SOURCE: TUSHKAR SHIRODKAR / FOR MY TAKE / IDRW.ORG.
The United Aircraft Corporation presented to the world a new light tactical fighter jet named Checkmate at the MAKS 2021 airshow and what came after stunned everyone when it offered Checkmate at flyaway cost at just $30 Million per unit making it cheapest 5th Generation fighter jet even priced below several 4.5 Generation fighter jets as seen in official pamphlets of the company recently in the Dubai Air show 2021 where a Prototype has been put up for display but is it a scam or UAC actually can deliver on the ballpark figure quoted by them?.
To understand how Russians predetermined its price we have to understand how the Russian Military complex works, unlike Western Military Complex. Russian Military complex for generations right from Mig-15 could mass-produce jets and offer to them to export countries like India literally at a throwaway price that ensured Russian jets usually were brought up by those who had no access to the western technology or couldn’t afford one.
No Cost R&D
Checkmate is an amalgamation of the technologies that already have been developed either for the Su-57 or Su-35/30 Programs and has little or no research and development cost that is involved in the aircraft developmental period. Checkmate taps into the technology that already has been done and uses components that are already in service or are in production like the modified AL-41F1 engine (Izdelie 117) engine that powers the aircraft along with AESA Radar and several other systems like EW system, Avionics, and Radar Absorbing composite materials.
Margins and After Sales
$30 Million per unit is just the flyaway cost that doesn’t include a weapons package and spares and service/ maintenance package that kicks in when a client enters into negotiation. Russian Military complex is geared to deliver jets that are not comparable to the western jets in terms of quality and workmanship since they still use types of machinery and tools that simply can’t deliver precision cuts or quality due to which they can afford to keep the price low.
Russian Military complex usually makes money in after-sales and spare support where margins are anyway between 15-20% because the shelf life of those spares is often lesser than similar components of the western jets but they wear out fast which means repeated orders for the high consumables parts in the jet. Russian Military complex margins on a flyaway unit of each jet are usually pretty low and in some projects, it’s as low as 5% often catering to the large orders that the project might have received and it seems that to achieve a unit cost of $30 Millon, Russians exactly know how much orders will be required for a sustained production line since Checkmate will largely cater to the export customers.
Russian Jets are usually Cheap
Unlike Western jets that have a pretty low annual production rate that often contributes to higher unit costs after absorbing research and development costs, Russian jets are often offered at pretty low costs for example Su-30SM is billed at flyway cost of just $42 Million and aircraft like Mig-29UPG barely cross the $35 Million mark. Downtime of the Russian jets is pretty high due to higher wear out of the consumables and spares that often means the client needs to keep additional jets as backups or spare inventory that runs into several hundred that’s where the Russian military complex makes money.
Real Price of Checkmate
Prospective Clients of Checkmate also needs to factor in what level of customization could be required and funds that need to be shelled out to develop those modifications and incorporation of the additional technology along with spares and weapon package factored in and units ordered price can go as high as $100 million per unit. We need to remember that the $80 per unit cost of F-35A is just for the flyaway unit but once weapons and service packages are factored in unit cost breaches the $150 million mark especially for countries like India that doesn’t have an American ecosystem installed at home since it never operated American jets in the past.
Why India shouldn’t fall for it
India needs to remember why it pulled back from the proposed Joint venture to develop a 5th generation fighter jet based on the Su-57 as a base! It was Price. To make customization and modification to meet the requirements of the IAF, India not only had to foot the research and developmental cost of the jet but also had to order in numbers to make it a viable project for local production to take place. India had to pull out after India realized that It could have not got any IP rights while Russia was free to sell variants of these jets to other countries and India never could have received any royalties too.
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Article by TUSHKAR SHIRODKAR , cannot be republished Partially or Full without consent from Writer or idrw.org