PARIS --- While fast jets invariably attract most attention, the trade war being fought over the medium military transport market is possibly even more intense, as only two players dominate this market. Both are European, both are subsidiaries of larger aerospace and defense groups, and both offer upgraded versions of old designs.
In one corner sits the Airbus Military C-295, the latest variant of an aircraft that began life in the 1970s as a joint Indonesian-Spanish venture, the Casa-Nurtanio C-235, to tap the market for a twin turboprop utility transport mainly intended for operation in South East Asia and Europe. To reduce costs, the CN-235 was designed mostly to commercial aircraft standards, with some military features; the C-295 is a much-improved and more capable version developed by Airbus Military.
In the opposite corner sits the Alenia Aermacchi C-27J Spartan, the latest variant of the Fiat (subsequently Aeritalia) G-222, a tactical airlifter developed for the Italian air force which required a high performance aircraft capable of carrying loads at high altitudes, over the Alps and Apennines. The C-27J is the latest version, developed jointly with Lockheed, and shares several features, including avionics and engines, with the C-130J Hercules.
These two aircraft compete for most medium military transport contracts world-wide, as there is no other real alternative since Antonov lost credibility and De Havilland Canada went out of business. Alenia Aermacchi says its C-27J Spartan has attracted 74 orders to date, while Airbus Military claims 100 orders for the C-295.
A recent contract in Peru, which finally bought two C-27Js, offers an opportunity to see how the two aircraft line up on the market, although given the country’s geography offers a particularly difficult operational environment this case cannot simply be transposed to other countries.
The Peruvian case
The Peruvian air force needed to replace the Antonov AN-32Bs that it bought in 1994 to replace older AN-26s that had proved so underpowered that they caused several fatal crashes while operating from high-altitude airfields.
Although it was asked to propose its latest AN-32RE, Antonov did not file an offer, Peru’s defense ministry said in a Nov. 29 statement, thus leaving the field to Airbus Military and Alenia Aermacchi. Local press reports claim that Antonov offered to set up an AN-26 assembly line in Peru, which is hardly consistent with its not bidding for the contract, but it appears in fact that Antonov’ offer was made for its AN-158 regional jet, which the company is offering to Peru as a replacement for civil AN-26s.
After a three-year bureaucratic process, Peru in November decided to buy the C-27J, and signed a contract worth $122 million for two aircraft and a large support package.
According to the Peruvian air force, this represents a saving of $12 million over Alenia’s initial offer of $134 million and, combined with the C-27J’s superior hot-and-high performance, this was largely sufficient to warrant its selection.
The sale attracted immediate criticism, however, and questions were raised regarding both the price and the performance of the C-27J. Moreover, Airbus Military has reportedly decided to contest the contract, and sees allegations that its C-295 failed to meet nine of the technical requirements as proof that the tender was distorted in favor of its competitor.
Critics of the C-27J deal make much of July 2010 report by a committee chaired by the commander of the air force’s 2nd Air Wing, and which recommended buying ten C-295s for “its efficiency and effectiveness for coastal and jungle operations” and lower costs. The report, quoted by local website GatoEncerrado.net, says that the support costs of the C-27J are much higher that its competitor (the C-295’s are 34% cheaper, it claims).
The C-27J is reported to need 400 gallons of fuel per flight hour, compared to 199 gallons for the C-295, and this contributes to the C-27J’s flight hour cost of US$2,542 compared to US$1,750 for the C-295. The report concluded that the C-295 has a mission effectiveness ratio of 86.1%, compared to the C-27J’s ratio of 76.1%.
It should be noted, however, that this report only considered coastal and jungle operations, and apparently ignored high-altitude mountain missions, which are crucial for Peru and where the C-27J’s engine power guarantees a wide safety margin.
Variable prices raise questions
Other questions revolve around the C-27J’s price. The Peruvian contract values each aircraft at $61 million (44.9 million euros), including a large support package. But in 2012, Alenia reportedly offered to sell a ground support version of the C-12J to Peru’s National Police for 34 million euros – fully 11 million euros less. Local press reports comment that it is unreasonable for the price to have increased by one-third in just one year.
C-27J pricing had also attracted attention in Australia. In May 2012, when it announced that it was buying ten C-27Js, the Australian government said the contract would cost A$1.4 billion, including support and the added cost of buying the airplanes through the US Foreign Military Sales process.
At the time Airbus Military said its offer of ten C-295 aircraft, which “is cheaper to buy and operate than the C-27J,” was priced at A$400 million, and “would have provided savings of $1 billion compared to the C-27J FMS.”
Alenia also said its part of the Australian deal was worth only €800 million -- €80 million, or about US$104 million, per aircraft – but this is roughly double what Peru is paying.
At the time, the Australian defense department had commented that “Items fitted to the C-27J such as secure communication, navigation and surveillance equipment, encryption equipment and aircraft self-protection systems are supplied by the United States Government and are not shown in commercial valuations” to justify the contract’s high cost.
In Peru, claims also have surfaced that technical formed by air force, army and navy personnel recommended the purchase of the C-295. This sparked some public interest, and prompted the Peruvian Ministry of Defense to issue its long Nov. 29 statement retracing the tender’s history and explaining why it had chosen the C-27J.
In addition to the $12 million savings, the statement points out that the C-27J’s engines are powerful enough – rated at 4,627 shp each - to keep the aircraft flying at high altitudes even if it loses one engine. The C-295’s engines, it says, are only rated at 2,645 shp - even less than the original AN-26As that suffered many high-altitude accidents.
Other relative advantages have also been mentioned in this or in other competitions, notably in Australia, where its larger fuselage, loading ramp, and capacity to carry military-standard cargo containers allowed it to carry the day.
Quoting letters, names and dates, the GatoEncerrado website also mentions a possible argument in favor of the C-27J: Alenia Aermacchi’s promise that its corporate sister, Finmeccanica unit Whitehead Alenia Sistemi Subacquei (WASS), would drop its legal suit against the Peruvian government over the non-payment for ten torpedoes in exchange for the C-27J order.
Ironically, if true this promise was not even necessary, as in March 2012 a tribunal in Livorno, Italy, ruled in Peru’s favor, saying that WASS had no cause for claiming any payments.
An inconclusive conclusion?
In the final analysis, there is no clear winner between these two very different aircraft, as each is tailored to a specific set of mission requirements with comparatively little overlap. As such, they only really compete for acquisition budgets, but this is no doubt the most cut-throat criterion of all in these times of budget constraints.
Both aircraft have advantages and drawbacks. Designed to a military requirement for tactical transport, the C-27J is adapted to military loads and missions, offers more power and higher performance, but costs more to procure and to operate. It also has unique capabilities in this market niche, such as low-altitude parachute extraction, the capacity to carry larger military-standard pallets, and in-flight refueling.
The C-295, on the other hand, can carry more passengers in a narrower if longer cabin (which it claims is the longest unobstructed cabin of its class) that cannot take all the standard military containers and can only carry very small vehicles. It has a longer range, both military and civil certifications, and its civil origins are reflected in its lower acquisition and operating costs. If the Peruvian figures quoted above are right, the C-295 costs half as much to buy, and about one-third less to operate, than the C-27J.
The words of an Australian officer as the time of the RAAF order offer a fair summing up of the competitive situation: “The C-27J was chosen over the arguably less capable - but cheaper - Airbus C-295.”