FLUG REVUE October 2002: Fighter marketing is very difficult

FIGHTER ORDERS UNDER POLITICAL PRESSURE

By Volker K. Thomalla

Civil business is extremely important to European aerospace companies. For example, 76% of sales by the French fighter aircraft specialist Dassault Aviation are accounted for by Falcon business jets, compared with only around a quarter coming from military products such as the Mirage or the Rafale. Twelve years ago the ratios were the other way round.

At EADS too, profits are heavily dependent on civil business in the form of Airbus. Managers are therefore extremely keen to promote business in the military sector. But since the terrorist attacks of 11 September, this has not been so simple. At least in Europe, politicians are happy to make grandiose announcements, yet these are only rarely translated into action. This has been particularly evident over the procurement of fighter aircraft.

Modern fighters are the technological flagship of a company. They are a demonstration of the capability of an industry. Once in service with the armed forces, they are more than just a high-tech tool for the purpose of carrying out military tasks: they are also an expression of the modernity and defence capability of a country.

Even so, they are a lot more difficult to sell today than they used to be. Often the requirement is no longer viewed as urgent by the politicians, even though every nation's military planners regard a modern air force as indispensable, not least in the face of the new emphasis on international peace-keeping missions. When, for example, the recent crisis between India and Pakistan threatened to escalate, an American aircraft carrier and the French carrier Charles de Gaulle together established a buffer zone on the sea which prevented the Indians and Pakistanis from sending fighter planes to the other country by sea, as has happened in the past. In this case, peace was secured by the French and American Navy fighters with their modern equipment.

When financial constraints raise their head, purchases of fighter aircraft are always the first area in the budget in which cutbacks are considered. For example, three years ago Norway had every intention of selecting a successor to the F-16 Fighting Falcon and issued requests for tender to the various competing manufacturers. But in the end the tendering process was terminated and Norway announced it would defer its decision until 2008. Then in June 2002 the country joined the American JSF programme, at a cost of 1,016 million Norwegian kroner (Euro 137 million) over a ten-year period. The Norwegian government emphasised that this did not mean it had already decided which fighter it would purchase in 2008. However, it is by no means certain whether they really will make a decision then.

The Czech Republic on the other hand had already selected the technologically sophisticated Saab Gripen for its air force. But then in August the country was hit by the flood of the century, which has also swept away the plans to modernise the air force. The government has cancelled its order, as the natural disaster leaves it no financial leeway for such a purchase.

Austria had selected the Eurofighter to replace its ageing Drakens. But then Austria too was afflicted by severe flooding this summer, resulting in billions of euros of damage. Now voices are being raised in that country demanding that the Eurofighter purchase is either postponed or cancelled because of the flood damage.

There is no doubt at all, equipping armed forces with modern systems is an expensive business. Defence budgets must be adapted to the new tasks. Reorganising the armed forces simply to reflect another round of cutbacks is not the solution. Without modern equipment – including fighter aircraft – the armed forces cannot perform their functions properly. And being forced increasingly to rely on help from outside in case of crisis is a dangerous path.

From page 4 of FLUG REVUE 10/2002

Last updated 12 September 2002

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