July is generally a sleepy month in Europe, with most of the continent on summer holidays. But last month saw three developments that together could signal a profound shift in direction for the European aerospace and defense industry.
In the first place, France and Germany agreed to study the joint development of a next-generation fighter jet, for introduction by the late 2030s. This was matched by the British Ministry of Defense revealing a mock-up of a future combat aircraft, nicknamed the Tempest, at the recent Farnborough Airshow.
Finally, the chief executive of Airbus, Tom Enders, called on Europe to create a single pan-European entity to develop a sixth-generation fighter jet, in essence leapfrogging ahead of so-called fifth-generation fighters such as the US-designed F-35 Joint Strike Fighter (JSF).
Enders, who led the unsuccessful 2012 effort to merge the Franco-German-Spanish Airbus with the British BAE Systems, reportedly wants to create a single “European military aircraft company” that could likely unite the defense aerospace divisions of all the major European aerospace manufacturers: Airbus, BAE, Italy’s Leonardo, France’s Dassault, and Sweden’s Saab.
Failure to do so, he said, would leave Europe without any combat-aircraft programs after the 2030s that could viably compete with the world-dominating JSF.
Moreover, to be competitive with the Americans, it is imperative that Europe coalesces around a single fighter program. “There’s just no room for three different programs, not even for two,” Enders said. Even Brexit, it can be inferred, should not get in the way of such an effort.
Exports to Asia-Pacific floundering
Enders’ wake-up call for Europe is a long time coming. The European fighter-jet business has been losing ground to other producers for several years. Europe currently builds three fourth-generation-plus fighter jets: Eurofighter Typhoon, jointly developed and manufactured by four European countries – the United Kingdom, Germany, Italy and Spain – the French Rafale, and the Swedish Gripen.
Asia has been a particularly frustrating market for Europe’s fighter-jet manufacturers, especially in the light of successes by its competition. The US F-15 (ironically, an even older design than the European models) stole potential sales away in South Korea and Singapore. Russia has sold hundreds of Sukhoi Su-27s and Su-30s to India, Indonesia, Malaysia and Vietnam. Saab sold a dozen Gripen fighter jets to Thailand, but that is about it.
France had chalked up a huge sale of 126 Rafale fighter jets to India, which included a huge local licensed-production deal. That plan fell through, however, and India ended up buying just 36 Rafales off-the-shelf.
Will the F-35 dominate the Asian market?
It is the Joint Strike Fighter, however, that offers the greatest long-term challenge to the European fighter-aircraft manufacturers. The F-35 is one of only three fifth-generation fighters currently in existence – the F-22 Raptor and the Chinese J-20 being the other two – and it is the only one currently available for export.
No other combat aircraft on the international market approaches the JSF in terms of technology, particularly in stealth and avionics (that is, radar and other on-board sensors). It is simply in a class by itself and represents a life-or-death threat to its European competitors.
A multinational development and production program, the F-35 has 11 partnering nations, led by the United States. Many of these countries – the US, the United Kingdom, Israel, Norway, the Netherlands and Australia – have already announced their intention to buy the JSF, while the others – Singapore, Turkey, Denmark and Italy – are likely to place orders within the next few years. In addition, two non-partnering countries in Asia – Japan and South Korea – have already purchased the F-35.
Compounding the Europeans’ dilemma was the fact that they had no fifth-generation fighter-jet programs to compete with the JSF. The Typhoon, Rafale and Gripen were all initiated in the early 1980s; consequently, these planes are getting a bit long in the tooth.
Why Europe’s fighter jet plans are so critical
Consequently, the Europeans, through inaction, risk ceding the future global fighter business to the US. The F-35 is likely to dominate this market for the next 20 years. This, in turn, could leave the US in an unassailable position as the world’s predominant fighter-aircraft producer.
Combating this growing market dominance by the F-35 is of existential criticality to the European fighter jet manufacturers. Europe’s defense industry depends on exports to survive; indeed, in the case of most European aerospace and defense companies, overseas sales account for anywhere from 50% to 75% of their revenues.
Europe’s defense industry believes in arms exports the same way a drowning man believes in life-preservers. It makes perfect sense, therefore, for the Europeans to begin work on a sixth-generation fighter in an attempt to overtake the Americans technologically and regain some of their market competitiveness.
It also makes sense for the Europeans to unite around a single project and a single design. To echo Airbus’ Enders, Europe simply cannot afford to compete internally with two or three fighter-jet programs. In the first place, it does not have the funds – Europe’s combined military aerospace research-and-development spending amounts to only around €10 billion (US$11.6 billion) annually (considering that the F-35 cost at least US$55 billion to develop).
More important, Europe cannot afford any more internal fissures that would keep its eyes off the prize of a sixth-generation combat aircraft. To do so could sound the death knell for the European fighter-jet business.