Uncertainty over future of IAF's Jaguars

Will the IAF pay $2.4 billion to refit 80 Jaguars with powerful Honeywell engines?
Ajai Shukla reports.

The plan to extend the service life of the Indian Air Force's Jaguar fleet, by equipping 80 of the fighters with new engines, is in trouble.

Indian planners believe Honeywell, the sole vendor in the project, is demanding an exorbitant price to replace the Jaguar's existing Rolls-Royce engines.

Hindustan Aeronautics Limited, which is leading the project, has written to Honeywell protesting its 'high and unacceptable quote', which HAL says will 'kill' the plan to re-engine the Jaguar.

The IAF, HAL, and Honeywell sources confirm that the United States firm has quoted $2.4 billion for 180 engines -- which include 160 engines for 80 twin-engine Jaguars -- and 20 spare ones.

This amounts to $13.3 million (Rs 95 crore/Rs 950 million) per engine.

It has taken the cost of 're-engining' each Jaguar to a prohibitive Rs 210 crore (Rs 2.10 billion), including Rs 20 crore (Rs 200 million) per aircraft that HAL will charge to integrate the new engines in the fighter and to flight-test and certify those.

This correspondent learns that, given Honeywell's high quote, the IAF has put on hold the next step of the Defence Procurement Procedure, which is to obtain the defence ministry's 'acceptance of necessity' for the project.

The IAF has six Jaguar squadrons, comprising 120 fighters.

Of these, only 80 latest ones are getting new Honeywell engines, while the older 40 Jaguars will fly with their original Rolls-Royce engines.

If the 're-engine' project fails, all six Jaguar squadrons will retire.

The IAF did not respond to queries.

This correspondent examined a detailed protest note that HAL sent to Honeywell this month, arguing that the US firm's current $2.4 billion quote, which can be reduced to $1.9 billion, prices each engine at twice that of an earlier quote, submitted by Honeywell in 2013.

That quote was submitted when the plan was for Honeywell to supply 275 engines.

That included 240 engines for all 120 Jaguars, plus 35 engines spare.

For all these engines, Honeywell had demanded $1.634 billion, or just under $6 million per engine.

HAL's note to Honeywell points out that its current quote of $13.3 million per engine is more than double the 2013 quote.

Even if a consolidated order were placed, which would bring down Honeywell's cost to $1.9 billion, or $10.6 million per engine, that is still 75% higher than the 2013 price.

In 2013, Honeywell was also responsible for integrating the F-125IN engines with the Jaguar, flight-testing and certification, developing a new alternator to power the other aircraft systems, and providing maintenance know-how.

The US firm had quoted an additional $2.1 billion for all this, taking the 2013 quote to $3.734 billion.

Given the unaffordability of this, HAL undertook to lead the project, assuming responsibility for integrating the F-125IN engine with the Jaguar, and carrying out all the airframe modifications, aero analysis, flight-testing, and certification that Honeywell was responsible for in the 2013 tender.

While Honeywell had quoted $1.6 billion for this work in 2013, HAL has now quoted under $300 million.

Since Honeywell has not yet submitted a formal quote, it still has the opportunity to reduce its costs.

The figures which it has is for determining 'rough order of magnitude' cost, or a rough, ballpark figure for the IAF to obtain a green light from the defence ministry for the 're-engine' project.

Honeywell's high quote is forcing the IAF to rethink, but a revised ROM could set things back on track.

However, Honeywell sources tell this correspondent that, after years of delay and expenditure on the 're-engine' project, the company has concluded that the IAF is not serious about the contract and that it would serve no purpose to spend more money, resources and mind space on this.

Honeywell sources say they have spent at least $50 million, including, buying two old Jaguar fighters to physically integrate the F-125IN engine with those airframes.

Another $50 million has been spent on expenses relating to the contract.

So exasperated is Honeywell that it insisted on charging HAL $73,000 for two visits by HAL officials in 2017 to its facility in Phoenix, Arizona, to examine the integration work already done by Honeywell.

"We will not spend a dollar more on this," says a Honeywell executive.

Honeywell's pessimism is also evident in the company's decision not to participate in the Aero India 2019 show in Bengaluru next month.

The F-125IN engines, were India to order them, would be built in Taiwan by the International Turbine Engine Company, a joint venture between Honeywell and the Taiwanese government's Aerospace Industrial Development Cooperation.

ITEC builds the F-124 engine, which powers Taiwan's F-CK-1 Ching-kuo fighter. The F-125IN is the same engine, with an afterburner to increase peak thrust.

The Jaguar's current Rolls-Royce Adour 804/811 engines deliver a maximum thrust of 32.5 KiloNewtons.

In comparison, Honeywell's F-125IN engines generate 40.4 KiloNewtons each, with full afterburners, providing it a significant combat edge.