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Saudis to revive Typhoon deal with BAE

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Published: Feb. 18, 2011 at 10:43 AM
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LONDON, Feb. 18 (UPI) -- British defense manufacturer BAE disclosed that Saudi Arabia may modify its Salam program purchase of the Eurofighter Typhoon to, instead, equip part of the fleet with Tranche 3 capabilities.

BAE suggested the contractual shift in an annual results report, released this week.

The deal is estimated at more than $500 million.

Saudi Arabia took delivery of the first 18 of 72 Typhoon jets over the summer. The deal calls for training of Saudi pilots and technicians in the United Kingdom.

In addition, Riyadh has received 12 single-seat fighters and six two-seat trainers, with 10 of the total having been delivered during 2010, the Flightglobal Web site reported.

"Whilst deliveries on the Salam program remain on schedule, the program is likely to be adjusted to accommodate some customer changes," Flightglobal reported, citing BAE. "These may include relocating final assembly of the last 48 of the 72 aircraft, the creation of a maintenance and upgrade facility in the kingdom of Saudi Arabia and, in addition, the last 24 of the 72 aircraft might be delivered with modifications to allow future incorporation of Tranche 3 capability."

The aircraft in question were originally destined for the British air force but were delivered to the Saudis to meet tight deadlines set by Saudi Arabia in line with the 2007 Typhoon contract.

Since then, Saudi Arabia has been mulling the option of pushing back the order to a later date. Analysts have cited the possibility of the deal being scrapped or trimmed by Riyadh after its large purchase of Boeing F-15s and ambitious designs to upgrade existing F-15s in the country's fleet.

A previous deal by BAE in 2006 to sell jets and other military hardware to Saudi Arabia collapsed following a probe ordered into details of the British-led deal.

"Germany, Italy, Spain and the U.K. have already signed up for Tranche 3A production of the Typhoon, with new capabilities to potentially include the incorporation of MBDA's Meteor beyond visual-range air-to-air-missile, Storm Shadow cruise missile and an active electronically scanned array radar by 2015," Flightglobal reported. Endorsed in 2009, the combined commitment totals $12.2 billion.

BAE has long worked with Saudi Arabia, holding maintenance and upgrade capability facilities in the Gulf state to support the country's fleet of Tornado strike aircraft acquired by the air force.

In its annual report, the defense contractor showed its orders had fallen from more than $50 billion in 2009 to just more than $40 billion in 2010. Earnings advanced to more than $2.5 billion.

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