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U.S. Saudi Sale, With Helicopters, Said to Approach $60 Billion

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U.S. Saudi Sale Said to Approach $60 Billion
Blackhawk helicopters. PhotographerJustin Sullivan/Getty Images

Aug. 13 (Bloomberg) -- A proposed U.S. weapons sale to Saudi Arabia of Boeing Co. F-15 fighter jets also includes as many as 132 Boeing Apache attack helicopters and United Technologies Corp. UH-60 Black Hawk helicopters that bring the total value of the package to around $60 billion, according to a government official familiar with the plan.

The Pentagon and State Department about two weeks ago informally notified congressional committees that handle arms sales of the planned transaction, the official said.

“I think it would be the largest ever,” said William Hartung, director of the New York City-based New America Foundation’s Arms and Security Initiative.

“Other deals that used to be considered large,” like the $9 billion sale of 72 F-15s to the Saudis in 1992-93 or the kingdom’s $9 billion acquisition of U.S. AWACS surveillance aircraft in 1981, “aren’t even in the ballpark, even allowing for inflation,” Hartung said.

The package includes 84 F-15s at a cost of $30 billion and helicopter sales totaling about $30 billion that include spare parts, training simulators, long-term logistics support and some munitions.

The Saudis would buy about 72 UH-60 Black Hawk helicopters and as many as 60 AH-64D Longbow Apaches, the official said. The Longbow is the U.S. Army’s premier anti-tank helicopter, capable of firing laser-guided or all-weather air-to-ground missiles. The Longbows are in addition to 12 that Congress in 2008 cleared Boeing to sell to the Saudis.

Fits Obama Strategy

The proposal fits the Obama administration’s strategy of buttressing the defense capabilities of Middle East allies to counter Iran’s growing offensive missile might and suspected nuclear weapons program. It would be part of the Gulf Security Dialogue started by the Bush administration.

The Longbow Apache has been sold to Egypt, Israel, Greece, Kuwait, the United Arab Emirates, the Royal Netherlands Air Force, Singapore and Taiwan. Northrop Grumman Corp. and Lockheed Martin Corp. provide the Apache’s radar and sensors.

The Pentagon intends to formally notify the Senate and House foreign affairs panels by mid-September of the final arms package, the official said.

“In the past, a record-setting deal to a region of tension like the Persian Gulf would have drawn considerable congressional opposition,” Hartung said. “That does not seem to be the case this time around.”

Other Issues Dominate

“Other foreign policy issues from Iraq and Afghanistan to the consideration of the New START treaty, seem to have taken up most if not all of the attention Congress can or will spend on foreign policy matters,” Hartung said. The U.S. Senate is scheduled to consider the new Strategic Arms Reduction Treaty with Russia when it returns next month from its summer recess.

Saudi Arabia’s last significant U.S. weapons purchase was 72 F-15s in 1992, a transaction valued at as much as $9 billion. The last planes in that contract were delivered in November 1999.

The kingdom spent $36.7 billion worldwide on arms and support activities from 2001 to 2008, according to the nonpartisan Congressional Research Service.

For Related Information and News: Boeing’s sales breakdown: {BA US <Equity> FA GEO <GO>} Saudi Arabia defense news: {TNI SAUDI DEF <GO>} United Technologies analysis: {UTX US <Equity> FA <GO>} General Dynamics revenue: {GD US <Equity> FA PGEO <GO>}

To contact the reporters on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editors responsible for this story: Mark Silva at msilva34@bloomberg.net

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