Disagreement over Czech Gripen lease extension terms
December 23, 2024
The Czech Republic leased 14 ex-Swedish Air Force Gripen C/D fighters in 2004, subsequently extending the lease to 2027, and holding the option of purchasing the aircraft from Sweden. It now hopes to further extend the lease to 2035. While the Czech Republic still seemed likely to ‘purchase at the end of lease’ or better yet, buy the new Gripen E, it was in Sweden’s interests to keep the terms of the lease as reasonable as possible. But many believe that once the Czech Republic chose to purchase the Lockheed Martin F-35A instead, the incentive to be accommodating vanished, and lease extension terms hardened, resulting in some bitterness on the Czech side.
Certainly, Sweden was unhappy that the Czechs had opted for an American aircraft, rather than a European one, and may have been particularly exercised that Saab had not been invited to submit an offer for the supply of its own new fighter, the Gripen E.
Czech news website Novinky headed its piece on the lease deal ‘Zhrzení Švédové Česku napálili cenu za pronájem gripenů’ (which translates as: ‘Disgusted, the Swedes cheated the Czech Republic on the price for renting Gripens!’).
The problem is reportedly that the Swedish government expect the Czechs to pay for a major upgrade of the Gripens, which would otherwise become an orphan fleet that would be almost impossible to support. This means that the annual cost of the lease was bound to increase from the present level of 1.7 billion Koruna (Czech crowns or CZK). Last year, the Czech Ministry of Defence estimated that the new lease contract for Gripens would be 30-40% more expensive, but while exact prices have not been revealed, it is believed that the cost may be much higher – perhaps even double today’s price.
At the end of August, Defense Minister Jana Černochová held talks with her Swedish counterpart, subsequently saying that she had not been satisfied with the outcome and that further negotiations would be required. “We are accountable to taxpayers and I want to be 100% sure that the conditions for the Czech Republic will be defensible to both the government, the opposition and citizens,” she said in a press release.
Novinky reports that the Czech MoD has requested further negotiations and quoted Lubor Koudelka, head of the armaments section of the Ministry of Defence, as saying that: “The current offer is not acceptable to us, but that does not mean that the negotiations are over. For us, Gripens are still the most preferred option for airspace protection until 2035, but we have to come to an agreement with the Swedes and they have to submit a new offer.”
The Czechs are trying not to look too reliant on the Gripen lease extension, signed an agreement with Slovakia under which the Czech Air Force will protect Slovakian airspace for another year, with the implication that in the future NATO partner Slovakia could ‘return the favour’. The Czech MoD noted that: “The signed declaration confirms Slovakia’s willingness to help in the future with the protection of the airspace of the Czech Republic, if necessary for any reason.” Such an arrangement would be unlikely to bridge the eight year gap between the end of the Gripen lease and the arrival of the F-35A, however.
The decision to procure the F-35A (at a reported cost of CZK150 Bn) has already been subject to some criticism, particularly on cost grounds. Lubomír Metnar the head of the defence committee and a former defence minister noted that: “The purchase of the F-35 is proving to be a problematic acquisition, which we will finance at the expense of other projects.”
