Saab lowers the price of its Gripen to snatch the market in the Netherlands

16th February 2009 Nicolas Gros Verheyde

(B2) Determined to win the public market for the replacement of Dutch F-16 fighter jets, against its American competitor F-35 Joint Strike Fighter (JSF), the Swedish aircraft manufacturer Saab is slashing prices... It is said to have offered the Netherlands "85 Gripen fighters for 4,8 billion euros" during a visit by parliamentarians from the Defense Committee. That is almost a billion less than the amount set aside by the Ministry of Defense (5,7 billion euros) to replace the F-16s, according to our sources.
colleagues NRC Handelsblad.

Better. The Swedes add a guarantee to their offer: a fixed price for the operation and maintenance of the unit over the next thirty years, of around 10 billion euros (while for the F-35 it goes up to 14,4 billion euros and that is still an estimate). So, too good to be true? The Dutch Ministry of Defense does not hesitate to say it, behind the scenes, emphasizing that "not everything is included" and that the "real amount is much higher". The JSF is cheaper for them than the Gripen (especially since the Dutch have in fact already invested nearly a billion in the F-35 project). They cite in particular the Norwegian example. Last November, Norway, which was in the same dilemma, finally opted for the JSF, having noted that the prices of the Gripen were two to three times higher than what its manufacturer Saab had suggested.

In these times of crisis, the Swedish offer is however attractive, especially since Saab is ready to write down its guarantee in black and white, as having legal value. Saab also made a similar offer of 2,9 billion euros to Denmark for the purchase AND maintenance of 24 aircraft. So… before the 2nd Chamber decides, in April, on the purchase of the first two F-35 test aircraft, the members of the Defense Commission would like to have a precise evaluation of the comparative advantages, and the true cost, of the each other. A new episode in the battle which pits the Swedish aircraft manufacturer against its American competitor.

(NGV)