Procurement and Operating Costs

An analysis has been conducted comparing the cost of replacing EFA/Typhoons with late model F-16s. Two scenarios are examined using 3 different average exchange rates (1 GBP=1.5 USD, 1GBP=1.75 USD, and 1 GBP=2.0 USD). The discount rate used to discount the cash flows is a typical recent rate for the UK Government 10 year bond rate (5.1%) which should correspond reasonably well to the UK Government’s current cost of capital. All scenarios assume that aircraft are operated for 20 years and are flown for 20 hours per month (240 hours/year). The analysis utilized the NPV formula included in Windows Excel 2003 and assumed that procurement takes place in year 1 with average operating costs then being incurred in years 2 through 20. Neither aircraft is assumed to have any salvage value or disposal cost at the end of year 20.

To simplify the analysis, all already incurred, already commissioned, and forecast development costs for the EFA are assumed to be sunk and therefore disregarded. Development costs in excess of 20 million GBP per aircraft of the forecast procurement of 232 appear to have already been incurred. Significant additional development costs can be anticipated as, for example, the aircraft is modified for strike missions. Clearly, incorporating still to be incurred development costs would enhance the attractiveness of the F-16 vs. the EFA.It is also assumed that there are no cancellation charges for refusing to buy aircraft not already ordered.

The DCF analysis is used to calculate two figures for each exchange rate. These are:

• How many F-16s can be purchased and operated for each EFA Typhoon that is not purchased and operated for 20 years.

• How many F-16s can be purchased and operated for 20 years for each EFA Typhoon that is purchased and immediately scrapped. In this case the salvage value (value if sold as scrap or to a third party) is assumed to be equal to the cost of disposal, and therefore disregarded.

Procurement Costs

The F-16 is estimated to have a fly away cost of USD30 million per aircraft in volume production and actual procurement cost when fully kitted is estimated to be USD85 million³. Industry interviews indicate current operating costs are estimated to be USD36 thousand per hour giving annual costs (20 hours/month) of USD8.64 million, which is used in the DCF calculation.⁴

The equivalent flyaway cost of the EFA is estimated to be 61.5 million GBP, although given the lack of transparency regarding both UK and Saudi procurement this probably should be viewed as a lower limit.⁵ The cost, when fully kitted out, is estimated to be approximately 142.5 million GBP.⁶ EFA Typhoon Operating Costs have been estimated based on flyaway costs of 61.5 million GBP as being approximately 22.3 million GBP per year⁷. Note that the ratio of fully kitted cost to estimated flyaway cost is slightly lower for the EFA (2.3) than it is for the F-16 (2.8). Operating costs reflect the relative degree of complexity of the two aircraft and total number expected to be produced (4,000 plus F-16s vs. approximately 1,000 EFAs), being approximately, 10% of fully kitted costs for the F-16 and 15% of the EFA Typhoon.

Given the above assumptions, DCF values were calculated for the EFA Typhoon both for a) the purchase of a new aircraft fully kitted out and then operated and b) for the operating costs of an aircraft that had already been purchased. In the case of a) the aircraft being purchased then operated, the DCF per aircraft purchased is 390 million GBP. In the case of b) the operating costs for an aircraft already purchased and then operated for years 2-20 had a DCF of 255 million GBP.

In contrast, the DCF for the purchase of a fully kitted F-16 in year 1 and then operated for years 2-20 was 179 million USD.

Figure 1. shows the number of F-16s that on a DCF basis a purchaser could expect to have for each EFA forgone for both the scenario in which an EFA was not procured and for the scenario in which it was procured and scrapped. Three exchange rates are used. These are:

• 2.00 USD=1GBP

• 1.75 USD=1GBP

• 1.50 USD=1GBP

In the case of 2 USD=1GBP the RAF could have 4.3 F-16s for each EFA it did not purchase and 2.8 for each one it scrapped. In the case of an exchange rate of 1.75 USD= 1 GBP it could have 3.8 F-16s for each EFA it did not purchase and 2.5 for each one it scrapped. In the case of 1.5 USD = 1GBP it could have 3.3 F-16s for each EFA it did not purchase and 2.1 for each EFA it scrapped immediately after purchasing, It should be noted that the DCF exchange ratio of F-16s to EFAs is somewhat higher if fly away cost rather than fully kitted out cost is used. For example, at an exchange rate of 2 USD= 1GBP, the number of F-16s that can afforded for each EFA not purchased is 4.93.

Figure 2 shows the number of F-16s that could be purchased for the same DCF as 232 EFAs at these exchange rates.

At an exchange rate of 2USD= 1 GBP the procurement/operating costs of 232 fully kitted EFA Typhoons would have allowed the purchase and operating of 1,009 F-16s. At an exchange rate of 2USD= 1GBP a decision could be made to scrap all 232 EFAs after they were procured and the savings in operating costs would still allow the RAF to purchase and operate 658 F-16s. At an exchange rate of 1.5 USD to 1 GBP, the RAF could make a decision to scrap all 232 EFAs, after they were purchased, and the savings in operating costs would still allow it to purchase and operate 494 F-16s for 20 years. It should also be noted that at an exchange rate of 1 to 1 the RAF could have purchased and operated an Air Force 504 F-16s instead of purchasing and operating an Air Force of 232 EFAs.

Capability

An Air Force is effective if it has sufficient capability to successfully undertake likely contingencies and has sufficient flexibility that it can respond effectively to unforeseen events. This, rather than judgements on  “high” or “low”'technology, is what matters. Unfortunately, most recent Western aircraft deployed have been designed with a lack of concern for the factors that combat experience has repeatedly demonstrated contribute to actual effectiveness ⁸ The resulting aircraft have tended to be so expensive to develop, produce and operate that force structure and/or, operating and maintenance, and actual training have to be dramatically reduced to pay for them. This only makes sense if actual effectiveness in real operational environments is sufficiently enhanced that it offsets the resulting reductions in force structure, sustainable operational tempo, and training. Can the Eurofighter/Typhoon provide a sufficient increment in capability for its purchasers so as to compensate for the much greater procurement and operating costs?

It should be noted that there is little reason to believe that the EFA/Typhoon will be more effective than the F-16 at attacking targets on the surface, when the aircraft has been successfully equipped for this role. Simply put, any avionics or “smart”, “brilliant”, “precision” or unguided weapon that the EFA is ultimately equipped to handle the F-16 can.

Nor, is there any reason to believe that the EFA will prove to be more effective in delivering unguided ordnance, which for reasons of cost, and operational flexibility, will almost certainly be required in any significant contingency. For example, recently, the USAF in Iraq dropped 100 thousand pounds of bombs in a single relatively small operation to help disable improvised explosive devices and weapons caches (weapons costs of approximately 100 thousand dollars if unguided bombs are used vs. between 3 and 5 million USD depending upon whether 500 or 1,000 lb. JDAMs were used.)⁹. Unless, a gun is ultimately fitted to the UK version, it will be unable to strafe, thereby limiting its utility in ground attack for either attacking low value targets, such as trucks, or where collateral damage needs to be as limited as possible, and reducing flexibility and effectiveness in defence suppression. The lack of a gun will also create a vulnerability which a skilled opponent will seek to exploit in air combat.

There is little reason to believe that the EFA will be significantly more successful in dealing with ground based air defences than an equivalent vintage and fully equipped F-16 enjoying comparable support. Combat experience makes it likely that the EFA will be more susceptible to anti-aircraft guns than the F-16 both due to its greater size (making it easier to see and hit) and proportionately greater vulnerable area due to it having two engines (twin engine vulnerability)¹⁰ .

The Eurofighter website claims that the Typhoon will be highly effective in Beyond Visual Range Engagements¹¹. For example Figure 3 shows the alleged outcome of the JOUST Simulation which compared in an unspecified BVR engagement scenario the anticipated effectiveness of different aircraft performance of the EFA and other aircraft “against an upgraded Su-27 Flanker (comparable to an Su-35 Super Flanker and its equivalents)”. This indicates that in the scenarios examined that Rafale (using its standard Matra-BAe MICA) had an exchange rate of 1 to 1. The other Western aircraft examined used the AMRAAM. It also indicated that for example, the F-22 had an exchange rate of 10.1 to 1, the EFA/Typhoon had an exchange rate of 4.5 to 1, F-16C Falcon 0.3 to 1, F-15C Eagle 0.8 to 1), F-18C Hornet 0.3 to 1), and the F-18+ 0.4 to 1.

Figure 3. Source: Eurofighter Typhoon [Editor: Eurofighter have assumed the threat capability is the Su-27M, relabelled later the Su-35. This is a much less capable aircraft than the current Su-35BM/Su-35-1 in late development].

The realism of the Joust simulation and the validity of these results as a guide to actual combat effectiveness are certainly open to question. For, example, the AIMVAL/ACEVAL tests despite their having been constructed to favor aircraft equipped with BVR radar guided missiles (defending aircraft not equipped with BVR weapons were maneuvered into head on engagements with attacking aircraft that were) showed that exchange rates for the BVR aircraft dropped dramatically as the number of opposing aircraft increased¹². For example, in engagements with 1 aircraft on each side (total of 2 aircraft), “valid” engagements had an exchange rate of 3.8 to 1 in favor of the aircraft equipped with BVR radar guided missiles. However, in engagements with 4 aircraft on a side(total of 8) the exchange rate was one to one. These results were confirmed in the simulations run during the AMRAAM OUE [Editor: numerous concerns remain about the series of simulations produced to argue the Typhoon case.].

This is due in large part to degraded situation awareness as the complexity of the environment increases, the difficulty of positively identifying opposing aircraft at beyond visual range, and the inherent difficulty of actually managing a BVR AAM kill in a dynamic environment under combat conditions. For example, Figure 4, shows the generally accepted set of tasks required for a successful BVR engagement, in the event that non visual identification can be achieved with sufficiently high confidence so as to avoid unacceptable levels of fracticide. Historically, 70% of air combat kills have been made against unaware targets from behind, and for obvious reasons the aircraft with the smaller visual signature enjoys a significant advantage in visual range engagements. The reader might be forgiven for concluding that, to a casual observer it might appear that the aircraft crew focusing on the complex set of tasks required for a BVR radar missile engagement, for a sustained period of time, could hinder situation awareness and therefore prove dangerous in a multi-bogey environment.

As RV Jones, Science Adviser to the Air Ministry, proved during World War II, active IFF systems and radars have the potential to provide much more useful information to the enemy than they do to their own side, creating the risk that the user becomes a self designating target to their opponent.¹³ Likewise active countermeasures and communications systems have similar risks.

Figure 4.

Radar guided missiles are susceptible to the centroid effect as demonstrated by the continuing interest in developing and deploying towed radar decoys. A simple thought experiment helps illustrate this problem for radar guided missiles such as AMRAAM. For example, let us assume the following:

• two target aircraft with 150 meters of separation approaching head on

• the target aircraft and the launching aircraft are travelling at 0.9 Mach (300 metres/second) for a combined closing speed of 600 metres per second.

• the missile antennae is equal to the diameter of the missile which is 17.8 cm for the AMRAAM

• the radar operates at 10 gigahertz

• resolution is equal to the theoretical resolution given by the optical resolution formula and that no sophisticated signal processing or ECM is taking place

• once theoretical resolution is achieved it takes the missile 2/10 seconds to determine that there are two targets, activate the control system, overcome the moment of inertia and it then performs a constant acceleration course to the intercept.

• target aircraft maintain course and speed

• missile speed is constant at 1,000 metres per second giving a combined closing speed for the missile and target aircraft of 1,300 metres per second.

Resolution of two targets for the AMRAAM would be achieved at 890 metres. To make a kill the AMRAAM would need to pull 63 G. If the response time of the system were 1/2 second then the AMRAAM would need 829 G.¹⁴

EFA supporters claim that the EFA performance is inherently superior to other aircraft such as the F-16, Rafael, and F-15. See Figures 5-7 (Source - Eurofighter Typhoon).

Figure 5.Sustained Turn Rate: Subsonic (Source - Eurofighter Typhoon).


Figure 6. Sustained Turn Rate: Supersonic (Source - Eurofighter Typhoon).

Figure 7. Acceleration M0.9/20ft (Source - Eurofighter Typhoon).

But, it is by no means clear that the EFA is inherently more capable than all of these aircraft in actual combat conditions. For example Figure 8 shows an alternative comparison of selected parameters provided the author by a well respected analyst.¹⁵ As can be seen in this comparison, the EFA does not have superior performance for the parameters examined.

Which is the Better Air Force?

To assess which is the more capable Air Force, a simple model has been run that compares the relative effectiveness of the EFA Air Force with the six differently sized “F-16 Air Forces” shown above in Figure 2. F-16 Air Forces ranged in size from 494 (1.5USD=1GBP 232 EFA scrapped) to 1,009 (2.0 USD =1 GBP no EFA procured). Key assumptions were:

1. 25% of surviving deployable aircraft are assigned to Air Defense for each cycle of the model.

2. 25% of air defense sorties lead to an engagement provided that the number of strike aircraft are at least equal to the number of air defense aircraft.

3. If the air defense aircraft exceed the number of strike aircraft then 25% of the strike aircraft are engaged.

4. 25% of air defense engagements lead to a kill of either a strike or defending aircraft.

5. In EFA F-16 BVR engagements 12 F-16s are shot down for each EFA lost.

6. In all other engagements the exchange rate is 1 to 1.

7. 70% of EFA AD engagements against F-16 strike aircraft are BVR and 30% are within visual range.

8. 30% of F-16 AD engagements against EFA strike aircraft are BVR and 70% are within visual range.

9. All strike aircraft lost in a cycle are shot down before they reach the target.

10. The number of targets killed per strike cycle equals 25% of the strike aircraft that reach the target (this serves as a proxy for strike aircraft devoted to CAP, SEAD, aircraft forced to jettison ordnance, failure to reach the target, malfunctions of equipment, bad intelligence, and misses).

11. The minimum number of targets to be destroyed by a side in a successful campaign is 10 thousand.

12. All targets are within range of each sides strike aircraft.

13. Pilots are of equal skill.

14. Both sides have equivalent support from AWACS and GCI, Intelligence, etc.

15. Each side flies 2 cycles per day.

16. 70% of aircraft purchased are deployed in the conflict.

17. 90% of surviving deployed aircraft are launched each cycle.

18. Success in each variant is achieved by the first Air force to destroy 10 thousand targets. Except that for the 576 and 494 F-16 scenarios the scenario is terminated at 317 sorties (the maximum number required for a clear victory in the first four scenarios).

Model Results

Figure 9 summarises the results of the model pitting the 232 aircraft “EFA Air Force” against the six different “F-16 Air Forces”.

As discussed above, from a historical perspective, the assumptions are very favorable regarding the ability of the EFA Air Force to both set up and then successfully prosecute such large numbers of BVR engagements in multi-bogey environment. Both combat experience and such exercises as AIMVAL/ACEVAL and AMRAAM OEU indicate that competent opponents are less than enthusiastic at cooperating in their own destruction.

Nevertheless, as can be seen, the F-16 Air Forces in four of the scenarios (1009, 883, 757 and 658 F-16s procured) succeeded in destroying the full 10,000 target set and reducing the EFA Air Forces to future irrelevance. In two of these four cases (1,009 and 883 F-16s procured) the number of deployed F-16s surviving exceeded the number of EFAs “expected” to be procured by the RAF. In the third case (757 F-16s procured) , the number of surviving F-16s deployed (210) were only 22 less than the number of EFAs “expected” to be procured. In the fourth case (658 F-16s procured) the number of surviving F-16s deployed (132) were only 30 less than the number of EFAs deployed (162). In these four scenarios the F-16 Air Forces destroyed between 7 and 8 times the number of targets that the EFA Air Force did.

In the fifth scenario (576 F-16s procured) the EFA Air Force deployed was destroyed in toto and sufficient deployed F-16s survived (72) at the end of 317 sortie cycles that it was only a matter of time (254 additional sortie cycles or 127 days) before the full target set would have been destroyed. But, even with the scenario terminated at 317 sortie cycles the F-16 Air Force destroyed 69% of the intended target set, 5 times the number of targets destroyed by the then defunct EFA Air Force.

In the sixth scenario (494 EFAs procured) both the deployed Air Forces were rendered irrelevant after 317 sortie cycles. However, even here, the F-16 Air Force destroyed 40% of the intended target set, more than twice the number destroyed by the EFA Air Force.

Figure 9 EFA vs F-16 Air Force: Six Scenarios

As discussed above, the assumptions underpinning the model are quite favorable to the EFA. Despite this, the analysis shows that for the average exchange rate between 2 USD=1 GBP and 1.50 USD=1 GBP the UK (and other members of the EFA consortium), would have had a significantly more effective Air Force even if they purchased their full number of EFAs, took delivery and immediately scrapped them, and then replaced them with F-16s.

It should be noted that the RAF could have implemented a victorious 658 F-16 Air Force at an average exchange rate as low as 1.30 USD to 1 GBP, had it written off its investment in Typhoon R&D and cancelled the program prior to initiating production. Had such a decision been made, the resulting offset commitments that could have been extracted for the purchase of such a substantial number of F-16s, and redeployment of unused funds to other purposes, would probably have been sufficient to ensure that the benefits received would have been sufficient to outweigh any cancellation charges incurred.

It will be interesting to see what other potential purchasers, less burdened by domestic political pressures than the EFA consortium member states, will conclude regarding the relative attractiveness of the two aircraft.

Conclusions and Recommendations

The analysis discussed indicates that the Royal Air Force would find it advantageous in terms of military capability if it were to:

• scrap the EFA’s already purchased in Tranche 1 (55)

• scrap those Tranche 2 (89) EFAs for which production can not be cancelled and cancel production of the remainder

• Cancel procurement of Tranche 3 (88)

• Replace the EFAs scrapped and cancelled with an F-16 Air Force that has the same DCF.

For example, Figure 10 shows the number of F-16s that could be purchased and operated for 20 years for three average exchange rates, if it proved necessary to scrap all 89 Tranche 2 EFAs rather than terminate some or all of their production.

Figure 10.

As can be seen, in Figure 11 even at an average exchange rate of 1.5 USD to 1 GBP the Royal Air Force F-16 Air Force of 594 aircraft would be expected to be able to defeat decisively the planned 232 Royal Air Force EFA Typhoon Air force with no surviving deployed EFAs after 312 sortie cycles, 7,545 targets destroyed and 86 deployed F-16s surviving. At an exchange rate of 1.75USD to 1GBP the 692 Royal Air Force F-16 Air Force could have been expected to both annihilate the EFA Air Force and destroyed the full 10 thousand target set in 269 sortie cycles with 158 deployed aircraft surviving (4 less than the total number of EFAs deployed). The 791 F-16 Air Force (exchange rate 2USD to 1GBP) would have destroyed the UK EFA Typhoon Air Force and the full 10 thousand target set in 188 sortie cycles with 235 deployed F-16s surviving.

Figure 11 Comparative Performance EFA Air Force vs terminate EFA program and Replace With F-16s: Selected Exchange Rates.

Escalating costs and concerns about the limited tactical advantages conferred by the large scale deployment of stealth aircraft, degradation in promised performance, continuing concerns about availability and maintainability in operating units, slippage in delivery schedules, as well as rising procurement and operating costs make it desirable for a similar analysis to be conducted for the UK MOD, by an objective independent third party, regarding the JSF and its alternatives before irrevocable commitments have been made. Such an analysis could at least assist in helping ensure that the Royal Air Force was not embarked upon a path leading towards expensive unilateral disarmament.