U.S. aircraft manufacturer Boeing has silently delivered the first airborne early-warning and control (AEW&C) aircraft to Turkey under a program that was launched more than a decade ago. Now, however, the buyer and the seller are wrangling over penalties for delays Hurriyet Daily News reported.
The defense procurement agency, the Undersecretariat for Defense Industries (SSM), and the Turkish Air Force simultaneously announced Jan. 31 that the AEW&C aircraft had arrived in Turkey for acceptance tests. The tests are to be followed by an inauguration ceremony Feb. 21 at the 3rd Main Jet Base Command in Konya, they said.
Last year, Defense Minister İsmet Yilmaz said Turkey would impose sanctions on Boeing for the delays.
Under a July 23, 2003, contract priced at more than $1.6 billion, Boeing was to develop and deliver four AEW&C aircraft to the Turkish Air Force by 2008. The program involved the delivery of the 737-700 airframe, ground radar and control systems, ground control segments for mission crew training, mission support and maintenance support.
Recently, press reports said Turkey demanded Boeing pay $600 million in penalties, but defense officials denied that there has been a deal on any amount of penalty.
There are disagreements over whether the delays stemmed entirely from the company's shortcomings or whether they were due to extra features that Ankara demanded be installed on the aircraft, officials said.
Yilmaz said last April that Boeing only had to pay for the delays considered to be the company's fault.
"But this is not always an easy task to find out and agree on," said one official familiar with the program. "We are trying to iron out our differences."
Even when they agree on compensation, neither Turkey nor Boeing may announce the matter, citing clauses in the contract necessitating "commercial secrecy."
The 737-700 aircraft are to be used as part of Turkey's NATO capabilities. An airborne early-warning and control system is an airborne radar system designed to detect aircraft, ships and vehicles at long ranges, and to control and command the battle space in an air engagement by directing fighter and attack aircraft strikes. Used at a high altitude, the radars on the aircraft allow the operators to distinguish between friendly and hostile aircraft hundreds of miles away.
Industry sources familiar with the talks said part of the compensation may come in the form of free spare parts, larger local work share for Turkish companies, free ground control equipment and extended guarantees.
Turkish companies that work as subcontractors of the program, dubbed the Peace Eagle, include Havelsan, Turkish Aerospace Industries (TAI), Mikes, Aselsan and Turkish Airlines (THY).