August 17, 2020 | International, Aerospace, Naval, Land, C4ISR, Security
By: Mike Yeo
MELBOURNE, Australia — South Korea has over the past decade become a defense industry powerhouse in its own right, and it's seeking to widen its reach, with progress in international markets in recent years marking the maturity of its defense articles.
This year's Defense News Top 100 list of the biggest defense companies in the world features four South Korean businesses. They are Hanwha (ranked 32rd), Korea Aerospace Industries (55th), LIG Nex1 (68th) and Hyundai Rotem Company (95th), all of which made last year's list.
Continued reform
The strong performance of South Korean defense companies comes in the wake of a series of reforms over the past decade, with the latest designed to consolidate industrial gains and create momentum for growth.
The defense industry reforms are part of President Moon Jae-in's Defense Reform 2.0 program announced in 2018 — a complement to efforts seeking to create a slimmer, yet more efficient South Korean military that is less reliant on foreign defense technology.
The push for further self-reliance is most prominent in Korea Aerospace Industries' KF-X program. KAI is developing a next-generation fighter for the South Korean Air Force. Although an American GE F414 turbofan will power the aircraft, its avionics will primarily be indigenous. These include the active electronically scanned array radar under development by Hanwha and the country's Agency for Defense Development, with support and some components supplied by Israel's Elbit Systems.
Defense Reform 2.0 also puts emphasis on defense industry investment, and it comes as little surprise that the domstic market still takes up the biggest share of the pie where sales are concerned, backed up by the steady growth in defense spending: South Korea's defense budget grew 20 percent from 2009 to 2017, reaching $43 billion.
Export success
The reform program also places an increased priority on defense exports. The country is already successful in this area, with research by the Stockholm International Peace Research Institute think tank showing the country was the 11th biggest arms supplier in the world in 2017, with sales totaling $5.5 billion.
In a further indication of how much South Korea's industry has grown, SIPRI also noted in a 2018 report that the country's defense exports grew 94 percent in the 10 years prior, a growth figure only bettered by Turkey for the same period.
This growth has been underpinned by two of the highest-profile South Korean defense exports in the past decade: the KAI T-50 Golden Eagle family of trainer and light combat aircraft, and the Hanwha K9 Thunder self-propelled howitzer.
The T-50 was earmarked by the Air Force as its mainstay advanced trainer and light combat aircraft. Despite losing a number of trainer competitions, including in Poland, Singapore and the United States, the Golden Eagle has since scored a number of notable contracts for export.
Compared to its rivals in the trainer market, such as the Leonardo M-346 and the Boeing T-7, the main draw of the T-50 family is its combat capability in the form of the TA-50 and FA-50 equipped with sophisticated combat capabilities in the form of radars and precision weapons employment capability. This makes the aircraft attractive to nations unable to afford a high-end trainer with a light attack capability, and the list of the type's customers bears this out, with Indonesia, Iraq, the Philippines and Thailand operating the type in their respective air forces. The Philippine Air Force used its FA-50PH fleet to attack Islamic State militants in the southern part of the country in 2018.
Meanwhile, Hanwha's K9 Thunder has carved a niche for itself in the global market for self-propelled howitzers. The 52-caliber, 155mm system has been selected by a number of NATO nations, beating out the similar Panzerhaubitze 2000 by Germany's Rheinmetall in Estonia, Finland and Norway. Turkey is building the K9 under license as the T-155 Firtina.
The system has also been selected for license production by India and Poland, and had previously been selected by Australia in the early part of the 2010s only to be canceled following budget issues caused by the global financial crisis.
Hanwha is also one of two companies left in the running to supply the Australian Army with a new infantry fighting vehicle. The AS21 Redback, which is based on the K21 vehicle operated by the South Korean Army, is to take part in an evaluation program against the Rheinmetall KF41 Lynx to supply 450 vehicles to replace M113 armored personnel carriers.
The evaluation will see three of each vehicle delivered to Australia for testing, with the first two Redbacks due to reach Australia at the end of August, having left South Korea by ship late last month.
Post-pandemic support
Like much the rest of the world, the COVID-19 pandemic has hit South Korea hard, though the worst appears to be over for the country. The local defense industry was forced to adjust financially and operationally, and it remains unclear how revenue will be hit by the events of 2020.
The pandemic has claimed at least one sale for the South Korean defense industry, with Argentina, which had appeared set to be the next customer for the T-50 family, deciding in April to put off the acquisition indefinitely. The South American country is yet to sign a contract, despite choosing the aircraft for purchase in July 2019.
However, the South Korean government is not waiting for foreign action. Defense Minister Jeong Kyeong-doo has unveiled plans for the country to spend more on locally produced defense articles, partly as a move to help curtail the effects of the pandemic.
Jeong said during a mid-June meeting with industry CEOs that his ministry plans to adjust spending plans to continue its drive to spend more on indigenous products, and move delivery timelines to reflect the reality of schedule delays while also waiving penalties for late payments.
He also plans to expand an existing strategy aimed at establishing “defense industry innovation clusters”; this move adds to the first one established in April with an initial government investment. As a result, more funding will be made available to industry and research institutes, and will be used to support regional collaboration in defense-related research and development as well as manufacturing.
August 1, 2022 | International, Naval
Four unmanned surface vessels are operating at RIMPAC -- and the lessons they generate will inform the path to a Large USV program of record in the next three years, and help determine if there's a future for a Medium USV.
July 26, 2019 | International, Aerospace, Naval, Land, C4ISR, Security, Other Defence
DEFENSE LOGISTICS AGENCY GSL Solutions Inc., Vancouver, Washington, has been awarded a maximum $450,000,000 firm‐fixed‐price, indefinite‐delivery/indefinite‐quantity contract for automated pharmaceutical equipment, accessories, maintenance and training under the Patient Monitoring and Capital Equipment Program. This is a five-year base contract with one five‐year option period. This was a competitive acquisition with 36 responses received. Location of performance is Washington, with a July 23, 2024 performance completion date. Using customers are Army, Navy, Air Force, Marines and federal civilian agencies. Type of appropriation is fiscal 2019 through 2024 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania (SPE2D1‐19‐D‐0016). Crown Clothing Co., Vineland, New Jersey, has been awarded a maximum $12,386,162 modification (P00009) exercising the first one-year option period of a one-year base contract (SPE1C1-18-D-1079), with four one-year option periods for men's coats and replacement collars. This is a fixed-price contract. Location of performance is New Jersey, with an Aug. 8, 2020, performance completion date. Using military service is Marine Corps. Type of appropriation is fiscal 2019 through 2020 defense working capital funds. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania. FN America LLC, Columbia, South Carolina, has been awarded a maximum $10,589,029 firm-fixed-price contract for receiver cartridges. This was a competitive acquisition with two responses received. This is a five-year contract with no option periods. Location of performance is South Carolina, with a July 26, 2024, performance completion date. Using military service is Army. Type of appropriation is fiscal 2019 through 2024 Army working capital funds. The contracting activity is the Defense Logistics Agency Land and Maritime, Warren, Michigan (SPRDL1-19-D-0112). Communications & Power Industries, Palo Alto, California, has been awarded a maximum $7,050,384 firm-fixed-price contract for electron tubes. This was a sole-source acquisition using justification 10 U.S. Code 2304 (c)(1), as stated in Federal Acquisition Regulation 6.302-1. This is a three-year contract with no option periods. Location of performance is California, with a June 23, 2022 performance completion date. Using military services are Army, Navy, Air Force and Marine Corps. Type of appropriation is fiscal 2019 through 2021 defense working capital funds. The contracting activity is Defense Logistics Agency Land and Maritime, Columbus, Ohio (SPE7LX-19-D-0169). NAVY Data Link Solutions LLC, Cedar Rapids, Iowa, is awarded a maximum potential value $62,300,000 modification to a previously awarded indefinite-delivery/indefinite-quantity multiple award contract (N00039-15-D-0042) for the Block Upgrade II retrofit of Multifunctional Information Distribution System (MIDS) low volume terminals. The terminals provide secure, high-capacity, jam-resistant, digital data and voice communications capability for Navy, Air Force and Army platforms. Work will be performed in Wayne, New Jersey (50%); and Cedar Rapids, Iowa (50%). Work is expected to be completed by December 2026. No funding is being obligated on the contract at the time of award. Contract actions will be issued and funds obligated as individual delivery orders are issued. This contract modification was not competitively procured because it is a sole source acquisition pursuant to the authority of 10 U.S. Code 2304(c)(1) - only one responsible source (Federal Acquisition Regulation, subpart 6.302-1). The Naval Information Warfare Systems Command, San Diego, California, is the contracting activity and awarded the contract on behalf of the MIDS Program Office. Lockheed Martin Rotary and Mission Systems, Manassas, Virginia, is awarded a $27,425,442 for firm-fixed-price delivery order N00024-19-F-5632 under previously awarded contract N00024-15-D-5217 for 165 Technical Insertion Sixteen (TI-16) Common Display System (CDS) Variant A water-cooled production consoles. The CDS is a set of watch station consoles designed to support the implementation of Open Architecture in Navy combat systems. The TI 16 CDS is the next evolution in the CDS family and consists of a three-eyed horizontal display console. This delivery order combines purchases for the Navy (85%); and the government of Japan (15%) under the Foreign Military Sales (FMS) program. Work will be performed in Johnstown, Pennsylvania, and is expected to be complete by March 2020. Fiscal 2018 other procurement (Navy); fiscal 2014, 2016 and 2017 shipbuilding and conversion (Navy); and FMS Japan funding in the amount of $26,935,062 will be obligated at time of award and will not expire at the end of the current fiscal year. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity. ARMY Baysinger-Bric JV,* Marion, Illinois (W91248-19-D-0005); Johnson-McAdams Firm P.A.,* Greenwood, Mississippi (W91248-19-D-0004); and American Engineers Inc.,* Glasgow, Kentucky (W91248-19-D-0006), will compete for each order of the $15,000,000 firm-fixed-price contract for architect and engineering design services that include preparation of designs, plans, specifications and cost estimates for various projects at Fort Campbell, Kentucky; and Fort Sill, Oklahoma. Bids were solicited via the internet with three received. Work locations and funding will be determined with each order, with an estimated completion date of July 31, 2024. U.S. Army Mission Installation Contracting Command, Fort Campbell, Kentucky, is the contracting activity. *Small Business https://dod.defense.gov/News/Contracts/Contract-View/Article/1915574/
May 1, 2020 | International, Aerospace
DALLAS, April 30, 2020 /PRNewswire/ -- Lockheed Martin (NYSE: LMT) received a $6.07 billion contract from the U.S. Army for the production of Patriot Advanced Capability-3 (PAC-3) Missile Segment Enhancement (MSE) interceptors and associated equipment, to be delivered across FY21, FY22 and FY23 contract years. The contract calls for the production and delivery of PAC-3 MSE interceptors, launcher modification kits, associated equipment and non-recurring efforts to support the United States and global customers. "This contract demonstrates our customer's continued confidence in our ability to deliver unmatched Hit-to-Kill technology that defeats the ever-expanding global threats of today and tomorrow," said Scott Arnold, vice president, Integrated Air & Missile Defense at Lockheed Martin Missiles and Fire Control. "PAC-3 MSE is one of the most capable multi-mission interceptors, enabling our customers to defend against advanced tactical ballistic missiles, cruise missiles and aircraft." To meet customer demand and increase production capacity, Lockheed Martin is currently building an 85,000-square-foot expansion at the Camden, Arkansas, facility where PAC-3 MSE interceptors are assembled. The building is expected to be complete by fourth quarter 2021, with operations beginning in first quarter 2022. Ten nations – the United States, Qatar, Japan, Romania, Poland, the United Arab Emirates, Sweden, Korea, Bahrain and Germany – have signed agreements to procure PAC-3 MSE interceptors. For additional information, visit our website. About Lockheed Martin Headquartered in Bethesda, Maryland, Lockheed Martin is a global security and aerospace company that employs approximately 110,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services. SOURCE Lockheed Martin https://news.lockheedmartin.com/2020-04-30-U-S-Army-Awards-6-07-Billion-Contract-to-Lockheed-Martin-for-PAC-3-MSE-Production-Associated-Equipment