Bloomberg News

UAE Says Dassault Fighter Bid Uncompetitive, Buoying Eurofighter

November 18, 2011

Nov. 16 (Bloomberg) -- Dassault Aviation SA’s bid to supply the United Arab Emirates with as many as 60 Rafale warplanes is uncompetitive, the Gulf state said, boosting prospects that rivals Eurofighter GmbH or Boeing Co. may secure the order.

While French President Nicolas Sarkozy has made every effort “diplomatically and politically” to win the contract for the Rafale, Dassault’s proposals still come up short, Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed Al Nahyan said today.

“Unfortunately, Dassault doesn’t realize that political will and all the diplomatic efforts cannot overcome uncompetitive and unworkable commercial terms,” Sheikh Mohammed, who is also deputy supreme commander of the U.A.E.’s armed forces, said in a statement issued by state-run news agency WAM.

Losing out on an order that Dassault has been chasing for three years would leave the Paris-based company making just one Rafale a month, with the French military as its sole customer. The U.A.E. asked Britain for data on the rival Typhoon when officials met in Abu Dhabi last month, manufacturer Eurofighter said this week at the Dubai Air Show, while Boeing said today it has pitched two aircraft options for the contract.

The U.A.E.’s requirement is for planes to replace aging Mirage fighters that were made by Dassault, according to an official at Eurofighter, which is owned by BAE Systems Plc, European Aeronautic, Defence & Space Co. and Finmeccanica SpA.

A Dassault spokeswoman didn’t immediately return calls.

Boeing Offer

Boeing has proposed both the F-15 Strike Eagle and F/A-18 Super Hornet for the U.A.E. order and continues to work on the requirement, U.S.-based spokesman Paul Lewis said today. The pitches “went very well,” a local spokesman said.

Eurofighter declined to say how Sheikh Mohammed’s comments might impact order prospects. Lockheed Martin Corp., the world’s biggest defense company, couldn’t immediately say if it had issued proposals, spokesman Tom Casey said by telephone.

“The Rafale has had a decade of close-to-firm orders that somehow never went anywhere,” Richard Aboulafia, vice president of analysis at U.S.-based Teal Group, said before the U.A.E.’s announcement. “A real order would take a lot of pressure off the French budget because keeping that line alive is a major cost.”

Previous requirements that failed to result in orders for the Rafale included tenders in Morocco and Libya. President Sarkozy’s spokesman Franck Louvrier didn’t immediately return calls seeking comment today.

--With assistance from Helene Fouquet in Paris, Sabine Pirone in London. Editor: Chris Jasper.

To contact the reporters on this story: Andrea Rothman in Paris at aerothman@bloomberg.net; Tamara Walid in Dubai at twalid@bloomberg.net

To contact the editors responsible for this story: Benedikt Kammel at bkammel@bloomberg.net; Chad Thomas at cthomas16@bloomberg.net


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