Eurofighter battling for foreign sales: program officials admit it's an uphill struggle in international markets.

• Author: Tiron, Roxana
• Position: Analysis

The much-maligned Eurofighter program must lower costs and prove that it can compete effectively against U.S. platforms, to regain credibility in the world markets, experts said. Eurofighter officials noted they are optimistic about prospects of new foreign sales, but nevertheless acknowledge that the competition is tougher than ever.

The Eurofighter funding partners--Britain, Germany, Italy and Spain--signed an agreement in 1998, committing themselves to buying 620 aircraft. The development cost for the airplane was estimated at $10 billion. In order to make it more marketable outside Europe, the fighter jet was also named the Typhoon.

The Eurofighter headquarters is in Munich. The program is owned and managed by a consortium of European firms--BAE Systems, of the United Kingdom; Alenia Aerospazio, of Italy; EADS, of Germany and EADS Spain (formerly CASA).

The Eurofighter's largest customer, the U.K. Royal Air Force, is slated to deploy its first Eurofighter squadron in 2005. The United Kingdom's original order was for 232 airplanes, with options for 65 more.

But observers now are questioning whether the four main partners will stick to their initial commitments, given the cost overruns and delays experienced in the program. Speculation among industry circles is that the U.K. order will be downsized to 150 aircraft.

Further, both the U.K. and the Italian defense ministries have made significant investments in the U.S. Joint Strike Fighter program. Even though both nations claim that their participation in JSF will not undercut their commitment to Eurofighter, industry experts don't seem so sure.

The Eurofighter program is also colliding with other huge U.K. procurement projects planned for the next decade, such as the A400M transport aircraft, two aircraft carriers and the new Type 45 destroyers.

The British press reported that the U.K Ministry of Defence is withholding part of its payments for the Eurofighter until ongoing problems are rectified. However, the MOD said that, despite the delay, the program is not in "deep trouble."

The Eurofighter marketing team has set an ambitious goal of exporting 500 aircraft by 2022.

That goal is unlikely to materialize, said Bill Dane, an aerospace industry analyst at Forecast International DMS, a business intelligence research firm.

Making things tough for Eurofighter is the fact that most countries do not need, or have the money to buy expensive fighter jets. Some see the JSF as a better deal. The Pentagon, additionally, continues to lobby...