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Defence deal greenlights fighter jet upgrade

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07:38 CET+01:00
Swedish defence company Saab has struck a 47 billion kronor ($7.4 billion) deal with the country's air force to develop the Jas Gripen E fighter jet, the same model marketed to Switzerland.

"This is an historic event for Saab," CEO Håkan Buskhe said in a statement.

"We're taking the next step, which also greatly increases our export potential for many years to come."

The agreement covers the period 2013-2026, but leaves the door open to terminate parts of the contract if the Swedish military's equipment wing (Försvarets materielverk, FMV) chooses to.

FMV has placed an initial order worth 2.5 billion kronor, reported the TT news agency. Several further orders are likely in 2013 and 2014.

If any terminations take place, Saab will have the right to certain compensatory payments.

In Sweden, Saab will modify about 60 existing Gripen C planes to convert them to be closer to the new E model.

"Our existing customers who operate the Gripen C or D will be able to benefit from the development work," Buskhe said.

Switzerland is still pondering its would-be purchase of 22 Gripen E fighter planes.

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TT/The Local/at

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