The Weekly Wire: For Your Situational Awareness 12.5.16
On November 23, the Lithuanian Navy officially received its P15 patrol ship, a former Danish Navy Flyvefisken-class vessel, from Denmark. It was originally purchased in September. The ship, along with two anti-submarine detection sonar systems, was bought for an estimated €6.5 million and will join three other Flyvefisken-class vessels previously purchased from Denmark in Lithuania’s Patrol Ships Division, which is responsible for patrolling territorial waters and exclusive economic zones as well as search-and-rescue operations. This P15, transferred at a ceremony at the port of Korsør in Denmark, is expected to sail into the Lithuanian port of Klaipėda in early December and be christened in January 2017.
Norway has set aside $1.5B to purchase five P-8 Poseidons that will function in an electronic warfare and marine surveillance capacity and are expected to be delivered between 2021 and 2022. The new aircraft will replace six P-3 Orions and three DA-20 Jet Falcons that are currently filling those requirements. The purchase appears to have been prompted by Norway and the United Kingdom reaching an agreement on maritime patrol aircraft cooperation. Avascent Analytics’ data indicates that the Norwegian market for fixed-wing ISR/EW/special mission aircraft has an annual value of $205.6M through 2021. Up until now, 40% of that market was open to new business, much of which has been filled by the new purchase.
Canada will soon begin discussions with Boeing regarding an F/A-18 purchase as an interim solution while the nation tries to decide on a new multi-role fighter. Canada is strongly considering the F/A-18 as a replacement for its CF-18 Hornets, which are unable to handle Canada’s current security commitments due to a combination of age and a lack of sufficient capabilities. At the same time, Canada will begin a competition to find a long-term replacement fighter. The cost of the potential F/A-18 deal was not disclosed but is estimated at $1.5B for a potential 18 aircraft. According to Avascent Analytics, the Canadian market for fixed-wing fighter/attack/bomber aircraft will have an annual size of $224.1M through 2021, and 74% of the market remains open to new business. However, almost the entirety of that open opportunity space is earmarked for the new multi-role fighter.
Brazil is moving forward with a $5 billion investment in Saab’s Gripen NG after allocating a total of $413.2 million for the combat aircraft in the 2017 defense budget. The Brazilian Air Force is interested in procuring 36 Gripens, with the first aircraft to be delivered in 2019 and the final delivered by 2024. Brazilian company Embraer Defense and Security has teamed up with Saab to create the Gripen Design and Development Network (GDDN), which will work on the Gripen NG development and testing in Brazil. Saab was previously announced the winner of Brazil’s FX-2 program in 2014, beating out Boeing’s F/A-18 and Dassault’s Rafale. Avascent Analytics has identified the combat aircraft market in Brazil growing at a rate of 10.3% over the next five years, though only 4.8% of the market remains open.
Belgium / Netherlands
On November 30, Belgium and the Netherlands signed a letter of intent to jointly acquire four frigates and twelve minehunters. Furthermore, the letter of intent covers joint maintenance and repairs of the ships, deepening an already strong history of maritime cooperation between the two countries. Each country will spend about $2.2 billion on the joint acquisition, and deliveries are expected to occur between 2023 and 2030. The Netherlands will lead the acquisition of the frigates, which are expected to be optimized for anti-submarine warfare. Belgium will lead the acquisition of the minehunters, which may be able to launch remotely controlled vehicles. It is not yet clear how the 16 ships would be split between the two countries, or if all the ships would be jointly owned and operated. Past talks of who would operate which ships have considered an option in which Belgium would operate the minehunters and the Netherlands would operate the frigates. But in Belgium’s 2030 Strategic Vision on Defense, Belgium included two frigates and six minehunters, which suggests the possibility of splitting not only the cost but the ships evenly as well.