Rafale Wins One As India Accepts Dassault’s Bid for MMRCA

by: Matthew Potter
February 1, 2012

Category: Boeing, Business Line, Companies, Contract Awards, Countries, D'Assault, Events, France, India, Lockheed Martin, MiG, Military Aviation, production program, SAAB | RSS 2.0

The long running sage of India’s new fighter contract took a major step closer to completion yesterday as the Indian government announced that Dassault Rafale will be considered for the South East Asian country’s Medium Multi-Role Combat Aircraft (MMRCA) contract. In November there had been a decision to start the process to select the final winner of the contract with the choice between the Rafale and the Eurofighter Typhoon.

The MMRCA started over two years ago and companies from across the globe submitted bids. The original proposals came from America’s Lockheed Martin (LMT) and Boeing (BA) along with the two Western European contractors as well as Sweden’s SAAB and Russia’s MiG. A series of trails and evaluations were conducted along with analysis of the proposals and the decision was made in November to eliminate all but Dassault and Eurofighter.

The contract for 126 advanced fighters could be worth well over $10 billion including the cost of support, spares and engineering.

The next few months will see the Indian government negotiating the final terms of the contract including the key provision of offsets. Dassault is proposing to transfer the production capability for the aircraft to India with over 100 of the aircraft being at least partially manufactured and assembled there.

Previously India had relied primarily on British and Russian equipment while trying to invest in an indigenous arms capability. Recently they have realized that in order to gain access to more advanced technology they would need to buy U.S. and European weapons from less traditional suppliers. These have included transports and patrol aircraft from Boeing and Lockheed Martin as well as exploring helicopter and artillery buys from Western Europe.

India has always demanded strict offsets and investment in their economy and have had to adjust these rules to allow companies like Boeing and others from the U.S. to bid. Even so it is good business for a winning bidder to be able to set up production facilities in India as it allows access to that growing market.

The win is significant for Dassault which has struggled to find a buyer beyond the French military and faced issues with keeping their employees busy and revenues up. The Indian contract will aid in both.

Photo from Ronnie Macdonald’s flickr photostream.

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