $50 million plane, said in an interview. Final assembly work has already been offered to Empresa Brasileira de Aeronautica SA, or Embraer, he said.
Saab is betting on the Brazilian order to rescue the flagship Gripen as the production backlog shrinks. Winning the contract, which may be awarded as early as next month, is crucial to establishing the model as the warplane of choice in markets not already dominated by Boeing and Lockheed Martin Corp., which is grabbing market share with its F-35.
“Maybe in the future Brazil will become the leading exporter of the next-generation Gripen,” Kemp said yesterday by telephone from Linkoeping, Sweden, where Saab is based. “This fits perfectly with their strategic ambitions. We are looking at six or seven major defense companies that have the potential of offering equipment for our aircraft.”
Saab fell 0.9 percent to 57.25 kronor in Stockholm trading. The stock has declined 20 percent this year, giving the company a market value of 6.42 billion kronor ($812 million).
Recommendation
Brazil’s defense ministry said that final bids for the contract were submitted last month from Boeing, Saab and France’s Dassault Aviation SA, which is pitching the Rafale. The air force will make a recommendation to Defense Minister Nelson Jobim in early August, with the final decision in the hands of President Luiz Inacio Lula da Silva.
Saab may be able to fend off Boeing because it can transfer more technology to Brazil than the Chicago-based company, Kemp said, adding that the Gripen costs about 20 percent less than the more-sophisticated F/A-18 and is better matched to Brazil’s need for a low-maintenance fighter able to operate in small numbers from widely dispersed airfields. Spare parts and maintenance may also cost one-third less, he said.
While Brazil’s initial requirement is to replace a batch of aging Mirage jets made by Paris-based Dassault, the country may need as many as 120 planes, Kemp said, each with a life of as many as 40 years.
‘Weak at Home’
“In terms of value for money the Gripen is a superb aircraft, but Saab is at a terrible disadvantage in not having a strong home market,” said Richard Aboulafia, vice president at Teal Group, a Fairfax, Virginia-based consultancy.
While the model has so far won 250 orders, 204 of them are from Sweden, where some planes have been leased out as the government reins in defense spending.
The future of the 1,320 mile-per-hour plane will be determined by purchases in Brazil, India and Switzerland within the next 18 months, Aboulafia said. Saab may need to provide more inducements because it can’t match the offset work that Boeing can offer in fields such as civil aerospace, he said.
Brazil would be granted a full 50-50 partnership on development, production and marketing of the Gripen for export, the executive said, including the manufacture of high-value communications, display and avionics systems.
Saab has so far won only two export contracts for the Gripen, with South Africa buying 26 planes and Thailand taking six. Deliveries will run out in 2012 and output is down to 10 to 12 aircraft a year from about 15 previously, with suppliers including Volvo Aero, maker of the Gripen’s RM12 engine, already winding down production.
Broad Collaboration
Saab’s plan to develop an enhanced “next generation” Gripen means it can offer Brazil collaboration from the design stage on, unlike Boeing and Dassault, Kemp said. The size and status of the Brazilian aerospace industry makes a partnership feasible, he added. Embraer is the world’s fourth-biggest planemaker after Boeing, Airbus SAS and Bombardier Inc.
“I think there’s no question in the minds of Brazilians that Boeing’s product is the best and competitively priced,” Mike Coggins, senior manager for business development at Boeing’s defense unit, said by telephone from St. Louis.
It makes no financial sense to co-produce locally the 36 planes Brazil is seeking, although a larger order in the future may provide the necessary scale, he said. As part of its offsetting technology transfer package, Boeing will allow Brazilian companies to help develop future upgrades, he added.
Export Candidates
Argentina, Ecuador and Mexico represent possible export opportunities within Brazil’s immediate sphere of influence, Saab’s Kemp said, with aircraft replacement orders anticipated within the next five years.
The Gripen upgrade plan may work against Saab because Sweden hasn’t ordered the plane and that will make the model “tough to sell,” according to Teal’s Aboulafia.
Saab’s pitch to Brazil comes as the company focuses its marketing on nonaligned countries that aren’t already major customers for U.S. warplanes as the company seeks to sell at least 200 more Gripens abroad, Kemp said.
Norway dealt Saab a blow in November with a contract for 48 Lockheed Martin F-35s and the Netherlands selected the U.S. plane as the best candidate to replace 85 older aircraft a month later. Denmark may make the same choice this year. All three countries are partners on the F-35 program.
Among countries with no participation in the F-35, India is key, Kemp said, with a requirement for at least 126 fighter aircraft and perhaps as many as 300. Saab has proposed a deal in which it would build the first 18 planes and Bangalore-based Hindustan Aeronautics Ltd. would manufacture the rest.
“Our relationship with India is good,” Kemp said. “We want to transfer technology and allow the Indians to get on with it. Basically we would become a subcontractor to HAL.”
To contact the reporter on this story: Sabine Pirone in London at spirone@bloomberg.net
On the 11 June the first single-seat Gripen C destined for the South African Air Force flew for the first time. Flown by Saab test pilot Richard Ljungberg the aircraft took off from Saab's facility at Linköping in Sweden at 13.00 and touched down safely back at Linköping at 14.03 in the afternoon.
The Swedish Chief Prosecutor Christer van der Kwast decided on 16 June to close the preliminary investigation into Saab concerning alleged illegal methods in connection with the sale of Gripen.
Gripen participated in a multinational exercise conducted over northern Sweden between the 8th and 16th June. Air Forces from ten nations participated in the NATO-led operation Loyal Arrow to train methods for quick reaction and the ability to participate in international efforts.
The Annual Report on offset performance for 2008 has been approved by the Czech Ministry of Defence. The report concluded that the Gripen industrial co-operation programme in the Czech Republic generated CZK 4.94 billion in export value for the country.
On 2 June, Saab attended a conference on Swedish- Brazilian Industrial co-operation being held in São Paulo, together with the Brazilian Industry association, FIESP, and the Swedish Trade Council.
Saab is prepared to shift as much as 50 percent of future Gripen production to the South American country, where the main competition to provide 36 warplanes is from Boeing Co.’s F/A-18, Bob Kemp, marketing chief for the $50 million plane, said in an interview. Final assembly work has already been offered to Empresa Brasileira de Aeronautica SA, or Embraer, he said.
Saab is betting on the Brazilian order to rescue the flagship Gripen as the production backlog shrinks. Winning the contract, which may be awarded as early as next month, is crucial to establishing the model as the warplane of choice in markets not already dominated by Boeing and Lockheed Martin Corp., which is grabbing market share with its F-35.
“Maybe in the future Brazil will become the leading exporter of the next-generation Gripen,” Kemp said yesterday by telephone from Linkoeping, Sweden, where Saab is based. “This fits perfectly with their strategic ambitions. We are looking at six or seven major defense companies that have the potential of offering equipment for our aircraft.”
Saab fell 0.9 percent to 57.25 kronor in Stockholm trading. The stock has declined 20 percent this year, giving the company a market value of 6.42 billion kronor ($812 million).
Recommendation
Brazil’s defense ministry said that final bids for the contract were submitted last month from Boeing, Saab and France’s Dassault Aviation SA, which is pitching the Rafale. The air force will make a recommendation to Defense Minister Nelson Jobim in early August, with the final decision in the hands of President Luiz Inacio Lula da Silva.
Saab may be able to fend off Boeing because it can transfer more technology to Brazil than the Chicago-based company, Kemp said, adding that the Gripen costs about 20 percent less than the more-sophisticated F/A-18 and is better matched to Brazil’s need for a low-maintenance fighter able to operate in small numbers from widely dispersed airfields. Spare parts and maintenance may also cost one-third less, he said.
While Brazil’s initial requirement is to replace a batch of aging Mirage jets made by Paris-based Dassault, the country may need as many as 120 planes, Kemp said, each with a life of as many as 40 years.
‘Weak at Home’
“In terms of value for money the Gripen is a superb aircraft, but Saab is at a terrible disadvantage in not having a strong home market,” said Richard Aboulafia, vice president at Teal Group, a Fairfax, Virginia-based consultancy.
While the model has so far won 250 orders, 204 of them are from Sweden, where some planes have been leased out as the government reins in defense spending.
The future of the 1,320 mile-per-hour plane will be determined by purchases in Brazil, India and Switzerland within the next 18 months, Aboulafia said. Saab may need to provide more inducements because it can’t match the offset work that Boeing can offer in fields such as civil aerospace, he said.
Brazil would be granted a full 50-50 partnership on development, production and marketing of the Gripen for export, the executive said, including the manufacture of high-value communications, display and avionics systems.
Saab has so far won only two export contracts for the Gripen, with South Africa buying 26 planes and Thailand taking six. Deliveries will run out in 2012 and output is down to 10 to 12 aircraft a year from about 15 previously, with suppliers including Volvo Aero, maker of the Gripen’s RM12 engine, already winding down production.
Broad Collaboration
Saab’s plan to develop an enhanced “next generation” Gripen means it can offer Brazil collaboration from the design stage on, unlike Boeing and Dassault, Kemp said. The size and status of the Brazilian aerospace industry makes a partnership feasible, he added. Embraer is the world’s fourth-biggest planemaker after Boeing, Airbus SAS and Bombardier Inc.
“I think there’s no question in the minds of Brazilians that Boeing’s product is the best and competitively priced,” Mike Coggins, senior manager for business development at Boeing’s defense unit, said by telephone from St. Louis.
It makes no financial sense to co-produce locally the 36 planes Brazil is seeking, although a larger order in the future may provide the necessary scale, he said. As part of its offsetting technology transfer package, Boeing will allow Brazilian companies to help develop future upgrades, he added.
Export Candidates
Argentina, Ecuador and Mexico represent possible export opportunities within Brazil’s immediate sphere of influence, Saab’s Kemp said, with aircraft replacement orders anticipated within the next five years.
The Gripen upgrade plan may work against Saab because Sweden hasn’t ordered the plane and that will make the model “tough to sell,” according to Teal’s Aboulafia.
Saab’s pitch to Brazil comes as the company focuses its marketing on nonaligned countries that aren’t already major customers for U.S. warplanes as the company seeks to sell at least 200 more Gripens abroad, Kemp said.
Norway dealt Saab a blow in November with a contract for 48 Lockheed Martin F-35s and the Netherlands selected the U.S. plane as the best candidate to replace 85 older aircraft a month later. Denmark may make the same choice this year. All three countries are partners on the F-35 program.
Among countries with no participation in the F-35, India is key, Kemp said, with a requirement for at least 126 fighter aircraft and perhaps as many as 300. Saab has proposed a deal in which it would build the first 18 planes and Bangalore-based Hindustan Aeronautics Ltd. would manufacture the rest.
“Our relationship with India is good,” Kemp said. “We want to transfer technology and allow the Indians to get on with it. Basically we would become a subcontractor to HAL.”
To contact the reporter on this story: Sabine Pirone in London at spirone@bloomberg.net
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