80 Rafale in the Emirates: the flip side of a historic contract

This is what we would call the “contract of the century” if the term weren’t overused. Less than three months after the uppercut of the cancellation of Australia’s submarine contract, the French side took a blinding revenge. As revealed by challenges On November 17, during Emmanuel Macron’s visit on Friday December 3, the United Arab Emirates announced an order for 80 Rafale fighter jets in their F4 standard, the largest export deal in the history of the French fighter jet. This monumental order worth 16 billion euros including armaments confirms the exceptional year for the Dassault device. With the additional order of 30 aircraft by Egypt (in addition to the 24 already purchased) and orders from Greece (24 aircraft) and Croatia (12 used aircraft), the order intake in 2021 reaches 166 in one year. An unprecedented number, equating to 16 years of Rafale production at current speeds.

This order, historic in every respect, obviously does not erase the trauma suffered by Australian submarines, a humiliation that is likely to haunt the French defense industry for a long time to come. But it compensates financially for more than the deficit associated with Canberra’s decision. Unconvinced? Take our calculator. The Australian order was estimated at 35 billion euros, of which 8 to 10 billion euros for the French part (Naval Group). The Emirati Rafale order, valued at €16 billion (€14 billion for the Rafale, €2 billion for MBDA’s Mica NG and Black Shaheen/Scalp missiles), is therefore almost twice as large. It also has two advantages that the submarine treaty did not have. On the one hand, the payment is made quite quickly: the down payment upon conclusion of the contract, i.e. now; and most of the delivery of the Rafales to Abu Dhabi, which is scheduled from 2027 to 2031. Payment for the Australian submarines would have arrived very late, with a good chunk during their respective deliveries, which are projected from 2032 to 2050.

Added value in France

Second advantage of the gigantic Emirati order: where the Attack submarines were supposed to be assembled in Australia (Osborne, near Adelaide) with very strong American content (the combat system developed by Lockheed Martin), the Rafales will be 100% in France made: assembly at Mérignac (Gironde), M88 engines at Villaroche (Seine-et-Marne), avionics at Thales at Haillan (Gironde) and primary parts at 500 French SMEs. Strictly speaking, therefore, the UAE contract is more interesting for French groups than the Attack contract, since almost 100% of the added value is on national territory (a total of 7,000 employees).

As the AUKUS trauma cannot be removed, the Rafale contract will therefore likely make it – much – more bearable. With this treaty, Paris shows that, despite Australia’s humiliation, it remains a leading partner for one of the most strategic players in the Middle East, which all the great powers (US, Russia, China) are fighting over. The French fighter had the luxury of overtaking Abu Dhabi’s order for 50 American F-35s, announced by Donald Trump in the final hours of his mandate. The Biden administration, which had attached conditions to the contract that were difficult to hear from the Emirates strongman, MBZ (stop rapprochement with China, deterioration in the performance of the F-35 compared to the version sold to Israel) , Paris knew. pretty skillfully slip into the gap. And wrap up the Rafale negotiations that began in 2008, with ups (a few), downs (many) and countless pauses.

80, a record number

The number of 80 aircraft is impressive. It goes beyond the number of Mirage 2000-9s that the Emirates plan to gradually replace (about 60 aircraft). She’s superior to the 50 F-35s that Abu Dhabi arguably hasn’t given up. It is twice the number of aircraft ordered by India and Qatar (36 aircraft). As a result, the order intake of the French defense industry will break the historic record of 2015 (16.9 billion euros), especially since the Emirates have also ordered a dozen Caracal heavy helicopters from Airbus Helicopters for a billion euros. Not so bad for a country that many observers had declared a geostrategic downgrade after Australia’s submarine contract was terminated.

A proud reaction from the French defense industry? The Australia affair and the approaching presidential elections may have caused Paris to be more aggressive in the current competitions. The big question is whether these good performances have not also come with a degree of “liberty” from Washington, eager to spare an irate Operation AUKUS ally. French negotiators in Greece had already noted less American aggressiveness over the frigate contract, leading to the contract for three FDI frigates being signed by the Naval Group in late September. “After the AUKUS crisis, Macron probably negotiated with Biden that the USA would let France do its business,” said a good expert on the industry. Which doesn’t mean that the Americans are dropping out completely: the gigantic Rafale order in no way excludes an upcoming F-35 order.

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