Report: Britain, Italy May Slash Eurofighter Orders

[SUBMAN1]

Let me guess, they plan to buy more F-35's instead.

-S



http://www.defensenews.com/story.php?F=3239826&C=europe

Report: Britain, Italy May Slash Eurofighter Orders
AGENCE FRANCE-PRESSE, FRANKFURT

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Britain and Italy are considering cutting orders of the Eurofighter combat jet that both countries helped develop, a press report said Dec. 10.


"These countries have asked for information that indicates a reduction in the number" of orders, the president of the Eurofighter consortium, Aloysius Rauen told the German business daily Handelsblatt.


Partners in the consortium divided work on the plane in 1998, according to the number of aircraft each country planned to buy, with a total of 620 orders booked in three stages through 2017.


The last stage of 236 planes is now subject to "massive haggling," according to Rauen.


Britain reportedly wants to reduce its commitment to buy 88 planes by half, and Italy also wants fewer than the 46 jets it was to buy.


In the 1990s, Germany cut from 250 to 180 the number of Eurofighters it planned to purchase, after receiving 30 percent of the work, compared with 37 percent for Britain, which had only 232 planes on order at the time.


A reduction by Britain and Italy now would reshuffle the amount of work awarded to each member of the consortium, and also lead to compensation payments.


The Eurofighter is a multipurpose combat jet of which 72 copies have also been ordered by Saudi Arabia in a deal worth 20 billion pounds (41 billion dollars).


It was developed by a European consortium composed of the aerospace group EADS, BAE Systems of Britain and the Italian group Alenia/Finmeccanica.

[Rotary Crewman]

Don't buy anymore helicopters or train anymore crews, we have loads and don't require them. Please get some more fighters for the current day tasking and threats :o

[Skybird]

It's about financial compensation payments, money, and job shares. The F35 has little to do with it. It was not much different with the cuts in orders the raptor has seen. The F22 now is bought in numvbers that let critics say they doubt he military use of an aircraft that will be available only in so low quantities. Other critics in Europe already said the same about the Eurofighter, although for eurpope the strategic perpsective is less unsatisfying than it is for the US, since Europe is not so massively militarily engaged around all the globe.

stanislaw Lem once wrote in a satiric essay on the future, that in the late 21st century the mighty US air force will consist of only three planes anymore. More they will not be able to afford. :D and these planes will never been flown - they also cannot afford to loose one of them in an accident. :lol:

[SUBMAN1]

It's about financial compensation payments, money, and job shares. The F35 has little to do with it. It was not much different with the cuts in orders the raptor has seen. The F22 now is bought in numvbers that let critics say they doubt he military use of an aircraft that will be available only in so low quantities. Other critics in Europe already said the same about the Eurofighter, although for eurpope the strategic perpsective is less unsatisfying than it is for the US, since Europe is not so massively militarily engaged around all the globe.

stanislaw Lem once wrote in a satiric essay on the future, that in the late 21st century the mighty US air force will consist of only three planes anymore. More they will not be able to afford. :D and these planes will never been flown - they also cannot afford to loose one of them in an accident. :lol:Raptors have been re-authorized. We are producing many more than what was originally planned at the end of the budget cuts. I think 435 (?) now with options for more. That is a force to be reckoned with. 150 aircraft is too thin.

Let me see if I can find the latest numbers. They keep rising. I wish they would can a few F-35's though in favor of more raptors.

-S

[SUBMAN1]

I'm wrong. They've increased it to about 200 aircraft now. The real number is supposed to be 191. I think we may get more - published on Dec 13th (20 more means 203 units - but we need more):

A Push for More F-22s: Reportedly a determined group of lawmakers are writing to Defense Secretary Robert Gates to press the case for continued production of the new F-22 stealth fighter. Among them are Sen. Saxby Chambliss (R-Ga.), Sen. John Cornyn (R-Tex.), Rep. Kay Granger (R-Tex.), and Rep. Chet Edwards (D-Tex.). Chambliss already has asked (http://dailyreport.afa.org/AFA/Reports/2007/Month11/Day28/1040attention.htm) the Pentagon to release three independent studies that apparently show the Air Force should have more than the 183 Raptors currently approved. The 2008 defense spending bill includes a provision for 20 more (http://dailyreport.afa.org/AFA/Reports/2007/Month11/Day14/1030raptors.htm) fighters but provides no additional money. According to Dave Montgomery of the Fort Worth Star-Telegram, more than 50 lawmakers (http://www.star-telegram.com/news/story/352986.html) have signed the letter and more may join in before the group dispatches the letter this week.

-S

http://dailyreport.afa.org/AFA/Reports/2007/Month11/Day14/1030raptors.htm

PS. The Air Force is pushing for 380 planes.

[Skybird]

The last number of Raptors I heared of and remembered when writing the above was in the range of 180-190. since this is an extremely expensive aircraft, further cuts cannot be ruled out, no matter what kind of government is next.

[SUBMAN1]

The last number of Raptors I heared of and remembered when writing the above was in the range of 180-190. since this is an extremely expensive aircraft, further cuts cannot be ruled out, no matter what kind of government is next.I bet we end up with close to 300. It is how the US Government works. An example is, Seawolf - They were supposed to cancel the entire project, yet the Navy still built 3 of them.

There will be no more cuts on F-22. The money has been appropriated already, and we already have over 100 of them. It is easy to cut things when the money is not there yet. After it is there, to get lawmakers to bend to a cut is a rarity.

-S

PS. The aircraft is not expensive. It is similar to 1970's dollars to build the F-15. As time went on, the F-15 got less expensive to produce, and so will Raptor. An example - if in 1977, an F-15 costs $20 Million, if you were to buy that same aircraft 30 years later in 2007 (assuming production costs never came down), it would cost you $160 Million today. This is actually more than a Raptor costs.

[Skybird]

Raptor: year, current number of total planes ordered, costs per piece:

1990 - 750 - 149 Mio
1993 - 442 - 162 Mio
1997 - 339 - 187 Mio
2003 - 279 - 257 Mio
2005 - 178 - 345 Mio

these numbers are production costs, inclduing - in shares - costs for developement and research. Your lower numbers assume that the raptor fell down from the sky and was just to be copied, saving a lot of money that way.

these costs are so high that the Raptor hardly will become a great export success, in fact it laready has lost several competitions, namely in the Guld and SE Asia region. Since it's specifications are in parts surpassed by the Eurofighter, and since it's shining features like supercruise and stealth only can be realised with minimum and internal payload, this is again a reason why the Raptor will not become much cheaper by raising production numbers. It's a good design, but it will not become a commercial success. It is often said that the kill ratio between the eurofighter and the Raptor statistically is expected to be around roughly 1:4, making the eurofighter the closest rival to the Raptor in this statistical war, but that means that by production costs, four shot down eurofighter equals the costs of 1 shot down Raptor. If considering risks of accidents causing losses (financially), and slow numbers available for military operations, and having less diversity in military combat profiles it can conductcompared to the eurofighter, the Raptor militarily makes less sense for a global power, than the eurofighter does, which for the same money could be produced in four times as high numbers, has more capabilities, and thus could be made available by the US in sufficient numbers around the globe. Seen that way, the whole thing is a bit queer: because Europe has more use for the Raptor to secure the limited local area of Eurpopean airspace with a limited number of airplanes, while America has more use for the Eurofighter with it's much higher quantities and wider combat role possebilities.

tighten your seat-belts before starting to follow the cost spiral for the F-35. It will see the same way upwards like Raptor and Eurofighter. In the end it will cost 2.5 times as much as originally planned - minimum.

[SUBMAN1]

Raptor: year, current number of total planes ordered, costs per piece:

1990 - 750 - 149 Mio
1993 - 442 - 162 Mio
1997 - 339 - 187 Mio
2003 - 279 - 257 Mio
2005 - 178 - 345 Mio
I think your costs are wrong. The F-22 has been streamlined and is now down to $135 million a copy last I checked. I think you are including development costs in there. That bill has already been paid, so it is a mute point at this point in time. That is artificially increasing your unit costs.

-S

[Skybird]

What have I said? ;)

Again, other source:

Because development costs have risen and the number of aircraft dropped, the F-22 now ticks in with a per plane cost of $345 million, according to a March Government Accountability Office report.

that was decembre 2005:
http://www.air-attack.com/news/news_article/876/F-22-Production-May-Be-Slowed.html

Of course costs per piece, and selling cost, reflect developement, and try to compansate for these starting investements. Else the producing company would run bancrupt when selling the toys.


Also:
Washington (UPI) Jul 26, 2006
The U.S. Air Force's plan to buy up to 60 more F-22 fighter jets will cost $1.7 billion, the Government Accountability Office said.

The Air Force argues that the scheme will cut $3.7 million off the price of each of the aircraft -- saving a possible $225 million -- and that it is necessary to keep advanced U.S. fighter manufacturing lines active while the Joint Strike Fighter comes on line. Shutting down production lines can scatter experienced workers and often incurs the cost of warehousing manufacturing components. The F-22 production line was supposed to go cold at the end of 2007, but the USAF sought and won congressional approval to stretch it out until 2010 via an amendment to the defense authorization bill.
http://www.spacewar.com/reports/USAF_Adds_Billions_To_F_22_Raptor_Costs_999.html

[Skybird]

It is possible that we both are right here. Interesting article:

http://www.strategypage.com/htmw/htmurph/articles/20060809.aspx

Which price is cited often depends on what the person citing it wants. Critics of the F-22 will cite the $361 million price tag, and compare it to the F-35's. Proponents will cite the "fly-away" cost of $117 million ? and point out that the R&D is already paid for. They also have exercise evidence to point to. The "fly away" price of $117-137 million will also make the F-22 far more competitive to potential export clients like Australia (which is worried about delays to the F-35) and Japan (whose F-15Js may need replacement soon).

So, who tells the truth about how much an F-22 costs? How can you reconcile the nearly $250 million per plane difference between the low-end estimate and the high-end estimate? Simple, just remember that commercial firms have the same accounting situation. It costs billions of dollars to develop new commercial aircraft, and those costs must be paid for. They are, by including the development costs in the price paid for the aircraft. But the Pentagon does not "buy" warplanes the same way airlines pay for airliners. The Pentagon pays for development, then it pays for production. Airliners pay for both when they buy their aircraft. If you want the real cost of a warplane, you have to include a portion of the development cost to the production cost.

You only mention the actual fly-away-price, while I include a share of the dvelopement costs, which is constantly changing the more planes get build. For example, the Eurofighter has a fly-away-price of 63 Mio. But most customers will pay 80-90 Mio, actually. Germany pays 75 and 85 Mio, Saudi Arabia even 92 Mio for used British Eurofighters.

[SUBMAN1]

You only mention the actual fly-away-price, while I include a share of the dvelopement costs, which is constantly changing the more planes get build. For example, the Eurofighter has a fly-away-price of 63 Mio. But most customers will pay 80-90 Mio, actually. Germany pays 75 and 85 Mio, Saudi Arabia even 92 Mio for used British Eurofighters.That is for critics of projects to put in peoples faces.

Right now, if you want 1 or 10 more F-22's, to the United States of America, it costs about $135 million. The costs will only go down. The development cost has already been paid - it is a done deal and has no more bearing on future procurement. That is the difference. So as a total overall program, yes, your costs are factored in.

So to set things straight - For future F-22 procurement - it is now simply a matter of paying an additional $135 million or less per aircraft. It is not a $300 million bill, it is a $135 million bill.

Way to confuse people Skybird.

-S

[Skybird]

Again:

So, who tells the truth about how much an F-22 costs? How can you reconcile the nearly $250 million per plane difference between the low-end estimate and the high-end estimate? Simple, just remember that commercial firms have the same accounting situation. It costs billions of dollars to develop new commercial aircraft, and those costs must be paid for. They are, by including the development costs in the price paid for the aircraft. But the Pentagon does not "buy" warplanes the same way airlines pay for airliners. The Pentagon pays for development, then it pays for production. Airliners pay for both when they buy their aircraft. If you want the real cost of a warplane, you have to include a portion of the development cost to the production cost.

Can't be much clearer on it than this guy is telling it.

[SUBMAN1]

If you want the real cost of a warplane, you have to include a portion of the development cost to the production cost.
Can't be much clearer on it than this guy is telling it.

That is a project cost! That bill has been paid. If we add more planes, doesn't matter how many at this point, the price is the $135 Million. If we buy 1000 more, it is still $135 million. The developement is no longer being paid. What is it that you don't get about that? This is not rocket science.

Gee - I can't figure out that I don't have to pay the portion that has already been paid! Is that what you are saying? :D I think you are smarter than that.

-S

[Skybird]

What is that you don't get? :D The developement costs have been poayed by whom...? Heaven? Future generations? The man in the moon? No, they got payed by taxes. And that is real money. when selling the plane in the future, that payment is not nullified. It remains to have been a real transaction. You do not realise that you reason it out of the formula, as if the current fly-away-price is unlinked to that early investements. Boy, now don't make it more difficult then it is! why do you think they make a difference between so-called fly-away-price, program price, and system price? Fly-away price is the cost of a single unit at a given time, without support, logistic, future investement, additonal packages. System price includes all that, exclduing developement costs. Program price means all costs included, including developement. It is not wrong that you want to mention fyl-away-prices only, but you hide by that that there is a program price nevertheless. And if it is a foreign customer whose taxes were not used during developement, it simply means that you accept to sell hiom the item far below it's real value, and nthat American tax payers already had to compensate for that. That is what is called a self-subventing system.

really, we have these price spans concenring the eurofighter as well, fly away-price versus prograsm price, and I talked about it with people who really know that kind of stuff a bit. In the main I just repeat what I have learned from them, becasue it sounded perfectly reasonably to me.

the real value of an item is not the fly-awqay-price, but is calcuated by the program price, or project price as you call it. that's why the vlaue of an F-22 is much higher than the 135 Mio you have given. Only if oyu would have just copied it from somebody else, and did not had to spend any money into design, research and developement yourfself, your view would be correct. that is, in principßal, the situation for the foreign customer as long as he does not get added a share of develoepemnt costs to the fly-away price, or better: system price, since planes do get sold in service packages, not just the plane and that's it.

Yes, I know, you still disagree and think I have lost my mind. Well, so be it. But there is no reason in repeating myself again. So, file closed over here.

[SUBMAN1]

That is a seperate topic. This is like saying that I paid GM to design a car for me and then they tooled up and built the car. From that point on, no matter how many cars I buy, regardless of my development cycle, I pay the same to have as many as I want from then on assuming no streamlining the production.

That is what i am saying. The American tax payer has already paid the development bill. That is done and over with, regardless of how many F-22's are produced.

What you are saying is, that F-22 is going to cost an additional $300 Million if we only buy one more. This is how you are writing it. It doesn't!

-S

[Skybird]

What you are saying is, that F-22 is going to cost an additional $300 Million if we only buy one more. This is how you are writing it. It doesn't!

-S
No, that is not what I am saying, but - however. :damn: :lol:

[SUBMAN1]

What you are saying is, that F-22 is going to cost an additional $300 Million if we only buy one more. This is how you are writing it. It doesn't!

-S No, that is not what I am saying, but - however. :damn: :lol:Maybe this is a translation error? That is how I read what you wrote. Sorry if I misread something.

-S

[Skybird]

Value of the flying unit:

( [ (production cost for one unit + profit range) x number of total orders] + project developement costs ) / number of total units.

You see, the value of the unit is varying, depending on how many units get produced. The investement has exlcusively been done by the american taxpayer. It is history, but that does not matter: even if the production akes polace in three phases, and each phase sees lower prices per unit, it nevertheless remains to stay in the formula. If the company does not wish to cash in the increasing profit per unit (resulting from that the developement costs get divided by the more unit numkbers, the more units get produced), then it will keep the profit constant, which allow it to lower the price, the more additonal units get produced. This price shift is taking place in steps, since the product get's produced in phases (orders for a set of a given number of aircraft, not one-by-one).

Different for the customer from overseas. For him, the formula loos like this:

[ (production cost for one unit + profit range) x number of total orders] / number of total units.

what remains from that formula:

(production cost for one unit + profit range) x number of total orders

He will not be charged to add a bonus for the developement to the price, as long as the price remaisn to be the same as for the american customer.

you see it now? Your price is more according to the second formula. You think that money that has been spend on development - has not been payed at all. That'S why you only see the current fly away price. Me and "citics of the F22 program" :) see that the ready product did not fall in a finished state inbto the catalogue, but had to be designed, and that design costed money - american tax money. and this tax money needs to be reflected to calculate the costs of the flying units.

You make a time step that does not make sense. Because after all you still have payed for the developement. If you still don't get it, have some sleep and try again tomorrow. It is not difficult, really! ;)

:rotfl: