Saab bags $4.5-bn Brazil jet deal
19 Dec 2013
Swedish aerospace manufacturer Saab has beaten Boeing and Dassault Aviation, acquiring the $4.5-billion (£2.7 billion) contract to supply 36 fighter jets to Brazil.
The Brazilian government said the contract, known as the FX-2 Programme, was for 36 jets and would be paid over 10 years. Many had expected Boeing or Dassault to emerge as the winner.
According to industry analysts, the news of US spying on Brazilians helped derail Boeing's chances for the deal.
Brazil defence minister Celso Amorim, however, said the authorities, ''took into account performance, the effective transfer of technology and costs - not just of acquisition but of maintenance'' while finalising the supplier.
The agreement is expected to generate billions of additional dollars in future supply and service contracts, apart from the cost of the jets themselves.
According to some sources, the Americans were thrown out of the bid due to the National Security Agency (NSA) problem. The revelations of spying by the NSA in Brazil, including the alleged interception of emails and messages of Brazilian President Dilma Rousseff, her aides and state oil company, Petrobras, led Brazil to believe it could not trust a US company.
The spying allegations were made by Rio-based journalist Glenn Greenwald, who obtained secret files from former NSA contractor Edward Snowden.
According to analysts, Snowden offered to help Brazil's senate with an inquiry into the spying revelations, but indicated he would need permanent asylum to be able to do so.
Meanwhile, Ms Rousseff has denied the rumour saying Brazil has not received any such official request from Snowden for asylum.
As per the terms of the agreement, the contract details between Saab and Brazil will be finalised in a year. First delivery is expected two years later with around 12 aircrafts expected annually henceforth.
Sweden's defence minister, Karin Enstrom, said in an interview that the contract, ''is a sign that the Gripen is a well-functioning system which is cost efficient.''
The Gripen, which would substitute Brazil's present generation of Mirage 2000 fighters, was necessary to protect the country's vast territories, from the Amazon rainforest to its deepwater oil discoveries, known as the ''pre-salt'', Brazilian president Ms. Rousseff said.
At the briefing, the government officials said Brazilian aircraft maker Embraer SA would be Saab's principal partner. The transfer of technology is crucial to help Brazil develop future generations of fighter aircraft.
Sweden on Wednesday ordered 60 new Gripen E fighters, allowing Saab to begin production of the latest generation of a fighter jet that first flew for Sweden's Air Force in the late 1990s.
Meanwhile, Switzerland has also indicated that it too wants to buy the Gripen E. Gripen is also used by South Africa, Sweden, the Czech Republic, Hungary, Thailand and, as a test pilot training aircraft, in Britain.
