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M-346 Rollout Marks Israeli-Italian Mega Deal

Mar. 22, 2014 - 03:45AM   |  
By TOM KINGTON   |   Comments
Alenia Aermacchi is building 30 M-346 trainers for Israel.
Alenia Aermacchi is building 30 M-346 trainers for Israel. (Alenia Aermacchi)
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VENEGONO, ITALY — Alenia Aermacchi has rolled out its first M-346 jet trainer for Israel, part of a reciprocal deal covering satellites and early warning aircraft for Italy. The deal has boosted ties between the countries and may now see Tel Aviv sending its F-35 joint strike fighters to Italy for maintenance.

Officials from the defense ministries of both countries talked up their close relationship as they met in Italy on March 20 for the rollout of the first of 30 M-346 jets Israel has ordered — the first non-American plane the country has bought for decades.

“I hope the momentum will continue,” said Brig. Gen. Shmuel Tzuker, head of the procurement and production directorate at the Israeli MoD. While in Italy, Tzuker said he also visited Italy’s Cameri air base near Milan, where a final assembly and maintenance facility is being built for the F-35 — an aircraft both Italy and Israel are acquiring.

“It would make a lot of sense for us to maintain JSFs in Italy rather than sending them to the US,” he said.

Alenia is due to deliver the first three M-346s to Israel on July 10, with a total of nine to be delivered by year’s end. The first jets will enter service in 2015, Tzuker said. Israeli ground technicians and pilots will start training at Alenia’s Venegono facility near Milan next month, Alenia officials said.

The firm aims to turn out about two Israeli jets a month from its new Venegono assembly line, delivering 18 in 2015 and the final three in 2016 in a deal worth €450 million (US $625 million). Alenia will then start working on Poland’s order for eight aircraft. The last M-346 of 12 ordered by Singapore was delivered this month, and five of Italy’s six will be delivered by year’s end.

Under the 2012 deal to sell the M-346 to Israel, Italy agreed to spend €580 million on two Gulfstream early warning aircraft equipped by IAI, to be delivered in 2016, and €170 million on an Israeli-built optical satellite to be launched in September 2015 using the European Vega launcher.

The deal, which Alenia CEO Giuseppe Giordo called “a major collaboration,” was created in March 2011 at a meeting between Gen. Claudio Debertolis, then-Italy’s procurement chief, and Gen. Udi Shani, then the Israeli MoD’s director-general.

“We talked about a complete package in which national products could be exchanged,” said Debertolis, who has retired. “Shani drew up the plan for 30 trainers and two Gulfstreams, but we needed another project. With the satellite, for which Italy had a strong requirement, we had the balance.”

He said signing all the contracts simultaneously was complex but worth it — “a guarantee for both sides.”

“Gulfstream asked a high price, knowing the strategic importance of the sale, but we got them down,” he added.

In addition to the product contracts, the Israeli government also obtained project financing from Italian banks for part of its purchase, as part of the deal.

Apart from its deal with Alenia, Israel separately signed a US $750 million contract for the M-346 engines with Honeywell, which was covered by US foreign military financing provisions, and a $600 million deal with an Elbit- Israel Aerospace Industries consortium to provide the ground segment of the training set-up and 20 years of service.

Four simulators provided under the contract by the Israeli firms, which are built by CAE, with software provided by Alenia, will begin arriving in July.

One Alenia official said the firm was working on software to allow simulators to be linked in real time to the simulation function on board the aircraft, so a student flying a simulator will be “seen” by the pilot in the jet, as if they were sharing the same airspace. Vice versa, the simulator would also show the real jet.

“Give us six months to perfect this,” said the official, adding that he expects Israel to use the technology when it is available.

While CAE has been system integrator for the simulators in the M-346 contracts for Italy and Singapore, Elbit will take over that role for Israel, but also for the forthcoming Polish deal, the Alenia official said.

CAE is also teamed with Alenia and General Dynamics to pitch the M-346 for the US Air Force’s T-X trainer program.

Tzuker said that apart from the reciprocal purchases that sweetened the M-346 deal, he also considered that the jet’s twin engines, as an extra guarantee of safety, were one reason to pick the trainer over its rival in the competition — the South Korean T-50.

He said the complex negotiations with Italy had been “tough,” but the relationship between the two procurement offices is “now very good,” and when he had visited Italy’s JSF assembly line this month he was surrounded by “familiar faces.”

The M-346 deal, he said, “was a milestone for the future.” ■


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