As well as being the biggest contract ever in South America for Eurocopter, the new Franco-Brazilian defense deal is the biggest ever export order for France's military shipyard DCNS.
The figure of €7 billion ($10 billion) is being bandied about for the four conventionally-powered submarines, technical assistance to build Brazil's first nuclear-powered submarine and building a naval base and a new shipyard near Rio de Janeiro.
The first of the four submarines, due to be operational in the Brazilian navy by 2015, will largely be built at the DCNS shipyard in Cherbourg, north-west France. The next three, however, will be built in Brazil under a technology transfer deal through a joint venture which will be set up by DCNS and the Brazilian company Odebrecht. Some of the complex and sensitive equipment (torpedo launch tubes for example) will, however, be made in France.
Assistance for the nuclear-powered submarine will be limited to the non-nuclear parts of the vessel, as the design and manufacture of the nuclear plant will be entirely in the Brazilian Navy's hands.
The Brazilian deal strengthens DCNS' position in Latin America, which had been the preserve of the German shipbuilding industry for decades. But since 1997 DCNS has sold ships to Chile, Venezuela and Ecuador and now Brazil, allowing CEO Jean-Marie Poimboeuf to retire in a few weeks in the glow of one of his company's best-ever deals.
“We are extremely pleased with the decision taken by Brazil's highest authorities in favour of DCNS,” he said in a statement. “This success confirms our group's capacity to be a prime contractor as well as its technological value and its competitiveness on the export market. It is a significant contribution to our engineering and production activities. The majority of the group's centres are concerned, most notably Cherbourg and Lorient.”