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Strike Eagle Sale Sets Stage For Lucrative SNEP II Deal

Posted by Carlo Munoz on

WASHINGTON: Boeing’s big win to supply Saudi Arabia with F-15 fighters could set up a larger, more lucrative deal to revamp the country’s naval forces, according to company officials.

Washington and Riyadh inked a $29.4 billion deal to provide 84 new Boeing-built F-15E fighters for the Royal Saudi Air Force. Boeing and the Air Force will also modernize 70 of the fighters already in the fleet, according to the deal signed this week. The first batch of new Saudi Strike Eagles will be delivered by 2014. The remodeled jets will hit the Saudi fleet later that year, according to a Pentagon fact sheet. The new and refurbished F-15 jets will be outfitted with a number of capabilities requested specifically by the Saudi military, Dennis Muilenburg, president and CEO of Boeing’s defense, space and security division, told Breaking Defense yesterday. Those Saudi-specific amenities include a new digital electronic warfare package, a “fly-by-wire’ capability and the next-generation Active Electronically Scanned Array radar, he said. That is the same radar on board the F-35 Joint Strike Fighter.

The Saudi sale is the first of many Boeing hopes to lock in over the next few years, Muilenburg said. Company officials are looking to increase foreign sales of their military aircraft by 25 to 30 percent this fiscal year, he said. The F-15E deal could also bring the company a step closer to securing part of what could be one of the most lucrative foreign military deals of the decade.
Yesterday’s deal with Riyadh gave Boeing “a boost in our momentum” towards participating in the Saudi Naval Expansion Plan II, Muilenburg said. The SNEP II program — worth an estimated $10 to $20 billion over the next decade — is focused on reconstituting the eastern fleet of the Royal Saudi Navy. American defense firms have been clamoring for a chance to sell the latest and greatest naval hardware to Riyadh. For their part Boeing is looking to supply the Saudis with next-generation fighters, helicopters and intelligence, surveillance and reconnaissance aircraft for SNEP II. This week’s Strike Eagle sale to the Saudi air force is certainly a positive step in that direction, according to Muilenburg. Aside from its implications for a potential SNEP II deal, the F-15E sale also helped Boeing rebound from its loss in Japan’s recent fighter competition.

Boeing’s F-18 E/F was beat out by the Lockheed Martin-built F-35 to be Japan’s next fighter aircraft. Tokyo inked the deal for 40 to 50 JSFs earlier this month. Boeing’s win this week proves the company “still has a robust pipeline” into international markets, despite the loss to the F-35, Muilenburg said. “Anytime we win business. . . it benefits [all fighter programs],” he added.

The recent influx of U.S. military hardware into the Saudi Arabia comes as simmering tensions in the region threatened to bubble over this week. The situation began when Tehran announced plans to shut down the Straits of Hormuz. The key waterway bordering Iranian coastline is a vital transit point for commercial and military vessels looking to enter the Persian Gulf. The threat comes as Iran is in the midst of their own massive buildup of their naval forces. The announcement drew a sharp rebuke from commanders of the Navy’s Fifth Fleet, the headquarters of Naval Forces Central Command. “Anyone who threatens to disrupt freedom of navigation in an international strait is clearly outside the community of nations. Any disruption will not be tolerated,” according to a NAVCENT statement. Iranian navy eventually backed off their threat but continues to conduct wargames in the area.

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