GRS 379
PHER CAT/A
RESTRICTED
RECEIVED IN
la
46
REGISTRY No. 51
5 APR 1974
CPA wide Woodied areinaft
FM HONG KONG 040800Z
RESTRICTED
HKK 21/12
1974
TO ROUTINE E C G D TELEGRAM NUMBER EXCED 8 OF 4 APRIL AND TO D OF T INFO F C O (FOR STUART, HKIOD AND CLOAKE, EPD),
CP A SIMULATOR
1. C PA ARE NOW STARTING NEGOTIATIONS FOR SIMULATOR FOR TRI
STAR FOR WHICH, AS YOU KNOW, THEY GET SOME CREDIT FROM LOCKHEED
AGAINST TRI STAR PURCHASE PRICE. THEY ARE TYPICALLY TRYING
TO GET IT AS CHEAPLY AS POSSIBLE. CANDIDATES IN THE FIELD ARE
LINK, C A E ELECTRONICS (CANADA) AND REDIFON.
2. LATTER ARE ALREADY NEGOTIATING FOR SALE OF VISUAL DISPLAY TO BE USED WITH EXISTING 707 SIMULATOR (MADE BY JAPANESE). THE
VISUAL COULD ALSO BE USED WITH THE TRI STAR SIMULATOR,
V
3. MR ROBERTSON CHIEF EXECUTIVE OF REDIFON ON A BRIEF VISIT HERE HAS BEEN TOLD BY CP A THAT THEY WOULD LIKE TO HAVE THE REDIFON SIMULATOR AND BEEN ASKED TO QUOTE BUDGET PRICE. HE HAS QUOTED £1.5 MILLION EXCLUSIVE OF THE VISUAL DISPLAY FOR WHICH THE BUDGET PRICE IS £2 MILLION. THESE MAY HAVE TO BE CONCLUDED AS SEPARATE CONTRACTS BECAUSE THE VISUAL MIGHT DE SUPPLIED IN ANY CASE FOR THE EXISTING SIMULATOR.
4. CPA HAVE PRESSED REDIFON TO TRY TO GET 6 PERCENT ON E C G D TERMS FOR SIMULATOR AND VISUAL ON THE GROUNDS THAT THEY OBTAINED THIS FOR THE ROLLS ROYCE ENGINES. ROBERTSON IN TURN HAS APPROACHED ME ON THIS. I HAVE TOLD HIM THAT I DO NOT RATE CHANCES HIGH AND THAT THE ROLLS ROYCE ENGINES' DEAL (WHATEVER IT IS) CANNOT BE TAKEN AS A PRECEDENT BECAUSE IT WAS FIRST ENTERED UPON BEFORE CHANGE IN E C G D BEST RATE. I HAVE ALSO MADE THE POINT THAT WHATEVER RATE IS GIVEN FOR SIMULATOR OR VISUAL MIGHT BE REGARDED AS A PRECEDENT FOR THE OTHER. HE RECOGNISES THIS BUT FEARS THAT IF BEST POSSIBLE RATE IS NOT GIVEN THE CONTRACT MAY BE LOST. IN PARTICULAR HE IS AFRAID THAT THE CANADIANS WILL UNDERCUT ON INTEREST RATES.
/5. THERE
RESTRICTED