Chapter 535: Competitors
The advent of the JF-30 has given hope to all countries that want to get a fourth-generation fighter, but cannot buy the F-35A, and also gives some countries that can buy the F-35A, but are not very satisfied with its performance, a choice, and the key is actually time.
How long will it take for the JF-30 to reach mass production and be delivered to buyers?
In other words, how long will it take for the Huaxia aircraft factory to complete the design and flight test work of the JF-30 and bring it to mass production and equipping status?
Five years!
This is the time that can be gained the most.
Although affected by the development progress, the first few batches of the F-35A have no actual combat capability, and the cost of later upgrades is extremely high, so it was not until 2019 that Loma began to deliver F-35A with actual combat capability to foreign customers, and all the F-35A delivered before could only be used as training aircraft, but with the start of Loma's pulsating production line, the annual production of F-35A has increased rapidly, and it has reached 350 in 2022. It is expected to increase by about 20 percent in 2023 to more than 400 aircraft.
At this rate, by 2026, Loma will deliver more than 2,000 F-35As, of which 600 to 800 will be delivered to overseas users.
What is this concept?
Excluding the United Kingdom, Japan, Italy and other countries that have introduced F-35 production lines, more than a dozen countries that need to buy F-35A directly from Loma will have a total demand of between 1,000 and 1,200 aircraft, and it is likely to be less, after all, imported fighters are too expensive.
The most typical is Canada, which has abandoned the F-35A in favor of the F/A-18E/F.
It can be seen that as long as Loma is at full capacity, it will be able to occupy all overseas markets in 2027 or 2028 to meet the needs of most countries for F-35A.
How much of the market is left for the JF-30?
What's more, after the production capacity of the F-35A is increased, it is very likely that the United States will ease export restrictions and sell this fighter to more countries.
Among them, the most representative is Saudi Arabia.
The United States has not sold F-35A to Saudi Arabia for the time being, firstly, for the sake of Israel, after all, the United States is Israel's hardcore, and secondly, the production capacity is insufficient.
Even the main allies cannot be satisfied, and the United States naturally does not consider secondary allies.
Although Saudi Arabia is a major ally of the United States in the Gulf region, it can be regarded as a secondary ally of the United States at best.
In addition, Loma has been improving the F-35A.
The latest batch of F-35A, which has been upgraded in many subsystems, is much more powerful than the first batch of combat-capable F-35A.
As the F-35A's performance gradually increases, the export restrictions it is subject to will also decrease.
To put it simply, the United States can provide Israel with the latest F-35A, or upgrade Israel's F-35A, while selling slightly inferior F-35A to Saudi Arabia and other Arab countries, so as to ensure Israel's military superiority and prevent Arab countries from posing a threat to it.
Of course, the most critical thing is still the manufacturing cost, that is, the ex-factory price.
By 2022, the ex-factory cost price of the F-35A purchased by the U.S. Air Force has dropped to $120 million, which is slightly lower than the original requirement of $85 million per unit price according to the 2016 currency system, after adjusting for inflation.
As for export prices, they are also decreasing at the same time.
As the export price of the F-35A decreases, there will certainly be more countries that will choose the F-35A instead of waiting for the JF-30, which is not necessarily cheaper at the time of mass production.
In fact, this is also the key to India's abandonment of the Su-57 and its switch to the F-35A.
It's just that the Indians think a little too much.
That is, not only to buy the production line and patent authorization of the F-35A, but also to reduce the exit price to the same extent as the United States after the realization of domestic production, that is, according to the currency system in 2022, the unit price will not be higher than 120 million US dollars, so as to save tens of billions of US dollars.
Is there such a good thing?
Why is it that the U.S. military can get the ex-factory price, while the purchase price of other countries is much higher?
To put it bluntly, Loma had to earn back a huge amount of research and development costs through exports, and a large part of it had to be returned to the U.S. military.
Why?
Almost all of the tens of billions of dollars spent on the development of the F-35 came from US defense appropriations, and the US military paid for Loma to complete the development.
In other words, the intellectual property rights of the F-35 are actually in the hands of the U.S. military, not Loma.
With intellectual property rights, the U.S. military will naturally be able to buy the ex-factory price.
What does India have?
If India can get the same ex-factory price as the US military, what will those countries that have invested in the development of the F-35 and the purchase price is much higher?
After waiting for more than a decade, when the United States initiates the joint development of the next generation of fighters, who else will participate?
To put it bluntly, if India buys enough quantities, then the United States may give India a wholesale price, which is slightly cheaper than that of other countries.
As for getting the ex-factory cost price, it is obviously impossible.
Of course, yield is crucial.
According to estimates, by 2025, that is, after the production exceeded 1,500 aircraft, the F-35 has reached the break-even point, that is, the capital has been guaranteed.
Well, from 2026, the money earned from the sale of the F-35 will be a pure profit.
Based on this, it is speculated that after 2026, the export price of the basic F-35A is likely to drop to $150 million, and at most no more than $170 million.
Even if the full system is included, the unit price of purchasing 60 aircraft will not exceed $220 million.
At this price, it is definitely cheap.
You know, in 2016, India purchased France's Rafale, including a complete set of systems and ammunition, at a unit price of more than $200 million.
What's more, the Rafale is not comparable to the F-35A at all.
If Loma can keep the F-35A's system-wide price at around $200 million, then all the advanced fighters available today are no match for it.
Why is it so low?
To put it bluntly, it's the yield.
By 2026, the total production of F-35s, including the F-35B and F-35C, will be close to 3,000 aircraft, and it will definitely exceed 5,000 by 2030.
Such a huge output can reduce the apportionment of research and development expenses to an almost negligible level.
Why?
In order to develop the F-35, a total of less than 50 billion US dollars was spent, even if inflation is counted, according to the currency system in 2030, it will be about 150 billion, and if it is distributed to 5,000 fighters, the average development cost of one is only 30 million US dollars.
If compared with the selling price of 200 million, the development cost of 30 million is only 15%.
For fourth-generation fighters, this proportion is already very low.
You know, the F-22A is more than 35%.
As for the Russian Su-57, if calculated according to the target production of 200 aircraft, the proportion of research and development funds will even exceed 50%.
Even Huaxia's J-20, based on the maximum target production of 600 aircraft, has reached 25%.
It can be seen that the cost advantage brought by this scale effect is enough for the F-35A to crush all competitors with a price war in the international fighter market.