Norway Delays Decision on F-35 Buy to 2008
By GERARD O’DWYER, HELSINKI
Norway’s decision to continue funding development of the F-35 Joint Strike Fighter (JSF) should not be misunderstood as a commitment to purchase the U.S. aircraft, Defense Minister Anne-Grethe Strøm-Erichsen told a meeting of the Storting’s (national legislature’s) Parliamentary Defense Committee on Jan. 3.
“A decision on what choice of fighter jet Norway will buy will not be made until 2008,” Strøm-Erichsen said. “Meanwhile, negotiations will continue with two other fighter jet projects, Eurofighter’s Typhoon and Saab’s JAS Gripen.”
Norway’s present position is that it will continue to contribute to the JSF’s development costs, but wants to select a replacement fighter from among the three candidate aircraft. Norway also wants to see more in terms of industrial subcontract deals before the JSF can become a serious contender, she said.
However, a senior Defense Department official said that Norway would not consider entering into a final development contract on JSF until it was guaranteed “optimum industrial terms” by prime contractor Lockheed Martin.
“We intend to continue funding the JSF program,” Strøm-Erichsen said. “We are aware that the issue is controversial, but we have stated repeatedly that our funding of the JSF program does not commit Norway to buying the aircraft. Our options will remain open.”
Lockheed is in negotiations to sell 48 JSFs to Norway as part of an $8 billion program to replace the Norwegian Air Force’s aging F-16s.
The negotiations have been complicated by Norway’s insistence that Lockheed deliver an industrial offset package that includes generous fighter systems and component subcontracts for indigenous industries, with the potential for technology transfers.
“The issues are many and complex,” an Oslo defense industry analyst said. “Norwegian industry chiefs want more higher-grade contracts. They want large-scale technology-based systems contracts. For its part, Lockheed Martin has been slow to offer such an industrial package. Norway is one of eight partners in the JSF program, and Norway is regarded as a junior rather than senior partner. It will be interesting to see how talks progress.”
Gaining access to key fighter technologies in the JSF program remains a significant barrier in Norway’s negotiations with Lockheed, said the analyst.
“In real terms, those Norwegian industries with a particular defense focus, such as Nammo and Kongsberg, not alone want the contracts to be large and lucrative, but they also want access to core and secondary technologies being used in the F-35,” the analyst said. “That said, this is also an issue for senior partners in the JSF program like Canada, Italy, the Netherlands, Australia, Britain and Turkey.”
Espen Barth Eide, the secretary of state at the Defense Department, said Norway’s decision to delay the signing of a final development agreement on the JSF was required to “protect Norway’s interests” in the fighter program.
“We need and want to obtain the best possible agreement with the U.S. manufacturer of the Joint Strike Fighter,” said Barth Eide. “We first want to get all facts on the table, and it will be Norway who decides if and when to sign a final development agreement.”
Norway thus far has contributed $64.4 million to JSF development.
Lockheed Martin will need to offer Norwegian industry improved terms before Norway will sign a production agreement with the United States, said Barth Eide.
Possible ‘Downstream Problems’
The economic and political problems besetting Lockheed’s negotiations with Norway were highlighted Dec. 12 by Richard Harris, the U.S. military attaché to Norway. Harris warned that a further postponement by Norway of signing a final development contract could result in “downstream problems for Norway.”
“A postponement in the signing of a final development agreement could mean the loss of contracts for the Norwegian defense industry in the further development of the fighter plane,” he said in a statement.
Lockheed Martin officials have not “detected any alert flags indicating trouble” in talks with Norwegian defense officials about the industrial terms, said company spokesman John Smith. Lockheed and Norway are “in the final glide path” toward signing the development agreement, he said.
However, Barth-Eide said that Norway would not be rushed and also may decide to provide financial support toward the development of the JAS Gripen and the Eurofighter Typhoon.
“We want three equally placed candidate aircraft as part of the fighter selection process before a decision in 2008,” said Barth Eide.
Encouraged by Lockheed Martin’s difficulties, both Saab and Eurofighter have intensified contacts with Norway.
Saab and Eurofighter announced on Dec. 22 that they had received invitations from Norway’s Ministry of Defense to discuss a model for cooperation related to a possible replacement of the Norwegian F-16 fighter. In the case of Saab, the talks are expected to begin early in 2007, Saab said.
Norway is being offered an enhanced standard of the JAS Gripen multirole fighter, the so-called Gripen N. Saab said the offer is “backed by the Swedish government, and also includes Industrial cooperation and development on several levels.”
“We have already had very good and interesting discussions with the Norwegian government, the representatives from political parties, the Armed Forces and Norwegian industry, and we are really pleased to have the opportunity to take it one step further. This invitation marks an important step in putting Saab on equal terms with other competitors,” said Hans Rosén, Gripen International’s Norway project director. •
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