Germany is considering ditching a £90 billion fighter jet project with France and joining a rival programme with Britain.
Ahead of a potential deal, the German Chancellor, Olaf Scholz, is in discussions about removing Germany’s veto on a delivery of Eurofighter Typhoon jets to Saudi Arabia, which the UK considers important strategically.
A pact of this nature would amount to a coup for the UK and reflect a progressively intensifying rift between Germany and France, with the two nations holding contrasting views on issues including diplomatic protocol, air defence and energy.
The fighter jet issue has left Scholz with tough choices that will factor in his nation’s alignment in Europe and worldwide.
He must decide whether to keep the Future Combat Air System (FCAS), a leading Franco-German-Spanish programme to construct the next generation of air power, which some analysts have hailed as Europe’s most significant defence project.
A Typhoon fighter jet in the skies above the Amari Airbase in Estonia, Thursday July 27, 2023
The central focus of the project is to use a single platform to digitally interweave a new brand of stealth fighter with drones, automated minifighter jets, older combat aircraft and naval or ground-based assets.
Germany has put aside €40 billion (£34.9 billion) of investment for FCAS and it is set to enter the market by 2040. But the scheme has faced delays and there have been clashes over its financing and design.
Sources familiar with Scholz’s thinking say he is worried that the project could turn into a white elephant and fall behind competitors, The Times reports.
The US navy and air force each plan to field their own new types of sixth-generation jet by 2030.
Rolls-Royce and BAE Systems are taking the leading role in developing a stealth fighter known as the Tempest, scheduled to be ready by 2035. It will form the foundation of a wider British-Italian-Japanese aerospace alliance.
One senior German official told the newspaper that Scholz did not see any point in FCAS competing with Tempest and wanted either to merge the two or jettison FCAS and join Tempest if that wasn’t a possibility.
Scholz is also said to be frustrated by the preferential treatment France has handed to its own aerospace firms in the early stages of the FCAS project.
The source said that Scholz was annoyed that Prime Minister Rishi Sunak had yet to visit him in Berlin and wanted to see much more direct engagement from figures at the top of the UK government over strategic questions if a tighter UK-German partnership were to manifest.
British officials note that Sunak joined the Munich Security Conference in February and has taken part in phone calls and four face-to-face meetings with the Chancellor on the sidelines of international summits this year.
Another issue is the Israel-Hamas war.
Germany has shown support for Israel and sources told the newspaper that the government would prefer to wait to see how Saudi Arabia positions itself before Berlin takes a decision on weapons deliveries.
The Typhoon (pictured) programme run by Lancashire-based BAE employs more than 6,000 aircraft specialists and supports an estimated 28,000 jobs in the supply chain
Saudi Crown Prince Mohammed bin Salman (also known as MBS) meets Chancellor Olaf Scholz and his delegation at As-Salam palace in Jeddah, Saudi Arabia, on September 24, 2022
The next-generation combat aircraft decision is closely tied to a British-German dispute over the delivery of 48 Eurofighter Typhoon jets to Saudi Arabia in a package that could be worth more than £5 billion.
The Typhoon programme run by Lancashire-based BAE employs more than 6,000 aircraft specialists and supports an estimated 28,000 jobs in the supply chain.
Production lines at the company’s factories would close without further orders for the aircraft from overseas because the Royal Air Force is phasing out the Eurofighter Typhoon from 2025.
The jet was built by a consortium, including the UK and Germany, and export licences must be approved by all its members.
Germany is blocking Britain’s deal to sell 48 aircraft to Saudi Arabia due to the country’s controversial human rights record.
Berlin adopted this stance following the murder by Saudi agents of dissident Jamal Khashoggi in 2018 – and in protest at the deaths of civilians caused by Saudi air strikes in Yemen. Its veto could cost £15 billion, which Britain would have to raise from other markets to maintain the production lines.
Scholz is apparently unwilling to upset Green politicians, who strongly oppose arms sales to Saudi Arabia.
When asked about the issue at a Nato summit in July, Scholz said ‘no decision’ on Typhoon deliveries to Saudi Arabia was ‘foreseeable at the current time’.
Any funding shortage could also have a knock-on effect on research and development of Britain’s next-generation fighter jet, the ‘GCAP’.
Justin Bronk, from the RUSI military think-tank, said: ‘Not securing the sale would be a black mark against the UK’, in terms of its reputation as a reliable arms partner.
The deal was initially signed by the UK Government five years ago, when it was assumed the sales would be supported by Germany, Italy and Spain.
The Government said: ‘The UK remains steadfast in its commitment to our strategic defence relationship with the Kingdom of Saudi Arabia.’