France plays down failure of Brazil deal for Rafale

France on Thursday played down its failure to convince Brazil to buy Rafale fighter jets, insisting it still has hope India or Gulf nations will finally become the first foreign buyers.

Brazil announced on Wednesday it had chosen the Gripen NG built by Sweden's Saab in a multi-billion-dollar contract for 36 new fighter jets, over Dassault's Rafale and US aviation giant Boeing's F/A-18.

The move was another blow to the Rafale programme, which has failed to win a single foreign sale after nearly three decades of development that has cost tens of billions of euros.

Speaking in Brussels, President Francois Hollande said Brazil's decision had been "expected... for several months" and that the Rafale will "hopefully be bought" by other countries.

Defence Minister Jean-Yves Le Drian told Europe 1 radio that Brazil had not been "a priority target" for Rafale sales, despite Hollande personally lobbying for the deal during a state visit to Brazil last week.

"We have other bigger prospects," Le Drian said. "We have good reason to believe that for India and the Gulf, there will soon be results."

Dassault is in talks to finalise the sale of 126 Rafale fighters to India and has opened negotiations with the United Arab Emirates over the potential sale of 60 planes. Qatar and Kuwait have also indicated they are interested.

So far only the French air force is equipped with Rafales, which have been used in fighting in Libya and Mali.

Shares in Dassault Aviation plunged by 3.79 percent in initial trading after the announcement but had recovered slightly by mid-afternoon and were down only 1.63 percent.

The failure to sell the aircraft to Brazil was "a new major disappointment for the Rafale, which is still having just as much trouble in finding export markets," said analyst Tangi Le Liboux at brokers Aurel BGC.

Le Drian admitted that Brazil's decision was a "disappointment" for the Rafale programme.

"It is a very good plane and France has been very satisfied with it, in Mali and elsewhere," Le Drian said.

Another French official, parliamentary relations minister Alain Vidalies, admitted however that Brazil's choice was "bad news for France".

He said a sale to India would still make the Rafale programme break even and vowed the government would do everything possible to ensure a sale.

"The desire is for this aircraft, which is a great plane that carries the French brand, to be sold, so we must summon all our strength," he said.

France initially agreed to buy 11 Rafales a year for its air force to help the programme, but has since moved to scale back the number to only 26 planes in the next six years.

The government is hoping at least one country will place an order by 2019 and is pinning most of its hopes on India.

by Hui Min NEO © 2013 AFP

Source: AFP
Date: Dec 19, 2013