Boeing's F/A-18 E/F Super Hornet, French manufacturer Dassault's Rafale and Swedish company Saab's JAS-39 Gripen NG are in the race to win the contract to supply Brazil with up to 36 jets.
Brazil's air force is operating a mixed fleet of aging aircraft, including the French Mirage, and many of the jets have gone through repeated upgrades and some have been grounded.
All three companies are spending hundreds of thousands of dollars on upgrading and matching Brazil's stated needs, with no indication yet which of them will be given preference.
Brazilian President Dilma Rousseff has been postponing a decision, citing the country's economic slowdown and cutbacks in state funding. At the same time, the government is going ahead with refurbishment of all armed forces, though slower and in stages.
The FX-2 program carries a current price tag of $8 billion but that is certain to change, analysts said.
Defense News said contender Rafale was among manufacturers undertaking software upgrades.
Dassault's F-X2 offer will be the Rafale F3R, which includes a major software upgrade that allows the aircraft to take fuller advantage of the new Thales RBE2-AA AESA radar, improves their Thales SPECTRA self-defense systems, adds Mode-5/Mode-S capable Identification Friend or Foe, and allows the Rafale to deploy MBDA's Meteor long range air-to-air missile, Defense News said on its website.
"Given Brazil's insistence on an AESA radar, Dassault could hardly avoid offering the F3R."
DefenseWorld.net said Rafale is being upgraded to a new standard with major software upgrades and will be known as the Rafale F3R.
Active electronically scanned array, also known as active phased array radar, is a type of phased array radar. The transmitter and receiver functions of the system are composed of numerous small solid-state transmit and receive modules.
Saab, meanwhile, has indicated avionics changes to meet with Brazilian requirements.
Saab executive Eddy de la Motta was quoted as saying a Brazilian version of its JAS-39 Gripen NG would use Israeli subsidiary AEL's avionics, creating a forked version under the wider development effort, Defense News said.
Elbit subsidiary AEL's avionics are already used in Brazilian military aircraft except Brazilian air force Mirage 2000s that are due to retire.
Brazilian aviation major Embraer is likely to be involved with the FX-2 program irrespective of which of the three contenders wins the contract.
Recent reports suggested some Brazilian government officials may be tilting toward support for Boeing over Saab.
AEL Sistemas S.A., a subsidiary of Israel's Elbit Systems, recently announced it will produce avionics for Gripen NG fighter if it is chosen for the FX-2 program.
The avionics package would include displays, processors, computers, software, integration services and logistics support.
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