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Tuesday, June 18, 2024

Fighter jet price seems to soar

UPDATED: The Norwegian government’s controversial but arguably predictable decision to buy new fighter jets from its most important ally, the US, has been hit with another major cost issue. Documents leaked to WikiLeaks and reported in newspaper Aftenposten indicate the price tag has jumped by 66 percent and may cost Norwegian taxpayers another NOK 12 billion.

Norway needs to replace its F16 fighter jets like these, and has agreed to buy around 50 new fighter jets from the US. Debate looks set to continue, though, over the deal. PHOTO: Forsvaret

The debate over the fighter jet purchase has rumbled for years, culminating in November 2008 when Norway’s left-center government chose what at the time was called the Joint Strike Fighter jet from US defense contractor Lockheed Martin.

The US jet, now called the F-35 Lightning II, was chosen over Sweden’s JAS Gripen, which was preferred by many local Norwegian authorities because of all the Norwegian-Swedish industrial cooperation it would involve and the jobs it would create. The Norwegian government, though, argued that the US jets were cheaper in the long run and fought hard for industrial jobs from Lockheed Martin as well. It’s also widely believed that the Norwegian government was under pressure from US authorities and didn’t want to offend its powerful ally and NATO partner. Sweden is not a member of NATO.

The Norwegian government, headed by Prime Minister Jens Stoltenberg of the Labour Party, said in 2008 that they would buy 48 jets at a cost of around NOK 18 billion, one of the biggest single public expenditures in Norway ever. A contract was to be signed in 2014.

Now the cost appears to have risen to NOK 30 billion, NOK 12 billion more than initially disclosed by the government. Newspaper Aftenposten reported last week that a document leaked to WikiLeaks from a meeting between Norwegian and US officials in September 2009 set the estimated price for the fighter jets at USD 5 billion, which would equate to NOK 30 billion, not the NOK 18 billion claimed a year earlier.

Part of the increase, but not all of it, can be explained by a planned boost in the order itself from 48 to 56 jets. Lockheed Martin reportedly has never been willing to offer a price guarantee, but current estimates in industrial magazine Aviation Weekly have suggested a price that for Norway could amount to around NOK 660 million each, plus the motor, yielding a total that’s almost double that announced just two years ago.

The price may come down if more countries buy the Lockheed Martin jet, which is why Norway’s agreement to do so was so important for the Americans. It was believed that would persuade other countries to do the same. To date, the US and seven “partner countries” have ordered as many as 3,200 of the fighter jets although some are trimming their orders for financial reasons.

More debate expected
Debate over the price was already rising on Norwegian Broadcasting (NRK) Tuesday. Stoltenberg’s government hadn’t disclosed the potentially huge price increase and political observers were wondering how the opposition would react when they return to parliament in January. In most cases they would pounce on such an opportunity to criticize the government, especially when so much money is involved, but in this case, the conservative parties in opposition generally are even less likely than the left-center government to criticize or challenge the US. Questions are swirling, however, and more debate is likely.

Aftenposten reported that Norway’s trade ministry wouldn’t comment on the price increase, nor would a defense ministry official who leads the fighter jet project, Pål Bjørseth, comment on the WikiLeaks document. Bjørseth claimed, though, that he wasn’t worried about the price estimates reported in Aviation Weekly.

“If we were buying at that price the jet acquisition would be much more expensive … but we’re not,” Bjørseth told Aftenposten. He believes the price will still go down as more countries order the jets.

Signs emerged later in the week that other defense ministry officials and government politicians were gearing to refute the WikiLeaks report. State Secretary Roger Ingebrigtsen of the Labour Party told newspaper Avisa Nordland that he didn’t recognize the NOK 30 billion price tag at all, claiming the defense ministry is still operating with the NOK 18 billion originally quoted by Lockheed Martin for 48 jets.

Ingebrigtsen stressed that the WikiLeaks document reported by Aftenposten referred to a conversation between representatives from the trade ministry and the US Embassy, while the fighter jet project is being handled by the defense ministry. The project is ongoing, he said, and a final price hinges on orders and production.

EDITOR’S NOTE: Oslo-based newspaper Aftenposten has obtained unrestricted access to embassy cables and other documents initially leaked to WikiLeaks, and is regularly reporting on their contents. Views and News from Norway will be following Aftenposten’s reports, so stay tuned for more stories on leaked embassy cables.

Views and News from Norway/Nina Berglund
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