Saudis Delay $15-Billion Deal to Buy U.S. Fighters

In a blow to the U.S. aerospace industry, Saudi Arabia has informed the United States that it will not try this year to buy 102 F-16 jet fighters in a deal worth up to $15 billion, Pentagon officials said Thursday.

The Saudis are delaying any purchase out of anger at the Israeli reaction to their plans and advance publicity about them, U.S. sources said.

Israeli Prime Minister Benjamin Netanyahu expressed alarm this week over the possible sale.

A new fleet of fighters would boost the kingdom’s ground-attack capability and alter Israel’s qualitative edge over its Arab neighbors.

The deal involving the sophisticated warplanes produced by Lockheed Martin Corp. was expected to be discussed later this month during a visit by the highest-ranking Saudi delegation to come to Washington in a decade.

But now “no formal request will be made any time soon,” a well-placed Mideast source said.

At a joint news conference Thursday with Netanyahu, President Clinton said the United States had “a long and important defense partnership [with Saudi Arabia] which persists to this day” and has contributed to the security of Israel.

Clinton confirmed that the Saudis had not asked for the F-16s.

Washington would “seriously consider” any future request but would not do anything to undermine Israel’s security.

But the waters appear to be muddied by Israel’s attempt to make an issue of a potential sale--especially at a time when Israel is pressing for greater Saudi visibility behind the peace process and a public warming to Israel.

The kingdom was furious about Netanyahu’s intervention, Pentagon officials said.

Over the last two years, the Saudis have become increasingly interested in the F-16s to replace their aging fleet of F-5s.

But the deal was also widely seen as a sweetener to counter growing U.S. bitterness, repeated this week by senior FBI officials, about lack of Saudi cooperation in investigating two bombings that have killed 25 American military personnel since 1995.

“It would be a way of reminding us that they have favors to dispense,” a Pentagon official said.

The F-16s each sell for a minimum of about $30 million but could go much higher depending on how they are equipped, with the total price possibly going as high as $5 billion.

An additional package of training, munitions, spare parts and maintenance, which the Saudis usually buy with U.S. military equipment, could add an additional $10 billion, Pentagon officials said.

By beefing up Lockheed’s Fort Worth, Texas, production plant, the Saudi deal would also potentially have helped lower costs of the Air Force F-22 project, which is now estimated to cost $73 billion, Pentagon officials said.

Previous Saudi purchases have lowered other production costs for U.S. military equipment, such as the M-1 tank, and even kept alive industries that were no longer viable without major foreign purchases.

The F-16 deal is not dead, both U.S. and Lockheed officials stress.

Prince Sultan ibn Abdulaziz, the deputy prime minister and defense minister who will lead the Saudi delegation to Washington, this week called the F-16 a “good replacement” for the F-5s.

Well-placed Mideast sources added, however, that Riyadh was still in the midst of taking delivery of F-15s and British-made Tornadoes, and the kingdom’s defense expenditures were already high.

The Saudis now owe the United States more than $10 billion for equipment, including F-15s and Patriot missiles, purchased after the 1991 Persian Gulf War, according to the Pentagon.

But the Saudis are known to be sensitive about publicizing their intent.

The kingdom withdrew a $5-billion bid on passenger aircraft from the European Airbus Industrie several years ago when news was leaked by French officials.