DTN News - DEFENSE NEWS: BAE May Cut Typhoon Price To Win India Order
(NSI News Source Info) TORONTO, Canada - February 7, 2012: BAE Systems is considering lowering the price of its Eurofighter Typhoon to win back an $11bn (£7bn) Indian contract from France’s Dassault.
Ian King, BAE’s chief executive, said the company was considering a range of options to secure the deal to supply fighter jets, which could help prevent a major industrial setback for Britain.
A source close to the company said BAE was consulting with its partners in Germany, Italy and Spain to see what was feasible in the coming days and weeks.
India had previously changed its mind on defence contracts, the source said, adding there was “still some way to go” before any decisions by the country had been made.
The insider insisted the contract was still up for grabs, with Dassault’s Rafale only having been named as the lowest-priced compliant bidder rather than being awarded the contract.
The Government’s drive to kickstart growth and rebalance the economy towards advanced manufacturing suffered a blow last month when the Indian government named the French manufacturer as its preferred partner for the deal.
Trade union Unite warned the selection of the Rafale could have "serious implications" for BAE Systems and the UK aerospace industry. It is estimated that 40,000 UK jobs are supported by the project.
Winning the Indian contract would help sustain tens of thousands of jobs, although production is expected to gradually move to India if Britain won the deal.
BAE currently has enough orders for the Typhoon to maintain work until 2017.
The Typhoon is made by Britain's BAE, European giant EADS, and Italy's Finmeccanica. The UK accounts for 37.5pc of production with the aircraft assembled at BAE's aerospace facilities in Lancashire and suppliers including GKN, Ultra Electronics and Rolls-Royce.
Last year, BAE cut 3,000 jobs in the UK, partly because it had won fewer export orders for the Typhoon than planned.
