US engine manufacturer Pratt & Whitney has signed an agreement with the Ministry of Defense for regular maintenance of warplanes for the Israel Air Force. The amount of the agreement is in excess of $500 million. Representatives of the US company and a Ministry of Defense delegation in the US signed the agreement yesterday.
Under the agreement, Pratt & Whitney will maintain the engines used in the Israel air force's main combat planes, the F-16I, called Sufa (Storm) in Israel, and the F-15, called Ra'am (Thunder) in Israel, for 15 years. The agreement is slated to go into effect next January. The Ministry of Defense said that under the new agreement with Pratt & Whitney, engines in good repair would be guaranteed for the air force's main combat planes in the coming years, including regular maintenance work on the engines, logistic prognostication, renovation and upgrading of the chasses, a rapid supply of spare parts, etc.
The two planes involved are the most advanced used by the air force. The F-16I is a single-engine plane made by Lockheed-Martin. Israel previously bought 100 F-16Is. The F-15I is a twin-engine plane made by Boeing. Both planes are equipped with Pratt & Whitney engines. The Ministry of Defense also said that it had been agreed that the US company would hire Israeli companies as subcontractors in the framework of the air force maintenance agreement. The companies involved are Bet Shemesh Engines Ltd. (TASE: BSEN), Israel Aerospace Industries Ltd. (IAI) (TASE: ARSP.B1), and Chromalloy Israel. The Ministry of Defense said today that these understandings would ensure a significant volume of business for Israeli industries in the coming years.
In addition to a significant improvement in availability of engines for warplanes, under the new agreement, the US company will also ensure periodic upgrades of the engines to the most up-to-date configurations, while improving their safety and reliability. The defense establishment says that the agreement has potential for saving on air force personnel in logistical planning, supervision, management, and other areas, given the fact that the air force and the Ministry of Defense expect an increase in the prices of spare parts for these planes in the coming years.
The contract is also consistent with the Gideon multi-year plan recently formulated by the IDF, which provides for outsourcing some of the army's activities in order to save on costs.
Published by Globes [online], Israel business news - www.globes-online.com - on December 1, 2015
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