Bloomberg News

Saab Lifts Gripen Combat Jet Market Outlook on Emerging Markets

September 16, 2013

Saab AB (SAABB) said sales prospects for its Gripen combat jet have improved as the Swedish defense company develops an upgraded model of the plane it already plans to sell domestically and to Switzerland.

Saab predicts increased interest for the plane in regions including Asia, where Thailand already operates a version of the jet, Europe, South America and sub-Saharan Africa.

The Swedish and Swiss governments are cooperating on development of a larger, more capable version of the single-engine jet, called the Gripen E. The Swiss parliament’s lower house voted in favor of buying 22 Gripens last week.

“Saab now pictures the potential for future business with Gripen E more positive over the coming 15-20 years,” the Stockholm-based company said in a statement today.

Saab previously estimated Gripen sales of around 300 units in the next 15 to 20 years. The company left its near-term financial outlook unchanged.

“The business opportunities seem to be quite promising,” Saab Chief Executive Officer Hakan Buskhe said in the statement. “The rising interest for Gripen reflects the long-term analysis of the market for Gripen E as the most cost-efficient and modern state of the art multirole fighter jet system.”

Saab has offered the Gripen to Brazil, which also is considering the Boeing Co. (BA:US) F/A-18 Super Hornet and Dassault Aviation SA (AM) Rafale fighters. The company said previously it sees prospect for further sales in Thailand, and order potential from countries such as Finland and Denmark.

Buskhe also is promoting a concept that would allow militaries to operate the fighter without a pilot.

The Czech Republic last week announced plans to extend a lease of older Gripen jets by 14 years.

Saab shares advanced as much as 1.9 percent and were trading 0.5 percent higher as of 10 a.m. in Stockholm, valuing the company at 14.7 billion kronor ($2.3 billion).

To contact the reporter on this story: Robert Wall in London at rwall6@bloomberg.net

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net


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