Will latest F-35 problems push Norway towards a European solution?

[Scorpion82]

And what is included in Saabs offer? That is left open, yet LM claims they are cheaper. BTW how do they come to 264 Gripen and since when is India a customer of it?

 

[Vivendi]

We're down to 83.5 mn usd UPC a pop... maybe even further down if those 5-10% are realisable. My translation.


The fighter competition intensifies

Three manufacturers are now competing on who will provide 48 new fighters to the Danish defence. A last minute offer from Boeing has caused Lockheed Martin, who is behind the Joint Strike Fighter, to reduce their price tag.

Christian Brøndum
Wednesday, 27. august 2008 22:30

As the decision to buy new fighters to replace the F16 is closing in, the competition about who will get the contract worth billions intensifies. The U.S. aircraft and missile manufacturer Lockheed Martin has just informed the Danish defence that the price of 48 new fighter, the Joint Strike Fighter (JSF), is now down to less than 20 billion Danish kroner [4.0 bn USD, GD] in "flying" condition, including spares package and two years of pilot training.

The price tag on Swedish Saabs offer of 48 Gripen NG is 22 billion kroner.


http://www.berlingske.dk/article/20080827/danmark/708270050/

The Norwegian quotations:

48 F-35: "less than 20 billon NOK", one newspaper reported 17.5 Billion NOK. The LM offer however did not include equipment and maintainance, that would add another 12.5 billion NOK, to a total of 30 billion NOK for 48 planes.

48 Gripen: 23 Billion NOK, including service, spares, training, simulators.


http://e24.no/makro-og-politikk/article2399300.ece

The Norwegian krona is weaker than the Danish, 23 billion NOK today is approx. 22 billion Danish Kroner so the Saab offers look comparable in Norway and Denmark.



V

 

[Scorpion82]

Just another thought, how can LM offer such prices, if they say at the same time that they can not guarantee such prices, except for a collective order from all the customers. Confirm the schedules and order at least 370 aircraft and you will get a firm price...

 

[Grand Danois]

Just another thought, how can LM offer such prices, if they say at the same time that they can not guarantee such prices, except for a collective order from all the customers. Confirm the schedules and order at least 370 aircraft and you will get a firm price...

I guess you'll have to ask LM.

They claim that a collective order could give a discount of 5-10% of the currently estimated cost.

To your prev: All of us who post here knows that the Gripen NG offer from Saab include 18 years of spares and support, which the LM offer does not, so no the LM offer is not cheaper per unit. The offer is though. Looks like a bit of LM spin. OTOH Saab has claimed that Gripen NG LCC is half that of the F-35. Tit for tat.

 

[Sintra]

I guess you'll have to ask LM.

They claim that a collective order could give a discount of 5-10% of the currently estimated cost.

To your prev: All of us who post here knows that the Gripen NG offer from Saab include 18 years of spares and support, which the LM offer does not, so no the LM offer is not cheaper per unit. The offer is though. Looks like a bit of LM spin. OTOH Saab has claimed that Gripen NG LCC is half that of the F-35. Tit for tat.

Grand Danois

Coming back to a old discussion (and a dam good one).
Did you noticed that this "UPC", just HIT the "Fly Away Cost" mentioned in the 2009 USAF Budget (for the entire 1763 fleet)?

Cheers

 

[Grand Danois]

Grand Danois

Coming back to a old discussion (and a dam good one).
Did you noticed that this "UPC", just HIT the "Fly Away Cost" mentioned in the 2009 USAF Budget (for the entire 1763 fleet)?

Cheers

Did you notice that the fly-away-cost in the 2009 usaf budget is in TY2034 dollars?

Which makes any comparison to a 2008 UPC completely irrelevant.

Cheers

 

[energo]

Just another thought, how can LM offer such prices, if they say at the same time that they can not guarantee such prices, except for a collective order from all the customers. Confirm the schedules and order at least 370 aircraft and you will get a firm price...

I can not speak for the danish LM offer, but the norwegian bid was a fixed price with some usual reservations for unforseen occurrencees like cost of labor, raw materials, inflation etc.

Regrads,
B. Bolsøy
Oslo

 

[Sintra]

Did you notice that the fly-away-cost in the 2009 usaf budget is in TY2034 dollars?

Which makes any comparison to a 2008 UPC completely irrelevant.

Cheers

And did you saw the inflation rates that were used for calculate those "2034 dollars"?
I did... "Small" his an understatement, more like "non existant".
Wich by the way makes this comparison quite RELEVANT.

Cheers

 

[Grand Danois]

And did you saw the inflation rates that were used for calculate those "2034 dollars"?
I did... "Small" his an understatement, more like "non existant".
Wich by the way makes this comparison quite RELEVANT.

Cheers

Nope, because that is how the USAF account internally which, btw has been explained to you across several fora, is not representative in any way of what the partner cost is.

But please elaborate on how 2008 partner UPC compares with USAF TY2034 cost.

Cheers

 

[ASFC]

Lockheed Martin's next move will be, according to Tom Burbage, an offer to the nine partner countries, including Denmark, to buy their total of 370 aircraft at a joint five-year contract in the style of the single European purchase of F-16 in the late 1970s. If we manage to knit a bid together, the nine countries could save five to ten percent due to joint procurement.

If he manages to get the numbers right for the number of aircraft the 9 partner countries are buying correct then I might believe him that he can get another 10% discount. With at least four of the partners buying 100 or over 100, and another looking at getting close to over 90 F-35, 370 does not stack up as the total!:unknown

BTW how do they come to 264 Gripen

By confusing himself on how Hungary and the Czech Republic came by their aircraft-only 236 Gripen have been ordered as of August 2008. (If the Thai aircraft aren't new build then it is only 230.)

 

[Grand Danois]

If he manages to get the numbers right for the number of aircraft the 9 partner countries are buying correct then I might believe him that he can get another 10% discount. With at least four of the partners buying 100 or over 100, and another looking at getting close to over 90 F-35, 370 does not stack up as the total!:unknown

I haven't done the tally, but I think he is only reffering to the F-35As.

UK is buying 138 Bs and Italy is also going to buy some Bs.

That would take it above 500 total.

I don't know how real that 5-10% discount is, but it does point towards costs going down rather than up.

 

[Sintra]

Nope, because that is how the USAF account internally which, btw has been explained to you across several fora, is not representative in any way of what the partner cost is.

Several Fora?!

Well, the only one who contradicted me in any fora about the discrepancies between the "USAF Costs" and the "Partner Cost" was you, in here. With a valid argument, that the "Non recurring costs" were being covered by the USA and GB, and this should be discounted from the "partner Cost" but, has i pointed out then, the "Memory of Understanding" Contract his public and it states quite clearly that those "NRCosts" are to shared by the partners on a "percentage of units bought", specifically Chapter 5 and Chapter 19 clearly mentions that...
Until now i havent seen one single evidence that the "partner costs" wont be identical to what the Pentagon is paying (or i didnt understand it).

Chapter 5 (page 35 and 36)
http://img178.imageshack.us/img178/2070/moujn4.jpg
http://img413.imageshack.us/img413/8541/mou2ek2.jpg

The MOU
http://www.jsf.mil/downloads/documents/JSF PSFD MOU - 07 Feb 07.pdf

But´i am quite happy to be proven wrong, those documents are massive and if someone brings new perspectives or new information, so much for the better.

But please elaborate on how 2008 partner UPC compares with USAF TY2034 cost.

Cheers

I deserved this one...
I wasnt being very explicit, was i?

I´m trying to get a clear view of what a "normal basic FMS" deal ("Fly Away"+3% for the FMS+ 3 years of training and logistic suport) for this jet for the very same timeframe (first delivery 2016/2018) would be.
And these 20 Billion Nok seems to be quite close (throw in the 3% for the FMS and a bit more for logistics/training "et voila"), but the "UPC" is so dam close to that "Fly Away"... Call me naive, but i have this nagging feeling that someone at LM headquarters just picked the "Fly Away" multiplied by 48 and "here you go, it´s just an RFI"...
Would this number be the same if Denmark had launched an "RFP" for a "fixed cost contract" with clear penalties for late deliveries?

Well, the FMS Congress notification for Israel should throw a bit of light in this quest of mine.

Cheers

 

[Grand Danois]

Sintra,

Partners are not subject to FMS, hence no 3.75%. Correct this first. then I will get back.

 

[Sintra]

Yes i know, i even mentioned that

And these 20 Billion Nok seems to be quite close (throw in the 3% for the FMS and a bit more for logistics/training "et voila")

OH, I see, this "FMS" deal of mine is for someone outside of the original partners (Portugal).

Pick the Danish Offer+ the FMS cost + a bit more for logistics and cost = Typical "FMS" acquisition cost.

 

[Grand Danois]

Yes i know, i even mentioned that

I didn't correct your erroneous 3% number to 3.75%. I pointed out that partners do not pay the FMS fee.

To your other question: read section 5.1 of the PFSD MoU, which you were so kind to post, and you have the reply to your second question.

Well, the only one who contradicted me in any fora about the discrepancies between the "USAF Costs" and the "Partner Cost" was you, in here. With a valid argument, that the "Non recurring costs" were being covered by the USA and GB, and this should be discounted from the "partner Cost" but, has i pointed out then, the "Memory of Understanding" Contract his public and it states quite clearly that those "NRCosts" are to shared by the partners on a "percentage of units bought", specifically Chapter 5 and Chapter 19 clearly mentions that...
Until now i havent seen one single evidence that the "partner costs" wont be identical to what the Pentagon is paying (or i didnt understand it).

Chapter 5 (page 35 and 36)
http://img178.imageshack.us/img178/2070/moujn4.jpg
http://img413.imageshack.us/img413/8541/mou2ek2.jpg

The MOU
http://www.jsf.mil/downloads/documents/JSF PSFD MOU - 07 Feb 07.pdf

But´i am quite happy to be proven wrong, those documents are massive and if someone brings new perspectives or new information, so much for the better.

Actually if you read the entire chapter, you'll realise that partner contributions are capped, have a ceiling. So, yes, you were wrong.

 

[Sintra]

I didn't correct your erroneous 3% number to 3.75%. I pointed out that partners do not pay the FMS fee.

To your other question: read section 5.1 of the PFSD MoU, which you were so kind to post, and you have the reply to your second question.



Actually if you read the entire chapter, you'll realise that partner contributions are capped, have a ceiling. So, yes, you were wrong.

The "yes i know" was refering to the fact that the partner nations do not pay the FMS fee, and not the "3%", and yes you are correct on the "3,75%".

And the fact that the partner contributions are capped doesnt mean nothing for this discussion, by this MOU the USA will pay 16843 million US$ for 2413 fighters and Denmark 330 million US$ for 48, (table 5-1, page 34) wich by the way gives almost identical values by unit, slightly less than 7 million US$ by fighter. So... I´m probably right.
Denmark will have to pay its share of "Non Recurring Costs" and untill now that USAF Budget it´s probably the very best document about the F-35A program and unit costs.
In the end i think we are going to agree on disagreeing (this in Portuguese sounds a lot better!).

Cheers

 

[Grand Danois]

The "yes i know" was refering to the fact that the partner nations do not pay the FMS fee, and not the "3%", and yes you are correct on the "3,75%".

And the fact that the partner contributions are capped doesnt mean nothing for this discussion, by this MOU the USA will pay 16843 million US$ for 2413 fighters and Denmark 330 million US$ for 48, (table 5-1, page 34) wich by the way gives almost identical values by unit, slightly less than 7 million US$ by fighter. So... I´m probably right.
Denmark will have to pay its share of "Non Recurring Costs" and untill now that USAF Budget it´s probably the very best document about the F-35A program and unit costs.
In the end i think we are going to agree on disagreeing (this in Portuguese sounds a lot better!).

Cheers

Remember it's TY USD.

And remember the costs paid for by the yanks which are not covered in this doc.

If you think 3-4 mn USD (2008)/6.8 mn USD TY2034 account for the NRC, then please do so.

 

[Grand Danois]

Alright Sintra, here is a more elaborate explanation. The Document you found:

http://www.jsf.mil/downloads/documents/JSF PSFD MOU - 07 Feb 07.pdf

is the PSFD MoU or Production, Sustainment, and Follow-on development.

The NRC accounted for in this document cover:

the total shared NRC production cost is 7.303 bn TY USD (sec 5.2.1). This number should be added to the given UPC per unit.

-//- sustainment cost of 1.323 bn TY USD (sec 5.2.2). This should partially be added to the UPC per unit.

and

-//- follow-on development costs of 13.250 bn TY USD (sec 5.2.3). The participant is only bound to this until the end of the participant production run, i.e. most of it shouldn't be included in a hypothetical UPC.

These cost are capped, much of the NRC has been sunk in the RD&T phase. And it does not include SDD. Note how the term shared is used - there is a part that is not shared.

 

[simdude97]

Did you notice that the fly-away-cost in the 2009 usaf budget is in TY2034 dollars?

Which makes any comparison to a 2008 UPC completely irrelevant.

Cheers

I am curious. Where is it said that it is 2034 dollars? I searched both the 2008 and 2009 budget estimates and found no reference to 2034.
http://www.saffm.hq.af.mil/shared/media/document/AFD-070212-004.pdf
http://www.saffm.hq.af.mil/shared/media/document/AFD-080204-081.pdf

Could you please provide a link that references the fly away cost in 2034 dollars.

Thanks.

 

[Grand Danois]

I am curious. Where is it said that it is 2034 dollars? I searched both the 2008 and 2009 budget estimates and found no reference to 2034.
http://www.saffm.hq.af.mil/shared/media/document/AFD-070212-004.pdf
http://www.saffm.hq.af.mil/shared/media/document/AFD-080204-081.pdf

Could you please provide a link that references the fly away cost in 2034 dollars.

Thanks.

It's in '34 dollars because that's when the project ends.

Thanks!