Italy feels its workshare in JSF does not reflect the country's $1bn investment in development
Adm Giampaolo Di Paola, secretary-general of Italy's procurement agency, the defence/national armaments directorate, leaves no doubt that he wants to improve Italy's JSF position.
He says "tough negotiations" with Lockheed Martin and the US government continue, but adds: "We're in the programme, full stop, and we're at the top of the Level 2 partners. We wouldn't have entered that level of investment without a clear prospect of proceeding into the production phase."
But underlying the talks, Di Paola concedes, is concern over Italy's JSF workshare, both in the system development and demonstration (SDD) and production phases. "Naturally, there is a lot of expectation with a programme like this, and we want to ensure the return for our industry reflects fully our level of investment and technological ability. We've been working hard to establish that," he says.
Carlo Festucci, secretary-general of the Italian aerospace industry association, the AIAD, complains that the Netherlands has received more work even though it has paid less than Italy's $1 billion investment in SDD - he calculates the difference in contribution at around $800 million.
Di Paola says it was "more difficult in the beginning" to establish Italy's industrial credibility in the programme, "but it has got easier. Alenia and others are world-class companies capable of taking this work and doing an excellent job." He has long experience of working with the US military-industrial establishment, and a reputation as a tough negotiator, giving the clear impression that the battle to improve Italy's position in the JSF programme is very much ongoing. But he believes "the longer term will prove the investment worthwhile".
High on Italy's priorities for improving its industrial return is establishing a second JSF production line. Festucci says: "We definitely need a production line for the Italian aircraft - and maybe for the European aircraft as well." He concedes that it would "cost a lot of money", but that the pay-off in terms of providing logistics support for European and perhaps US aircraft based in Europe would make it worthwhile.
Second lineDi Paola approaches the second line concept with an open mind, aware that the economic case for it has yet to be demonstrated. "In principle, we do not dislike the idea of our own production line - but we must ask if can we afford it. It's a question of what we can achieve. All I can say is that there are discussions and there will be a decision in a few years."
According to Lockheed Martin JSF programme manager, Tom Burbage, there are "no potential show stoppers" if Italy or another partner want to set up a production line. Such a move would, however, change the economies of scale upon which programme expenditure is based, and the partner "would have to pay the extra costs associated with that".
Underlying Italian interest in setting up their own production facility is a requirement for at least 100 JSFs - possibly more - to replace Alenia/Aermacchi/Embraer AMXs, Boeing/BAE Systems AV-8B Harrier IIs and Panavia Tornados operated by the Italian navy and air force. Di Paola declines to be drawn on precise numbers: "We haven't decided yet." The only clear requirement, he says, is that aircraft must be available "in the 2015 timescale".
Italy entered the JSF programme in June last year with an investment of $1.02 billion, to be spent from 2002-12. Airframe and systems work accounts for around 80% of the total, the engine the remainder.
Di Paola and Festucci point out that in terms of entry fee and potential requirement, Italy is the largest of the Level 2 partners. Its ability to secure a strong place in the international workshare was compromised, however, by its late arrival on the JSF programme, when many of the opportunities for major involvement had already been taken up by other partners.
The wins thus far have been for the most part second sourcing contracts, dominated by Alenia, supplying wing sets, and Marconi Selenia Communications, providing back-up radios.
However, Marconi Sirio Panel has secured orders in its own right for JSF instrument panel and lighting work, and Piaggio Aero for machined components. Avio has also secured an agreement with General Electric for a 5% stake in the F136 alternate engine, for which it will supply the low-pressure turbine.
Avio is also negotiating with Rolls-Royce to be main subcontractor on the STOVL version lift-fan gearbox, with responsibility for design, development and manufacture during SDD. Avio hopes this will extend to the production phase, and feels itself "well placed", says Salvatore.
Alenia already has around 50 engineers embedded in the JSF programme at Fort Worth, Texas, and plans to increase this to 100 as the programme phase progresses into low-rate initial production (LRIP). Its role in producing F-35 wing sets was announced in June last year, when Italy formally joined the SDD phase.
The agreement with Lockheed Martin envisages second-source wing production for all Italian air force and navy aircraft, plus 50% of those for the UK and the USA, also stipulating that Alenia must produce wings at the same or lower cost than those manufactured by Lockheed Martin.
Michael Cosentino, JSF international programmes director, says that Alenia has already been tapped to supply every fifth wing for the programme in the LRIP phase. He points out that "any US company being offered the chance to build every fifth wing in a 4,000-aircraft programme would be jumping to get aboard".
Alenia will produce its first wings for the third JSF LRIP batch, due at the end of 2009. The overall LRIP order comprises around 480 aircraft, for which Alenia will supply 83 wing sets. When full-rate production begins, in 2014, the company expects to build around the same number as Lockheed Martin, turning out 2.4 wing sets a week. Burbage says the arrangement means Alenia faces a potentially enormous return once full-scale JSF manufacture gets under way.
Alenia's wing experience dates from its work on Tornado, and on the Eurofighter.
The JSF metal/composite wing was seen as a comfortable fit with its industrial capabilities, particularly its composites facility at Foggia and metal machining plant at Nola, in the south of the country. Alenia wants to use JSF to build on the capabilities of both, particularly through the introduction of composite fibre placement techniques which, although established in the USA, have not formed part of any Alenia programme to date.
The company says there is potential to outsource some of the machining work to other Italian manufacturers if the production rate exceeds four or five wing sets a month. It would retain the fibre placement technology in house, however, "because composites technology is very difficult to outsource", it says.
Investment concernsFestucci believes that, while Alenia has done "quite well" so far, his organisation remains concerned about the returns for other Italian companies to justify Italy's investment. "I'm not particularly happy. We expected 60-70% offset and we're not there yet." He believes the US government and industry is reneging somewhat on the degree of Italian industry involvement expressed earlier in the programme and says problems have arisen with the USA's "Buy American" provisions that mean a company like Galileo, which hopes to secure avionics business, has to tie up with a US counterpart to be able to compete.
Italy is nearing a point, he adds, where "we have to decide how much we should put into a programme that has no guarantee of a proper return for our industry". He even says that buying JSF directly might be less expensive in the longer term than pumping money into a programme that may not provide the technology input for Italian industry to make the investment worthwhile. "If we continue in this way, it could finish the European aerospace sector. Offsets must be direct. We don't want some indirect offset that benefits another industry. That wouldn't be good for us at all."
Festucci is also a pragmatist, however. He says Italian firms "should see some progress" by the end of 2003 as a result of talks between the Italian and US governments, as well as with Lockheed Martin.
Source: Flight International
