From left to right: Boeing Director for Central Europe Earl Godby, Economy Minister Ľubomír Harach, and Vice-President of Aero Vodochody Jiří Fidranský.photo: Courtesy CEC Government Relations
Czech firm Aero Vodochody said that it had taken a step closer to winning a possible 50 billion crown ($1 billion) contract to supply the Slovak airforce with subsonic jets after an April 24 deal with two Slovak firms.
Vodochody, which is part-owned by American aeronautics giant Boeing, signed Memoranda of Understanding (MoUs) with Slovak companies DMD Trade, a division of DMD Holding, and Virtual Reality Media on the promotion of each other's products in Slovakia and the Czech Republic.
The deal means that the Czech firm could push its L-159 aircraft, which it hopes to sell to Bratislava in a tender later this year, while DMD could do the same with its own 'Zuzana' howitzer and other military hardware.
The deal has taken on extra significance in the light of recent comments made by Economy Minister Ľubomír Harach that the supply of the planes could be partially bartered by a swap of military equipment between Prague and Bratislava. The 'Zuzana' is the predecessor to a howitzer model the Czech armed forces already have but need to upgrade
"Signing these memoranda is the beginning of the path to winning this tender," said Jiří Fidranský, vice-president of Aero Vodochody. "We are confident we can win it, and we are now in a strong position," he added.
Slovak Defence Minister Jozef Stank immediately moved to play down suggestions that any pre-emptive deal might be struck regarding bartering for the planes. He said after the MoUs had been signed that until cabinet approves a development plan for the air force - expected in November this year - he will not hold talks with any potential contractor for the delivery of subsonic airplanes for the Slovak Army in connection with any deals.
Speaking on private Rádio Twist April 30, Stank also said that a swap deal was unlikely anyway if only heavy artillery were offered, the relative values of the hardware being so far apart (an L-159 costs approximately $12 million).
"We could buy only a few planes in exchange for the Zuzanas that the Czech army would need," Stank said. However, it is believed that Slovakia would also be able to offer the highly-regarded 'Aligator' armoured vehicle, produced by central Slovak firm ZŤS Defence, part of DMD Holding, on top of the Slovak howitzer.
DMD may be key
DMD, the producer of the Zuzana, was beaten by BAE System's AS-90 in a tender for heavy artillery in Poland last year, and some sources close to the deal suggest that resentment may linger within the Slovak defence industry over DMD's loss at the hands of BAE.
BAE Systems' Hawk is the main rival to the L-159, and is expected to be the Czech firm's main competitor to supply the jets to Slovakia.
However, even senior staff at DMD have said they are unconvinced the recent MoUs will influence the Defence Ministry's selection of a winner in a future tender.
"It's very difficult to be certain of such a link because these [the subsonic jets and the howitzers] are two very different products going to two different parts of the [Cezch and Slovak] armed forces," said Ivan Subrt, general director of business strategy at DMD Holding, DMD Trade's mother firm.
But in light of the possible deal on the weapons swap, the significance of Vodochody's good relationship with DMD may still be paramount.
"DMD is going to be a key player for our activities in Slovakia," Earl Godby, Boeing director for central Europe, told The Slovak Spectator.
