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STEVE RODAN JDW Correspondent Tel Aviv Additional reporting CRAIG HOYLE JDW Aviation Editor London  The
Israel Air Force (IAF) has informed a consortium of Israeli companies that
it does not intend to upgrade its fleet of F-16 fighter aircraft for at
least another two years. This comes as a major blow to the group, which had hoped to modernise some 240 F-16A/B/C/Ds of the 260 aircraft to have entered air force service since 1980. The consortium is offering to upgrade aircraft at a unit cost of about $4 million, with work hoped to focus initially on improving older-model F-16A/Bs. Service officials said the IAF had warned from the start that it was not interested in conducting a full F-16 upgrade, and that many overhaul tasks would continue to take place at military facilities in order to save money for the procurement of new aircraft. Israel has already placed a $2.5 billion order for 50 F-16Is, and plans to sign a contract later this year, believed to be in October, for an additional 60 aircraft held under a fixed-price option. The F-16I acquisition will give Israel sufficient front-line aircraft, said IAF officials, who added that the service's legacy fleet of the aircraft will continue to perform support missions. Israel's intention to acquire a second batch of F-16Is was underlined by Ministry of Defence officials during a 1 June visit to the USA, when they announced that the Pratt & Whitney F100-PW-229 engine selected for the first 50 aircraft will also power the second batch. The follow-on purchase of 61 engines is expected to be finalised in late June and value around $300 million, according to company officials, with deliveries to take place between 2005 and 2008. State-owned Israel Aircraft Industries (IAI) heads the Israeli consortium offering to upgrade the IAF's current F-16 inventory, with this group also comprising: Elbit Systems and its subsidiary El-Op Electro-Optics Industries; Elisra Electronic Systems; Israel Military Industries; RADA Electronic Industries; and the Rafael Armaments Development Authority. Lockheed Martin was also a consultant during the design of the upgrade programme, in addition to promoting its F-16 Mid-Life Update. The Israeli team also plans to offer its F-16 upgrade to other nations that operate the US-designed aircraft, and is expected to exhibit a modified F-16B at the Paris Air Show, from 17-24 June. Industry sources said that a combination of internal rivalry between Elbit and IAI and Israel's current political difficulties with the Palestinians could threaten the design's sales potential.
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