Brazil "very likely" to choose French fighter jet: sources

Reuters ^ | Feb 12, 2012 | Brian Winter

[sukhoi-30mki]

Brazil "very likely" to choose French fighter jet: sources

SAO PAULO (Reuters) - Brazil is "very likely" to choose France's Rafale fighter jet to refurbish its air force, government sources say, a decision that would award one of the emerging-market world's most coveted defense contracts to a jet whose future was in doubt only two weeks ago.

President Dilma Rousseff and her top advisers believe that Dassault Aviation's (AVMD.PA) bid to sell at least 36 Rafales offers the best terms among the three finalists, the sources told Reuters on condition of anonymity.

The other two bidders are Boeing's (BA.N) F-18 and Saab's (SAABb.ST) Gripen.

Rousseff has cast the deal as a watershed decision that will help mold Brazil's military and strategic alliances for the next few decades as it continues to establish itself as a leading economic power. The contract will have an initial value of about $4 billion but will likely be worth considerably more over time once maintenance and follow-on orders are included.

Rousseff previously had concerns about the Rafale because the jet had not found any buyers outside France. That raised doubts about whether Dassault would have the scale necessary to build the jets at a reasonable cost and maintain them over time.

The sources said those concerns were assuaged when India announced on January 31 that it had entered exclusive talks to buy 126 Rafales. Brazilian Defense Minister Celso Amorim traveled to New Delhi last week to discuss the deal with Indian officials and examine documents related to Dassault's bid.

"The India deal changed everything," one of the Brazilian sources said. "With India's decision, it's now very likely the Rafale will be the winner here."

The sources said that Dassault offered the best combination of a high-quality aircraft and the sharing of proprietary technology

[sukhoi-30mki]

It is relatively uncomplicated to source core systems (engines, navigation, avionics) for biz-jets but getting them to develop and export a fighter is not the same. More so since Brazil’s force levels for such aircraft are lower than the likes of Taiwan, Japan or India who have undertaken similar projects.

They did develop a neat light attack aircraft called the AMX. The Venezuelans had placed an order for an upgraded variant which was blocked because of the presence of US systems!!