Germany is considering abandoning its flagship €100 billion future combat jet project with France and joining a rival programme with Britain instead, The Times has been told.
As an overture to a potential deal, the German chancellor is also understood to be in talks over lifting Berlin’s veto on a delivery of Eurofighter Typhoon jets to Saudi Arabia, which the UK views as an important strategic priority.
A pact along these lines would be a significant coup for London and reflect a steadily worsening rift between France and Germany, which are at odds over issues from energy and air defence to diplomatic protocol.
The jet fighter question leaves Olaf Scholz with a series of difficult choices that will shape his country’s alignment in Europe and beyond.
The first is whether to stick with the Future Combat Air System (FCAS), a blockbuster Franco-German-Spanish programme to develop and build the next generation of air power, billed by some analysts as the most important defence project in Europe.
The central idea is to digitally interlace a new brand of stealth fighter with drones, automated swarms of mini-fighter jets, older combat aircraft and even naval or ground-based assets through a single high-tech platform.
Berlin alone has already earmarked €40 billion of investment for FCAS and it is supposed to come on to the market by 2040. However, the scheme has been mired in delays and disputes over design and financing.
Sources familiar with Scholz’s thinking say he is worried that the project is at risk of turning into an extravagantly expensive white elephant and falling behind its competitors. The US air force and navy each expect to field their own new varieties of sixth-generation jet by 2030.
In the UK, BAE Systems and Rolls Royce are leading the development of a stealth fighter known as the Tempest, which is scheduled to be ready by 2035 and will form the backbone of a broader British-Italian-Japanese aerospace alliance.
One senior German official said Scholz saw no point in FCAS competing with Tempest and wanted either to merge the two or, failing that, to jettison FCAS and join Tempest. The chancellor is also said to be exasperated by the preferential treatment France has given its own aerospace companies in the initial stages of the FCAS project.
The ill feeling is exacerbated by a wider souring of relations between France and Germany on a number of different policy fronts.
Paris has, for example, snubbed Scholz’s “Sky Shield” initiative to bundle together European countries’ air and missile defence procurement, because it regards Germany’s preference for “off the shelf” systems from countries such as the US and Israel as an affront to its own research and development in this domain.
“When France says European defence policy, it means French industrial interests,” a senior source in Germany’s ruling coalition said. “Scholz feels he has far more in common with the British than with the French on these issues.”
However, the source added that Scholz was peeved that Rishi Sunak had yet to visit him in Berlin and wanted to see significantly more direct engagement from figures at the top of the British government over strategic questions if a closer UK-German partnership is to become a reality.
British officials note that Sunak appeared at the Munich security conference in February and has held five phone calls and four face-to-face meetings with Scholz on the sidelines of various international summits this year.
The next-generation combat aircraft decision is closely linked to a British-German wrangle over a delivery of 48 Eurofighter Typhoon jets to Saudi Arabia, in a package potentially worth more than £5 billion.
The jet aircraft are jointly manufactured by Britain, Germany, Spain and Italy, which means Berlin has the ability to block their export. It has done so up to now on the grounds that a Saudi-led coalition has been blamed for killing thousands of civilians in the Yemeni civil war.
In September this newspaper reported that Sunak and James Cleverly, the British foreign secretary, were at the heart of a concerted lobbying campaign to try to shift Germany’s position.
The UK regards Saudi Arabia as a valuable partner in efforts to stabilise the Middle East and hopes the sale will safeguard thousands of jobs at the BAE Systems factories that manufacture Eurofighter components and assemble the jets. The matter is expected to come to a head in the next few weeks, after Saudi Arabia heaped pressure on the UK and Germany by inviting France to set out a rival offer to deliver its own Dassault Rafale fighter aircraft.
Sources across Scholz’s three-party coalition say they are now increasingly confident that the Eurofighter sale will be unblocked in the near future. This is partly because the chancellor worries that prospective partners will shy away from entering multinational defence projects with Germany in future if it is seen to be single-handedly thwarting exports.
Berlin is also conscious that the jet’s manufacturers, including Airbus in Germany, need the extra orders to protect jobs and keep their industrial capacity ticking over. A fortnight ago Guillaume Faury, Airbus’s chief executive, took the unusual step of explicitly criticising the German government for blocking the Eurofighter deal, describing its restrictive approach to arms exports as a “serious problem” and “very negative”.
Faury also argued that it raised questions about whether allies could treat Germany as a “trustworthy partner”. However, there are two factors complicating the decision for Scholz. The first is that there is still some opposition to the deal within his coalition, primarily from sections of the Green Party but also from a number of MPs in the chancellor’s own Social Democratic Party.
One MP in the coalition said that leading figures on the Green’s Realo [pragmatist] wing such as Robert Habeck, the vice-chancellor and business minister responsible for arms export controls, wanted to lift the veto. However, other influential Green politicians continue to argue that sending arms to Saudi Arabia is not only immoral but dangerous, because those weapons could one day be used against the West’s interests.
The second problem is the Israel-Hamas conflict. Germany has positioned itself squarely on Israel’s side and sources say the government would prefer to wait and see how Saudi Arabia positions itself before Berlin takes any decision on weapons deliveries.
The relationship between Britain, France and Germany, western Europe’s three foremost military powers, is coming to resemble one of the unfortunate love triangles from nouvelle vague cinema (Oliver Moody writes).
Paris and Berlin, like a wearily long-married couple, have gone from renewing their vows and embarking on expensive joint projects to ritualised bickering and mutual backbiting.
Once French presidents and German chancellors used to hold hands in public and help each other out in domestic elections. Now they squabble over everything from nuclear reactors and missile defence to the choreography of China trips and shared cabinet meetings.
Notionally the pair are committed to working together on two swishy advanced weapons projects — the Main Ground Combat System (MGCS) tank and the Future Combat Air System (FCAS) jet — that are meant to provide the backbone of the continent’s future armed forces.
But Germany’s eye is straying as the chancellery becomes increasingly exasperated with what it sees as France’s inordinately jealous coddling of its own defence industry.
First Berlin hinted a few weeks ago that it was thinking about upping sticks and developing a next-generation tank with Italy, Spain and Sweden instead. Now it is signalling that it could join Britain, Italy and Japan’s fighter jet programme too.
Allies of Olaf Scholz, the German chancellor, say he regards the UK as a more straightforward partner on this issue than France, but also feels slighted and frustrated by the lack of high-level engagement from London — and in particular by Rishi Sunak’s failure to visit him in Berlin.
Ultimately, though, the strongest driving force here is not so much amour-propre or schadenfreude as the logic of industrial consolidation. Germany is understood to see little point in European states pouring tens of billions into competing marquee defence projects when they could more efficiently join forces instead.
