Gripen Success Story Hu Low

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Gripen Success Story Hu Low

  1. 1. SPE CIA “ A magazine from Gripen International March 2006 Gripen News Exceeding SUCCESS STORY: HUNGARY L ED ITIO N expectations! Gripen offset deal delivers results. Success Delivery What the magic word The delivery of the first “offset” really means. five of Hungary’s 14 How it works and Gripen! All delivered benefits Hungary. during 2006 and 2007.
  2. 2. Gripen succe Tailor made for industrial and economic growth. Today, offset deals are a natural component of any major defence investment. The Gripen approach to offset (sometimes called industrial cooperation) is unique. Gripen’s offset philosophy benefits the entire Hungarian economy, creating a launch pad for sustainable, long term growth. But what does the magic word “offset” really mean, how does it work and how does it benefit Hungary? By Tomas Långdahl and Philip Squire Offset the Gripen way. The Gripen effect. For Gripen, it’s essential that the offset deal is tailor made By investing in projects with real strategic and commercial to meet the customer nations’ specific needs, involving key potential for Hungary, the Gripen offset program contrib- areas that are important for the nation’s future growth. In utes to the Hungarian economy in ways that go far beyond close cooperation with their strong network of industrial the measurable generated offset value. and financial partners, they ensure that viable businesses The initial offset investment gets the ball rolling and with are started, supported and developed within the customer time results can be seen in GDP growth, industrial and nation. Businesses that, in many cases, are not directly technological development, regional development, new jobs related to the defence deal. Why? Because Gripen and their and increased tax revenue. As you can see in the diagram customers want to make sure that the offset program results below, success in one area contributes to growth and in sustainable, organic growth that benefits the entire nation development for the whole nation. At the end of the aircraft in a way that will continue to develop and expand, long after agreement Hungary will have benefited by far more than the the actual offset obligation is fulfilled. A long term, tailor 110% of the contract value required by the agreement. As made commitment to your nation. this growth is the result of a tailor made, sustainable, long term commitment, the Gripen effect really will continue to benefit Hungary long into the future. The Gripen way Projects using real needs and business opportunities leading to sustained organic growth The traditional approach Forced or subsidized businesses which die as soon as the offset obligation is fulfilled Obligation span 2
  3. 3. ess story “For many Hungarians the word ‘Gripen’ means not only a high tech Swedish fighter but also a fantastic long-term economic development program. The program is running ahead of schedule and I’m confident that the whole country will continue to benefit, both from the new defence capability that the Gripen brings and from the long term economic benefits of the offset program.” Dr. Szabó Sándor Head of Offset Section Ministry of Economy and Transport
  4. 4. Offset in action Dynamic and adaptable. A vital part of a successful offset deal is the ability of the supplier to adapt and adjust according to new business and investment opportunities that will allow Hungary to expand and develop. This is another area where Gripen excels. In order to take advantage of Hungary’s strategic posi- tion and skilled and highly qualified workforce, Gripen has been able to adapt and expand the offset deal into exciting new areas. The offset program is well ahead of schedule with benefits set to grow and grow. By Tomas Långdahl and Philip Squire Over 70% fulfilled. Expansion into new areas. At the Offset Committee meeting on the 3rd of March 2006, In order to take full advantage of Hungarian strengths: the Hungarian Ministry of Economy and Transport approved a strategically important position in Europe, excellent Gripen’s 8th offset claim. According to the decision, the logistics and a highly skilled and rapidly developing work- offset value approved is worth 57 MEUR. The current status force, the offset deal has been expanded into Information of the Hungarian Gripen programme now shows that over Technology, Biotech and High Technology. This expansion 70 % of the total obligation has been fulfilled, making a into new areas could easily have slowed down the project. total value of 550 MEUR for the offset activity performed by However, thanks to Gripen’s vast experience and proven Gripen International in Hungary since December 2001. flexibility, they and their partners were able to move into these new areas without delay. This meant they were able to take advantage of new opportunities as they presented themselves. Further development into new sectors. The Gripen Offset program continues at full speed and is currently expanding into even more new industry sectors, such as glass, involving Hungarian small medium enter- prises (SME) and generating further net export value and new investments into the Hungarian economy. 4
  5. 5. Gripen radar PS-05/A-Mk3 provides the Situation Aware- ness needed for supporting co-operative and multi-role/ swing-role combat missions. The radar sensor system provides data to the onboard weapons for cueing and interception guidance. Ericsson Facts: Ericsson’s multi-mode radar system gives the Gripen system superior: • Air-to-air combat, long and short range (Beyond and Within Visual Range) • Strike missions over land and sea • Reconnaissance, mapping, navigation, surveillance • 3rd party, targeting and mid-course updates • ECCM features (Electronic Counter Counter Measures) Ericsson Ericsson Hungary is one of the largest companies in the country and was in fact established as part of another offset deal in 1991. Since then has it has continued to grow and today employs some 700 staff, 400 of whom are researchers in the fields of mobile telecommunications, the Internet, and issues concerning traffic, structure and the quality of mobile and traditional telephone networks. Ericsson is a contributor both to the aircraft itself and to the Gripen offset program. Ericsson supplies the highly ad- vanced and proven PS-05/A-Mk3 radar for the Gripen and the offset program acted as the catalyst for the establishment of the Ericsson Global Service Delivery Centre (GSDC) in Budapest in 2004. The centre currently employs 150 experts and this is set to increase in 2006. The highly qualified en- gineers at the GSDC deliver Software Supply & Integration, Systems Integration Network & Technology Consulting and Tools & Services Development to the global marketplace. The Ericsson presence in Hungary is a perfect example of how offset can act as a catalyst for stable long term develop- ment. The success story is down to the combination of great staff, the right products and Hungary’s place in the global marketplace.
  6. 6. Semcon Facts:With over 1,600 employees and sales of SEK 1.5 billion (2004) Semcon is a leading international design and develop- ment company. Semcon AB (publ) is listed on the Stockholm Stock Exchange and has operations in Sweden, Australia, China, Denmark, Hungary, Malaysia, Norway and UK. In ad- dition, Semcon AB is represented via partners in seven other countries. Semcon AB Semcon, a leading international design and development Semcon has partnership deals with Volvo Car Corpora- company is one of the latest industrial partners to be added tion, Ericsson and General Motors Europe. The company is to the Gripen offset trade group in Hungary. Setting up an experiencing substantial and stable growth and is an ideal office in Budapest is a natural part of Semcon’s strategy for long term partner in Hungary and other markets. international expansion, recruiting the right people and providing their customers with the best choice for product Ten Hungarian consultants have been employed and have development. undergone a ten week training course in Sweden and Sem- con Hungary has already signed its first contract within the auto industry sector. Electrolux Hungary plays a strategic role within the Electrolux Group both from a production and marketing point of view. This is proven by the fact that one of the most important manufacturing bases of the Group is situated in Jászberény. Today Electrolux Lehel Kft. is one of the biggest industrial companies in Hungary with a determinant role in the indus- trial exports of the country. Electrolux Facts: In 2005 Electrolux Lehel Kft.’s sales totalled HUF 133 billion.We have manufactured and sold 5.0 million products for both the export and domestic markets, while we’ve further increased our profitability. Electrolux Lehel Kft. employs about 3,700 people, making it the largest employer in the Northern Plane Region.
  7. 7. Haldex In October 2004, Haldex inaugurated a newly built factory Haldex in Hungary for final assembly and testing. The factory, Facts:With headquarters in Stockholm, Sweden, Haldex is which currently covers 5,750 m2, is one of several planned a provider of proprietary and innovative solutions to the actions to improve the group’s competitiveness and strategic global vehicle industry, with focus on products in vehicles position. Haldex production and sourcing in Hungary and that enhance safety, environment and vehicle dynamics. other East European countries is increasing at the same Haldex is listed on the Stockholm Stock Exchange and has time as the group’s production in Western Europe is being annual sales of nearly 8 billion SEK with 4,600 employees. reduced. When fully utilized, the factory will employ 140 people. Halton Clean Air Halton Clean Air is a leading air filter manufacturing Halton Clean Air company and is a market leader in their home country Facts:The Halton group has some 800 employees, of Finland. The decision to invest in Hungary and open operations in 15 countries and a turnover of over € 100 a production plant in Vecses made sound sense to this million. Halton Clean Air’s innovative air cleaning solutions expanding organization. The factory produces air filters combined with the Halton Group’s global sales network for central European markets where the main customer and solid customer base means exciting new opportuni- segments are general industry, commercial buildings and ties for growth in Europe, Asia and the USA. hospitals. These markets are especially interested in clean indoor air as a way to protect their most valuable assets: their staff, machinery and production processes. Hungary’s ideal geographic situation as well as the highly skilled and motivated workforce made the choice of Hungary an easy one for Halton Clean Air.
  8. 8. Take off ! The Gripen aircraft program is right on schedule. By selecting the Gripen in 2001, Hungary became one of the first NATO members to order an advanced, multi-role, latest generation fighter aircraft for national defence tasks as well as missions for NATO and the European Union.
  9. 9. By Tomas Långdahl and Philip Squire Delivery The delivery of the first 5 of Hungary’s 14 Gripen aircraft took place in March 2006 and all remaining aircraft will be delivered during 2006 and 2007. The Gripen aircraft. Advanced, capable and cost-efficient… The lease of the 14 aircraft will run for 10 years, after which ownership will pass to the Hungarian government. This means that Hungary is now one of the first nations to have one of the most advanced combat aircraft in the world. Gripen is a fully NATO interoperable multi-role fighter, tailored for the Net Centric Warfare environment of the 21st Century. Designed to break the cost-curve, it will meet the demands of current and future threats, be it in the air, at sea or on the ground. Using the latest available technology, it is capable of performing an extensive range of air-to-air and air-to-surface operational missions and employing the latest weapons. Gripen meets the strict requirements of any modern Air Force for deployability, reliability, and mission efficiency – and to an unbeatable life cycle cost. In addition to the Hungarian Air Force, Gripen is also in service with the Swedish and Czech Republic Air Forces and has been ordered by the South African Air Force. The UK Empire Test Pilots’ School (ETPS) is operating Gripen as its advanced fighter platform for test pilots worldwide. …but still just a part of the total package. Just like the offset program, the tailor made Gripen aircraft support program is a large-scale, wide-ranging package. As well as the actual production, flight testing, and delivery of the 14 aircraft, the package includes comprehensive operational and tactical training for pilots and maintenance technicians. Gripen will also provide Ground Support Equipment, simulators, Mission Support System (MSS), spare parts and extensive Integrated Logistical Support (ILS). The process runs under strict supervision and to the highest quality standards, ensuring maximum performance, knowledge transfer and skills within the Hungarian Gripen team of pilots and ground personnel. • December 2001 Hungary and Sweden agree to lease Gripen aircraft • February 2003, Hungary and Sweden agree a lease and purchase contract • 14 Gripen aircraft, 12 single seat and 2 twin seat to be delivered • 110% offset program • January 2005 Roll-out of first aircraft • January 2005 training of the first 5 Hungarian Gripen pilots commences in Sweden • February 2005 first flight of Hungarian single seater • April 2005 training of the first 19 Hungarian Gripen technicians commences in Sweden • October 2005 first flight of Hungarian twin seater • 5 Aircraft delivered March 2006 • Remaining aircraft to be delivered during 2006-2007
  10. 10. Training The first group of 5 Hungarian pilots to start their conversion training to Gripen arrived in Sweden in January 2005 and the initial group of 19 technicians arrived in Sweden in April the same year. Both groups worked through a comprehensive program and the Pilots were trained to become instructor pilots on the Gripen in the Hungarian Air Force. This means they will be able to return to Hungary and train Hungarian pilots, providing a large degree of independence for the Hungarian Air Force. By Tomas Långdahl and Philip Squire Pilots The pilots were based at the Swedish Air Force F 7 wing at Såtenäs, which is the Swedish training centre for Gripen. They completed their training in Sweden during January-February 2006 at the Defence Materiel Administration (FMV) test centre at Malmen. This final phase in their Gripen training was the conver- sion to the latest, most up to date C and D versions of the Gripen, which is the version the Hungarian Air Force has received. They also flew their own Hungarian Gripen aircraft before returning to Hungary. The second group of Hungarian pilots will come to Sweden for the initial Gripen training in August 2006. As they will be able to receive instruction on their own Gripen aircraft from Hungarian pilots in Hungary, they will spend less time in Sweden than the first group. 10
  11. 11. Technicians Training of the first 19 Hungarian technicians started in April 2005 at the SwAF technical school outside Halmstad in Sweden. Here they commenced their training on Swedish Gripens. During January-February 2006 the technicians trained on their own Hungarian Gripens at the FMV test centre Malmen, before returning to Hungary. The second group of Hungarian technicians will come to Sweden in August 2006 to start their training on Gripen aircraft.
  12. 12. The Gripen flight experience Major General Sági János, Chief of Staff of the Hungarian Army Air Force, had an early chance to fly a Gripen. This is what he had to say after his first flight. “Gripen is cost effective, safe and easy to operate. Gripen’s new ergonomic concept means dynamic manoeuvres are rapid and precise and the aircraft reacts faster to control inputs, yet you know that you’re protected by the safety systems at all times. Major General Sági János In my opinion, it’s the perfect aircraft for the Chief of Staff of the Hungarian Air Force.” Hungarian Army Air Force Gripen News is published by Gripen International. Published by Owe Wagermark, Gripen International Opinions expressed in this magazine are not necessarily those Gripen News, Gripen International, Communications Department, of the Company. Reproduction of any article is permitted by SE-581 88 Linköping, Sweden • E-mail anne.olsson@gripen.com acknowledgement. Phone +46 13 18 4000 • Telefax +46 13 18 0055 www.gripen.com Photography: Page 1, Pia Ericsson, FMV. Page 8, Zord Gábor.

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