March 17, 2015 By Burak Ege Bekdil – Defense News

ANKARA — Turkish defense electronics specialist Aselsan, the country's biggest defense company, on Monday inaugurated a $157 million plant in Golbasi near Ankara.

The plant will specialize in radars and electronic warfare (EW) suites for land, air, naval, space and unmanned platforms, the company said.

The new plant, first planned in 2012, will feature integration and test fields and specialize in module designing and production for radar and EW systems.

The inauguration ceremony was attended by Turkish President Recep Tayyip Erdogan, Prime Minister Ahmet Davutoglu, Defense Minister Ismet Yilmaz and chief of the General Staff Gen. Necdet Ozel.

Speaking at the ceremony, Yilmaz said that a particular speciality of Aselsan's new production facility will be to produce "modules which are one of the fundamental parts of radar and electronic warfare systems whose procurement from foreign sources depend on strict restrictions."

Hasan Canbolat, Aselsan's board chairman, said the plant marks the fact that Turkey is one of the few countries that does not rely on foreign technology in radars and EW suites.

He said that Aselsan alone accounted for 34 percent of the research and development activity across Turkey's defense industry. Aselsan has invested in five plants in and outside Turkey over the past three years.

Feb 26 2015 trdefence.com (WorldBulletin)

Turkey is pressing ahead with talks with U.S. and European firms over its first long-range missile defence system, as the preferred Chinese bidder has yet to meet all requirements for the multi-billion dollar project, two officials said on Thursday.

NATO member Turkey chose China Precision Machinery Import and Export Corp in 2013 as the preferred candidate for the $3.4 billion deal, prompting U.S. and Western concern about security and the compatibility of the weaponry with NATO systems.

Turkey’s defence minister said last week it did not plan to integrate the system with NATO infrastructure, only for the presidential spokesman to say days later that the systems would be integrated.

One of the defence officials told Reuters on Thursday there were still question marks over the Chinese proposal, particularly around “technology transfer” to boost the Turkish defence industry.

“Contacts on this issue are continuing. Securing technology transfer is one of the most important subjects in the tender and on this subject a full guarantee has not been provided,” the official said.

U.S. and NATO representatives were unhappy with Turkey’s choice of China Precision Machinery, which has been under U.S. sanctions for selling items to Iran, Syria or North Korea that are banned under U.S. laws to curb the proliferation of weapons of mass destruction.

FRENCH CONNECTION

Turkish defense contractor Aselsan and French defense contractor Thales on Thursday agreed to install Thales-made Lightweight Multi-role Missiles on Turkish Aselsan’s launch-pad, the companies said in a joint statement released on Thursday.

Aselsan is known for its products in military communications and weapons systems. Thales is one of largest defense electronics contractors in the world with its revenue exceeding $16 billion in 2014.

The two companies have been working together since 2010, and have completed a long period of trials for the missiles and the launcher.

The agreement opens the way for more cooperation between the two companies, the statement said.

In addition to bids from the U.S. firm Raytheon Co and the Franco-Italian group Eurosam, the officials told Reuters that Russia, eliminated in the first stage of the tender, was still keen on providing a surface-to-air missile system – a prospect that could also raise concerns in NATO.

Eurosam, which is owned by the multinational European missile maker MBDA and France’s Thales, came second in the tender. U.S.-listed Raytheon Co also put in an offer with its Patriot missile defence system, which is now operated by 13 countries around the world.

One of the officials said defence representatives had gone to Italy at the end of January for talks with Eurosam.

“In March, a delegation will go to the United States for talks with the other bidder. Finally, a delegation will go to China and hold talks there,” he said.

The sources said Russia had renewed its interest in the project. Officials previously said Russia had revised an initial bid and offered to sell Turkey its S-400 medium- to long-range anti-aircraft missile system.

However Turkey is not currently holding talks with the Russians.

Mar. 31, 2014 - By BURAK EGE BEKDIL  - Defense News

ANKARA — Turkish officials, increasingly wary of a controversial decision in September to select a Chinese company to construct the country’s first long-range air defense system, might consider a more time-consuming but entirely local option for the program.

A senior procurement official said he could not rule out the possibility.

“I think Aselsan has the essential capabilities for [the long-range air and anti-missile system]. This may be a challenge, but not something unattainable,” the official said.

Government-controlled military specialist Aselsan is Turkey’s biggest defense company.

But a second procurement official was more skeptical.

“A preliminary study ... says that it may take no less than 14 years for Aselsan to deliver the system,” he said. “And that’s an optimistic guess.”

An Aselsan official, speaking on condition of anonymity, admitted that his firm would be keen to set out for the job. “An altogether local solution would earn Turkey extremely strategic capabilities it may need for future programs in air defense.”

As for the risk of belated deliveries, he said: “Our development and production efforts may not come sooner than existing foreign options, but there are no guarantees any foreign option will not produce unexpected delays, either.”

Both the government and Aselsan have come under pressure from NATO allies to rethink a September decision to award the US $3.44 billion air defense contract to China Precision Machinery Import-Export Corp. (CPMIEC).

Turkey’s Western allies have said if Turkey finalizes the deal with the Chinese manufacturer, its entire defense cooperation with Western counterparts, including defense and non-defense companies, could be jeopardized.

The Chinese contender defeated a US partnership of Raytheon and Lockheed Martin, offering the Patriot air defense system; Russia’s Rosoboronexport, marketing the S-300; and the Italian-French consortium Eurosam, maker of the Aster 30.

Turkish officials said if contract negotiations with CPMIEC fail, talks would be opened with the second-place finisher, Eurosam. Next in line would be the US bidder. The Russian option was eliminated.

This year, the Turkish government asked the European and US contenders to make new bids by April 30.

The Turkish program consists of a radar system, launcher and interceptor missiles. It has been designed to counter enemy aircraft and missiles. Turkey has no long-range air defense systems.

About half of Turkey’s network-based air defense picture has been paid for by NATO. The country is part of NATO’s Air Defense Ground Environment. Without NATO’s consent, it will be impossible for Turkey to make the planned Chinese system operable with these assets, some analysts say.

But NATO and US officials have said any China-built system could not be integrated with Turkey’s joint air defense assets with NATO and the United States. They also have warned that any Turkish company that acts as a local subcontractor in the program would face serious US sanctions because CPMIEC is on a US list of companies to be sanctioned under the Iran, North Korea and Syria Nonproliferation Act.

In December, Aselsan, potentially CPMIEC’s main Turkish partner in the contract, became the first casualty of US sanctions when Bank of America Merrill Lynch, a US investment firm, pulled out of a joint bid to advise Aselsan on the company’s second listing on Istanbul’s stock exchange, citing Turkey’s contract talks with CPMIEC.

Further talks with two other international banks, Barclays and Goldman Sachs, also have failed. Another Aselsan official said the second listing was not “on hold.”

Both procurement officials said the government is interested in further assessing whether a solution based on Aselsan’s local work would be a good idea. But such a decision would come from the top government levels, and it would await political calm after elections.

Turkey’s embattled government, fighting a series of scandals over fraud and undemocratic practices in the country’s judiciary system, is facing a strong challenge from opposition parties in local elections. Observers agree the polls would be a confidence vote on Prime Minister Recep Tayyip Erdogan’s government, and that the results may force early parliamentary elections this year.

A Feb. 25 meeting of the Defense Industry Executive Committee, which is chaired by Erdogan and oversees top procurement decisions, was indefinitely put off due to political turmoil.