High Cost of US weapon systems- for instance Harpoons?

[Raj Malhotra]

High Cost of US weapon systems- for instance Harpoons?


One of the reasons to purchase the weapon systems from US and that also under FMS is that we get them at US Govt purchase price (give or take a few %). Further as US is producer for huge amount of military equipment, these systems are not only sophisticated but also cheaper. Now the funny thing is that most of the systems being purchased "seem" very costly. There are also doubts whether there are any offsets being given by US sellers prescribed under DPP and if there is any effective technology transfer. So what gives? Some examples:-

Harpoon Sold recently to Pakistan for US$2 million a pop goes upto US$ 7 million for us.
C-17 goes up from US$ 200-250 million dollars to US$ 500-550 million
M777 goes up from US$2 million to US$ 6 million a piece etc etc

 

[Yusuf]

there is a difference between unit cost and also cost that India would pay for the entire gamut including weapons, training, logistics etc for different systems. US products are never cheap though.

 

[arps]

High Cost of US weapon systems- for instance Harpoons?


One of the reasons to purchase the weapon systems from US and that also under FMS is that we get them at US Govt purchase price (give or take a few %). Further as US is producer for huge amount of military equipment, these systems are not only sophisticated but also cheaper. Now the funny thing is that most of the systems being purchased "seem" very costly. There are also doubts whether there are any offsets being given by US sellers prescribed under DPP and if there is any effective technology transfer. So what gives? Some examples:-

Harpoon Sold recently to Pakistan for US$2 million a pop goes upto US$ 7 million for us.
C-17 goes up from US$ 200-250 million dollars to US$ 500-550 million
M777 goes up from US$2 million to US$ 6 million a piece etc etc

I feel also Harpoon is much costly.But u cant compare with pakisthan, as ours are for Jaguars not for ships(which can be cheaper much).

 

[prateikf]

..:: India Strategic ::.. Defence Industry: India will pay 3.8 percent on all FMS deals with US

this is exactly the commission paid to sales agents that people frothed in the mouth about and blacklisted many. only in this case the GOVT ofUS itself is the dalal and arbiter! so it gets paid extra acting as sales agent for its own weapons industry and recycles part of this to willing politicians in buyer countries. wow.

Would have been comic if it wasn't tragic. If only this commonsense of keeping a commision openly was used in other deals, we would have had the 155mm in loads and the Bhim would been roaming the Indian plains... But today we are without any modern artillery with china and pak crawling all over

 

[LETHALFORCE]

If these inflated prices were accepted by Indian Govt then it is not USA's fault. It seems like Indian govt is inflating the prices and pocketing the difference.

 

[Yusuf]

LF, you know its not possible in such deals. FMS rates are the rates at which the US forces buys weapons system and the US govt takes a commission for its expenses. If we were to negotiate for those weapons directly with manufacturers they would add their high margins on it and then india would pay even more for it.

 

[LETHALFORCE]

LF, you know its not possible in such deals. FMS rates are the rates at which the US forces buys weapons system and the US govt takes a commission for its expenses. If we were to negotiate for those weapons directly with manufacturers they would add their high margins on it and then india would pay even more for it.

Yusuf every American weapons deal is overpriced by 50% and the stringent terms that go along with it, there must be other alternatives to these weapons.

 

[Yusuf]

All purchases will have to be viewed in perspective, what the terms of the deal are. Training, logistics, maintainence etc... The US has to bother just about unit cost as everything else is in place. Plus the west is usually transparent in deals and their pricing is known.

 

[LETHALFORCE]

This is the prices we will pay until our indigenous efforts start bearing fruit.

 

[Raj Malhotra]

The explanation that there is entire gamut including weapons, training, logistics etc for different systems to be paid for seems a non-starter as other nations will purchase the package. Further Pakistan also bought botht the air launched and ship launched missiles. Further price differential is more obvious if you google for other deals with numerous other nations. Now look at

US$ 1 Billion for "only" 6 C-130s. Compare it with US$ 50 million for a Il-76, it means that C-130 is 6 times more costly than an aircraft twice its size. If there are some special systems makes all these systems so costly then what are those?

 

[LETHALFORCE]

look at the C-17 deal and the big price difference in that for India, what is being offered for such a large difference???

 

[Daredevil]

The explanation that there is entire gamut including weapons, training, logistics etc for different systems to be paid for seems a non-starter as other nations will purchase the package. Further Pakistan also bought botht the air launched and ship launched missiles. Further price differential is more obvious if you google for other deals with numerous other nations. Now look at

US$ 1 Billion for "only" 6 C-130s. Compare it with US$ 50 million for a Il-76, it means that C-130 is 6 times more costly than an aircraft twice its size. If there are some special systems makes all these systems so costly then what are those?

I don't know where you got the news of $ 1 Billion for 6 C-130s. According to various reports it is $596 million for 6 C-130s. It is more like 100 million per plane.

Lockheed Martin in $596 mln Deal for India C-130 work

 

[Kunal Biswas]

1 pak fa = 100 million

 

[plugwater]

1 pak fa = 100 million

Kunal sir you still believe we will get Pakfa for 100 million ? We paid more than 100 million even for Su-30. Russian weapons are not so cheap anymore.

 

[SATISH]

The explanation that there is entire gamut including weapons, training, logistics etc for different systems to be paid for seems a non-starter as other nations will purchase the package. Further Pakistan also bought botht the air launched and ship launched missiles. Further price differential is more obvious if you google for other deals with numerous other nations. Now look at

US$ 1 Billion for "only" 6 C-130s. Compare it with US$ 50 million for a Il-76, it means that C-130 is 6 times more costly than an aircraft twice its size. If there are some special systems makes all these systems so costly then what are those?

All you know is that? C'mon, you need to take into consideration the spares bought, infrastructure, pilot training, support, and everything into consideration. And above all it is not produced in India. Hence the huge labour cost. You need to know why the Americans and the Europeans are keen to enter Indian production lines. It is because of low labour costs here. An F 18 built in US costs $80 mil a peice but the same built in India costs $ 50 mil a peice.

 

[SATISH]

1 pak fa = 100 million

I disagree with that sir. I think a PAK-FA will cost $200 mil a peice and FGFA will be atleast $150 mil a peice.

 

[Kunal Biswas]

I disagree with that sir. I think a PAK-FA will cost $200 mil a peice and FGFA will be atleast $150 mil a peice.

I saw on wiki..
Any link on this..

 

[SATISH]

I saw on wiki..
Any link on this..

No Kunal sir. I dont have links. But my assessment for the production costs and the weapons developed for the PAK FA is way over-kill for one peice to cost $100mil in the start. It might cost more sir. But $100 mil is almost impossible.

 

[JHA]

$100 Mil is just for plane..Other goodies will cost extra...And if Pak-Fa costs $200 mil. then i must say i am a little tempted towards F-35...

 

[Agantrope]

I saw on wiki..
Any link on this..

Sir, Project is just in initial stages, we are yet to see any cost escalation issues and all. Surely it will be more than $100M. JSF was propagated as $35M flight but now $165M