SAO PAOLO, Brazil, June 3 (UPI) -- Brazil's Valor Economico reported that the government here was considering the would-be supplier of 36 jet fighters to purchase a fleet of cargo jets from Empresa Brasiliera de Aeronautica SA, one of the world's largest aircraft manufacturers.
The report surfaced as Brazil was gearing towards the final stages of its decision to pick the winner of a multibillion-dollar tender to supply its air force with state-of-the-art combat aircraft.
Citing remarks by Defense Minister Nelson Jobin, the newspaper said the purchase of 12 cargo aircraft by Brazil's leading aircraft manufacturer, also known as Embraer, could be a condition of the final contract.
The Sao Paolo newspaper said the defense minister was poised to make the recommendation as Embraer seemed to be struggling with a slide in commercial jet deliveries marked during its first-quarter reviews and attributed to the global slowdown.
The shortfall, however, was "offset numerically by a jump in deliveries of its new Phenom executive jets series -- it delivered 19 business jets last quarter against eight in the year before period," Brailstocks reported.
Since the jet fighter tender was called in 2009, Dassault's fighter Rafale has been competing against Boeing's F-18 and Saab's Gripen NG.
Brazilian President Luiz Inacio Lula da Silva has said the winner would be chosen on political and strategic grounds and not on the mere price tag of the competitors.
The remark has suggested the president is leaning towards the French bid. The country's air force was said to be lobbying for the less expensive Gripen NG, although Jobin did not publicly disclose his preference to Valor.
The American option is being regarded as the underdog because of U.S. refusal in the past to allow Brazil to export aircraft using U.S. technology. Rafale's initial bid has been $8.2 billion for the package, well more than the Gripen offer of $4.5 billion plus $1.5 billion for maintenance. Boeing's bid is valued at $5.7 billion plus $1.9 billion in maintenance.
France is keen to seal the deal with Brazil, making the Latin American country the first export customer of its Rafale, after losing out in several other tenders around the world.
By some accounts, the contract for the initial 36 planes could rise to more than 120.
What makes the French bid attractive, experts say, is France's sweetener of transferring all technology related to the supersonic Rafale so that Brazil, bent on becoming the lead military power in South America, could assemble most of the jets itself and sell them regionally.
Brazil has already signed a deal with the French for the construction of five submarines in Brazil. The deal also includes building a nuclear-powered vessel.
