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US Spying Costs Boeing Military Jet Deal With Brazil

An anonymous reader writes with this excerpt from a Reuters report shedding light on one consequence of increasing knowledge of the extent of U.S. government spying: "Brazil awarded a $4.5 billion contract to Saab AB on Wednesday to replace its aging fleet of fighter jets, a surprise coup for the Swedish company after news of U.S. spying on Brazilians helped derail Boeing's chances for the deal. ... The timing of the announcement, after more than a decade of off-and-on negotiations, appeared to catch the companies involved by surprise. Even Juniti Saito, Brazil's top air force commander, said on Wednesday that he only heard of the decision a day earlier in a meeting with President Dilma Rousseff. Until earlier this year, Boeing's F/A-18 Super Hornet had been considered the front runner. But revelations of spying by the U.S. National Security Agency in Brazil, including personal communication by Rousseff, led Brazil to believe it could not trust a U.S. company."

19 of 439 comments (clear)

  1. Boohoo by Anonymous Coward · · Score: 5, Insightful

    Seems fair. The US government does the same to Chinese companies for the same reason.

    1. Re:Boohoo by Nemesisghost · · Score: 5, Insightful

      But the US people will pay again for the arrogance of the government.

      I, like the vast majority of the US, am neither a shareholder nor employee of Boeing. Explain to me how this costs me a lot of money.

      You pay in a couple of ways. This hurts our entire economy. So any stocks you own(of which most retirement accounts are made up of) will lose value. There's the entire supply line that is now impacted, so further damage has been done(why else did so many support the auto bailout). You lose in that this lack of trust in one company means that the world might not trust another in which you are directly involved with, which will cost you. Don't think that a major country's petty BS that leads to them cancelling negotiations with a US company won't hurt you just because you have no vested interest in that company. The ripples are far bigger than you might think.

    2. Re:Boohoo by houstonbofh · · Score: 5, Insightful

      So when Boeing and it's suppliers lay thousands of people off, those unemployment benefits came from magic pixie faeries? And the money they no longer spend with your business has no effect on you? Just look to Michigan to see what happens in a state when major factories close. (Or Trenton, for that matter.)

    3. Re:Boohoo by macpacheco · · Score: 5, Informative

      The Super Hornet was never the favorite of the Brazilian Air Force.
      Unlike other serious govts in the world, here we had the favorite of the Air Force and the favorite of the president.
      It was the favorite of the Air Force because:
          - Lower cost both procurement and operational costs (I could joke there my Brazil don't have an air force, instead it has an air farce)
          - better air to air performance (let's face it, Brazil hasn't had a single bomb dropped in a military operation since WWII, what we need is air defense, the Super Hornet excels at being a bomb truck, even US Army Hornet pilots have admitted the SH leaves something to be left desired against even a much older Mig29 in a dog fight)
          - Generation 2 AESA radar with full technology transfer
          - Full technology transfer on the aircraft itself
          - Local manufacturing of most aircraft under license
          - Prospect of a partnership in future Gripen upgrades, Embraer will be the Brazilian partner on this, they have a world class track record on military and civilian aircraft sales, which dwarfs SAAB experience with exporting aircraft
          - You see, Boeing x Embraer would never be a really good partnership, Boeing is a competitor of Embraer in many markets (my forecast is Embratel will eventually produce a 737 sized aircraft, then they would become a full fledged competitor, but even the E-jets compete with 737 despite of the size difference)
          - The only advantage the SH had was it could be used on our single aircraft carrier, that stays in port the vast majority of the time

      The espionage scandal was just a good excuse to get back to basics and do the right thing.
      Buying the SH would have been a bad economic decision anyways.
      Brazil needs cheap military hardware, no F35's for us, ever. Even the SH would be too expensive in the long run (twin engine, part costs, fuel consumption)

      Realize the Brazil is operating F-5E, Mirage 2000, subsonic AMX, all aircraft that are cheap to operate.

  2. About time by toutankh · · Score: 5, Insightful

    It's about time something like that happened. Now if only all European countries showed the same level of responsibility, maybe the USA would learn to treat their "friends" better.

    1. Re:About time by Anonymous Coward · · Score: 5, Insightful

      By that logic, we should never punish people for crimes because they will only get better at committing them.

    2. Re:About time by SirGarlon · · Score: 5, Interesting

      At this point, I think it's inevitable that spying will be a central issue in the 2016 Presidential election, and neither party will dare to defend the status quo. Corporate campaign donors are starting to see the economic implications, and they'll be raising a hell of a fuss by the time two more years have gone by.

      --
      [Sir Garlon] is the marvellest knight that is now living, for he destroyeth many good knights, for he goeth invisible.
    3. Re:About time by Anonymous Coward · · Score: 5, Insightful

      BRIC isn't the threat. The threat is multinational corporations aiming for short-term profit. And that's not only a US threat, that's what is going to collapse the world economy.

  3. Probably more to it by rossdee · · Score: 5, Insightful

    Maybe the Saab is a better deal anyway, their latest plane is a newer design, and more agile.

  4. Aircraft facts by Anonymous Coward · · Score: 5, Informative

    Just for info : they have decided for the better plane.
    The JAS SuperGrippen (Grippen NG) has a much larger ferry and combat range (twice as much as the F/A18), is a lot faster (Mach 2.2, even faster than the F35), more agile AND cheaper both in initial costs and per flight hour. It's comparable to the Eurofighter. Except that the JAS 39 NG has the much better radar.
    It has a bit lower weapon payload, though (5.3 metric ton (JAS39) vs 6 metric ton (F/A18)). But for the cost of one american plane, you can buy two JAS39 and thus have air superiority.

  5. Sanctions have started. by tekrat · · Score: 5, Insightful

    The USA will eventually find itself alone, and without allies. And it's not just the spying, it's the drone attacks on soil with countries we are not at war with. Recently we blew up a wedding party in Yemen, killing over 13 which I'm sure included women and children. But oh no, we're not evil. We're the good guys. Uh huh.

    Little by little, we are making enemies of the world, and until we change our ways, less and les of the world is going to want to do business with us because we have shown we're not trustworthy.

    And to the poster who blames a 4.5 billion dollar loss on the economy to Ed Snowden, screw you. All Snowden did was CONFIRM what everyone knew already, but just couldn't prove. He will be shown to be a hero, this decade's Cindy Sheehan.

    We are in the wrong, but people who wrap themselves in the flag are unwilling to admit it. And until we learn to act a little more humble, we're going to see more of this. We're making the typical over-exaggerated gestures of a failed empire. And as things get worse here, we're trying to take the rest of the world down with us.

    --
    If telephones are outlawed, then only outlaws will have telephones.
  6. This is not about spying or the best technology by Anonymous Coward · · Score: 5, Insightful

    This is not just a response to the NSA leaks. Everyone spies, we all know that.

    The problem is American exceptionalism. No, not because we think that (every nation does), but because we can't shut up about it. The image we project is of spoiled kids, arrogant and rotten to the core. We shove our defensiveness in everyone's faces, and that makes America a very bad salesperson. We are the tight-ass at Macy's who thinks his feces doesn't stink, and won't even pay you any attention because you have the wrong shoes. No on wants to deal with that.

    This isn't about who has the best warplanes. This is diplomacy. This is business. This is about saving face and national egos. It's about time we learned a little finesse in this area. It's something the Chinese do exceptionally well.

  7. Re:Yay! by gl4ss · · Score: 5, Insightful

    gripen isn't shit and it has the cheapest TOC of jets of it's class apparently.

    the engine is general electric and it can use weapons from all providers. it also has the modern radar now that usa stopped playing games with it as well.

    it might fit their use profile better than the super hornets anyways... probably better for shitty airstrips and improvised runways too(assumption in nordic countries is that in case of conflict all the airbase runways are bombed within half an hour or so.. that's why finland and sweden is littered with suitable road straights).

    it is a bit of a vendetta, in the sense that they had been in talks and considerations to buy the jets for almost a decade. maybe they just couldn't make up their mind who to buy from - now the decision was put on their lap. it's also likely that a sizeable chunk of the spying was targeted exactly to make the boeing deal happen!

    mind you, usa has bought plenty of weapons from sweden as well. perhaps the swedes were more willing to share firmware to the planes too(basically a country is stupid to buy jets if not, finnish non-super hornets have had considerable firmware modifications in finland too..).

    --
    world was created 5 seconds before this post as it is.
  8. Re:This is only one tree in a big forest by Anonymous Coward · · Score: 5, Informative

    I live in Brazil and you couln't be more wrong. We have a consolidated democracy and will elect a new president in 2014 (and governors), it's that simple. Yes, we do have a massive income distribution program, but it's not used politically as much as it have could been.

  9. Re:This is only one tree in a big forest by Luckyo · · Score: 5, Insightful

    The main source of despots in Latin America has been US, which used despots to keep countries in severe poverty while it's multinationals shipped profits to US.

    "Bolivarian socialism" has evolved to prevent this exploitation, and succeeded in increasing quality of life in the region significantly. Obviously at the cost of profits for multinationals.

  10. Re:Official flight test results (Re:Aircraft facts by Shinobi · · Score: 5, Interesting

    Ah yes, that report, written by Dassault themselves, even in the face of Gripen curbstomping Rafale in red flag excercises, and Gripen proving that it was better at strike missions in Libya.

    Basically, Dassault has such a foothold in the Swiss Air Force that they can write the requirements and testing specs to favour Dassault. It's like trying to sell Gripen or Typhoon to the US or Russian Air Forces.....

  11. Better Headline by Anonymous Coward · · Score: 5, Funny

    US Spying Costs Boeing a Brazilian Dollars

  12. Re:Political theater by Henriok · · Score: 5, Interesting

    The fact that the military didn't even know about this snap-decision

    The decision might seem sudden but Brasil have already chose Gripen in several occasions during the last 10 years. Those decisions have been interrupted by sudden economic downturn, and corruption, political instability and other stuff. Gripen seems to have been favored by the Brasilian military and Industry all these years though, and since all competitors are eliminated du to various reasons (technical, political, corruption, cost), there was no reason not to take the decision now.

    --

    - Henrik

    - when the Shadows descend -
  13. Re:No No! Re:Boohoo by Anonymous Coward · · Score: 5, Funny

    Amongst our many groups are such diverse elements as those who know how to count, those who don't, those with a ruthless dedidcation to the pope and ... I'll come in again.