Indonesia Inks Memorandum of Understanding for F-15EX Purchase

During a visit to Boeing’s St. Louis factory,  Indonesia’s Minister of Defense, Prabowo Subianto, signed a Memorandum of Understanding (MoU) to acquire up to 24 F-15EX combat aircraft.

Indonesia is in the midst of a recapitalization of its combat aircraft fleet. The country retired its legacy F-5E/F Tigers and has opted for a two-pronged approach to modernizing its inventory. This involves the procurement of the Dassault Rafale and now, most likely, the Boeing F-15EX.

Initially, the Indonesian Air Force and Defense Ministry favored acquiring the Russian-built Sukhoi Su-35 as the F-5 replacement. The Su-35 acquisition was to involve the procurement of 11 of the fighters at a cost of $1.14 billion under a cash and commodity deal (items such as palm oil, coffee, tea, and rubber were offered up by Indonesia). An announcement of the pending agreement came on February 14, 2018. Because the TNI-AU has operated a mixed Sukhoi fleet of Su-27s and Su-30s since 2003, the more advanced Su-35 variant presented a logical successor.

However, due to Indonesian concerns about U.S. CAATSA (Countering America’s Adversaries Through Sanctions Act) legislation regarding defense and/or intelligence-related transactions with Russia, this agreement was ultimately dropped.

In place of the aborted Su-35 buy, the Indonesian MoD concurrently pursued two alternatives to replace its F-5 fleet: the Dassault Rafale and the Boeing F-15EX Advanced Eagle.

While Indonesia has already pulled the trigger on a Rafale order – placing an initial order for six fighters in February 2022, then picking up an option for 18 more on August 10 – the F-15EX acquisition has remained outstanding.

One reason for the lack of a firm order may be the Indonesian Defense Ministry’s finances. With a defense budget of under $9 billion – equal to about 0.6 percent of GDP – the lack of capitalization bandwidth may preclude simultaneous buys of modern combat aircraft.

However, the more likely explanation is the need to balance finances, infrastructure requirements, pilot and crew training, and the transition away from older fighter models to new ones. This would entail synchronizing delivery timelines in order to ensure operational use once new fighters are delivered and brought into service.

Despite various contradictory comments and reports regarding whether Indonesia would pick one or the other between the Rafale and the F-15EX, or opt for both, the latest MoU appears to indicate the latter option is the favored course.

Interestingly, the same day as the first batch Rafale contract was signed (February 10, 2022), the U.S. State Department announced that it had cleared a potential government-to-government Foreign Military Sale (FMS) to Indonesia of up to 36 F-15ID (Indonesian designation for the EX variant) jet fighters. The proposed FMS deal came with an estimated price tag of $13.9 billion once all associated equipment (minus missiles) was factored in. A report in Reuters on November 21, 2022, indicated that negotiations for a procurement of F-15IDs were in advanced stages and awaiting final signoff from the government.

Now it appears the final corner has been turned.

Daniel Darling
VP Market Insights at Forecast International | Website | + posts

Dan Darling is Forecast International’s director of military and defense markets. In this role, Dan oversees a team of analysts tasked with covering everything from budgeting to weapons systems to defense electronics and military aerospace. Additionally, for over 17 years Dan has, at various times, authored the International Military Markets reports for Europe, Eurasia, the Middle East and the Asia-Pacific region.

Dan's work has been cited in Defense News, Real Clear Defense, Asian Military Review, Al Jazeera, and Financial Express, among others, and he has also contributed commentary to The Diplomat, The National Interest and World Politics Review. He has been quoted in Arabian Business, the Financial Times, Flight International, The New York Times, Bloomberg and National Defense Magazine.

In addition, Dan has made guest appearances on the online radio show Midrats and on The Media Line, as well as The Red Line Podcast, plus media appearances on France 24 and World Is One News (WION).

About Daniel Darling

Dan Darling is Forecast International’s director of military and defense markets. In this role, Dan oversees a team of analysts tasked with covering everything from budgeting to weapons systems to defense electronics and military aerospace. Additionally, for over 17 years Dan has, at various times, authored the International Military Markets reports for Europe, Eurasia, the Middle East and the Asia-Pacific region. Dan's work has been cited in Defense News, Real Clear Defense, Asian Military Review, Al Jazeera, and Financial Express, among others, and he has also contributed commentary to The Diplomat, The National Interest and World Politics Review. He has been quoted in Arabian Business, the Financial Times, Flight International, The New York Times, Bloomberg and National Defense Magazine. In addition, Dan has made guest appearances on the online radio show Midrats and on The Media Line, as well as The Red Line Podcast, plus media appearances on France 24 and World Is One News (WION).

View all posts by Daniel Darling →