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French aviation giant Dassault is caught in a conundrum. With a staggering backlog of 211 Rafale fighter jets 141 for export and 70 for the French Air Force by the end of 2023, the company is yearning to ramp up production to meet the surging demand. However, a combination of factors threatens to turn this ambition into a ten-year wait for deliveries.

Dassault aspires to increase production from the current rate of 13 jets per year to 20. This would significantly reduce the backlog, but even at this pace, clearing the current queue would take a decade. Potential new customers, particularly those seeking swift deliveries, might be discouraged by this extended wait time.

The dream of a higher production rate faces several hurdles. Dassault contends with an engineering talent shortage within its supply chain. Furthermore, many suppliers are hesitant to invest in expanding workforces, factories, and tooling due to concerns about the sustainability of a high production rate. They fear being burdened with excess capacity if demand drops in the future.

Dassault views India, a major Rafale customer with a potential order for 27 Rafale M jets in 2024, as a key partner. The company has proposed taking over Dassault Reliance Aerospace Limited (DRAL), a joint venture with Reliance Group, to facilitate the outsourcing of Rafale components. This, coupled with establishing a second production line in India utilizing DRAL’s Nagpur facility, could potentially ease the backlog.

Dassault envisions this second production line churning out 6-8 Rafales annually. While this wouldn’t be an immediate solution, it signifies a long-term commitment to addressing the backlog and fulfilling future orders, including those from India.

The Rafale’s success story is undeniable, but its current backlog casts a shadow. Dassault’s ability to overcome these production bottlenecks and potentially establish a second line in India will determine how quickly the company can fulfil existing orders and capitalize on new ones.

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