Latin America is developing for Saab is increasingly becoming a key strategic market for Saab in the military aviation sector. While in F-39 Gripen E/F (local designation) is continuing in Brazil and in Colombia is also looking at a possible contract awardPeru has now also made a decision in favor of the Swedish manufacturer. On July 4, the government under President Dina Boluarte confirmed the planned procurement of 24 Gripen E fighter jets at an estimated total value of around 3 billion euros.
Two-stage procurement program
The award marks the conclusion of an evaluation process lasting several years, in which Gripen E prevailed over two other international competitors. The planned procurement follows a two-stage financing model that provides for the gradual replacement of the ageing Mirage 2000 and MiG-29 fleets of the Fuerza Aérea del Perú (FAP) – many of these aircraft have already been in service for more than three decades.
The first financing phase of around 1.7 billion euros will be covered by a national loan from the Banco de la Nación and is already included in the budget for 2025. The second tranche of 1.3 billion euros will then follow in 2026.
G2G approach and technology transfer
The government describes the planned purchase as a strategic acquisition as part of the Ministry of Defense’s long-term objectives. The basis for this was the recent adoption of the “Debt Law 2025” by the Peruvian Congress. A corresponding decree of national interest, which formally confirms the purchase, is to be signed shortly.
On July 10, Swedish Defense Minister Pål Jonson is expected in Lima together with his Peruvian counterpart Walter Astudillo Chávez to finalize the terms of an intergovernmental agreement (G2G). Saab representatives will not be attending the meeting, but bilateral engagement remains central, particularly with regard to technology transfers and future security cooperation.
F-16 and Rafale outperformed
Peru opted for the Gripen E over the F-16 Block 70 from Lockheed Martin and the Rafale F4 from Dassault Aviation – mainly because of the more favorable cost structure and a significantly shorter delivery schedule. Saab states that it will be able to deliver the first aircraft within 24 months of signing the contract. At least two jets are scheduled to arrive in Peru by July 23, 2026, the anniversary of the FAP.
An interesting detail: the two-seater Gripen F variant, eight of which were procured by Brazil, is not included in the Peruvian order. The Peruvian pilots are therefore likely to be retrained either in Sweden or in cooperation with Brazil.
High price – or comprehensive package?
Even if the contract award to Saab is a clear success, the unit costs of 93 to 102 million euros per aircraft that have become known raise questions. Although they are significantly lower than those of the eliminated competitors (between 144 and 204 million euros), they are still considered comparatively high – especially as the Gripen E is often positioned as the “most cost-efficient fighter jet”.
The offset agreements and additional services included in the package could provide an explanation for this. In any case, intensive talks were held between Saab and representatives of the Peruvian military in the previous month, during which negotiations focused primarily on the compensation package. This is to include investment commitments and technology transfers that also extend beyond the military sector.
Peru and Saab already have a certain industrial history: previous collaborations have included the co-production of patrol boats by local shipyards. Exactly which services are included in the current contract – and to what extent these affect the overall price – will probably only become clear when the final state contracts are published. It remains to be seen if and when these will be made public.
Here for more news about Saab and here to further news about the Peruvian armed forces.
