KAI Named Priority Bidder

Indonesia notifies airplane maker priority rights to bid to supply its T-50 supersonic trainer jets


(L)Korea Aerospace Industries?T-50 Golden Eagle supersonic trainer jets in formation flights.(R)A T-50 Golden Eagle supersonic trainer jet seen during take off at an airport in Korea.

Korea Aerospace Industries (KAI) has been named the priority bidder by the Indonesian Defense Ministry on April 12 for its plan to beef up its air force by importing KAI's T-50 supersonic trainer jet aircraft Golden Eagle, KAI officials said recently.
KAI is entitled to hold sales talks with the Indonesian Defense Ministry for 16 of its trainer aircraft worth some $400 million, which would be the largest deal that KAI ever signed and it is expected to open the way for other foreign countries to import the Korean-made trainer jet aircraft in the future.
To win the priority bidding rights, KAI got information on Indonesia's plan to import high-capacity jet trainer planes in 2008 and gave briefings on its T-50 jet trainer in May 2008 and January 2010 to the Indonesian Air Force. In April 2010, Indonesian air force personnel visited Korea to test fly the trainer aircraft and expressed their satisfaction with the planes?capabilities. In May 2010, KAI submitted its bidding papers to the Indonesian Defense Ministry and the T-50 jet trainer passed the initial round, along with Russia? Yak-130 and the Czech Republic's L-159.
In November 2010 at the TEP meeting, a favorable climate was created for T-50 planes, which was followed by the Korea-Indonesia Summit held in Bali, Indonesia, in December, which further boosted the odds for T-50 jet trainers to be named as the model that the Southeast Asian country? air force will import.
The official contract is to be signed after two to three months of negotiations on technology matters and details of the contract, certainly before the first half is over, the KAI officials said.
They feel that the negotiations will go smoothly, as fully detailed discussions took place before the T-50 trainer aircraft was selected as one of the candidate planes.
The KAI officials see many advantages to come from the selection of the T-50 plane -- in particular, the worldwide publicity. It is particularly impressive as Indonesia turned to airplane makers other than Russian airplane makers, whose planes the Southeast Asian country has been buying because they favor their aviation weapons system. KAI also sees the possibility increasing for cracking the high-quality trainer airplane markets in the former communist states in Eastern Europe.
By securing Indonesia as a customer for its jet trainer, KAI sees the possibility for the sale of the plane to such countries as Poland, Israel and even the United States, boosting the confidence in the aircraft manufacturing industry in Korea as it will be shoulder-to-shoulder with those in advanced countries.
Korea would become only the sixth country in the world to export supersonic jet fighter trainer planes, confirming its integrated technologies in such areas as design, parts production, complex materials, assembly and trial evaluation. The export of one T-50 jet trainer has the same value as the export of 1,000 cars, creating high economic value to the country. When the export of 16 T-50s to Indonesia is realized, it will create $6.5 billion worth of productivity in value, $1.7 billion in value-added portion and it will create 7,700 new jobs. The deal will also lead to boosting the development and operation of the cooperative firms for the aircraft industry in Korea. The small- and mid-sized cooperative firms will share $1.5 billion in the total export value of the T-50 trainer planes, or 38 percent of the total export value. A total of 70 cooperative firms employing 1,700 workers will join the production of the trainer fighter planes for shipment to Indonesia, raising the localization ratio of the aircraft to 61 percent.
The strong advantages of the T-50 jet trainer plane are numerous: It can fly at a maximum speed of mach 1.5 controlled by digital flight control systems; it is considered the right model of jet trainer for flying such fourth-generation jet fighters as the F-15, F-22 and F35; and it can carry air-to-air missiles (AIM-9), air-to-ground missiles (AGM-65) and JDAM guided bombs as well as undertake light attack missions.
According to results of test flights by the Korean air force in its training programs, the T-50 trainer jet saves some 20 percent of the flight time compared to the existing jet trainer planes, 30 percent in cost savings and a 40 percent boost in training effects.
The planes have yet to reveal a problem, even after 31,000 hours of flight time by the Korean air force since 2005 for its training program. The jet trainer-model plane boosted the operational effect and is satisfactory to market demands, as it was the first supersonic trainer plane produced for an improved aircraft supply support system and training system at the same time. The T-50 Supersonic Jet Trainer has bright export prospects, as most of the jet trainer planes in use around the world have been in use since the late 1970s, making them old and in need of replacement beginning in the early 2000. The market for the jet trainer aircraft is projected to be about 3,000 planes from 2005 to 2030 from some 60 countries, replacing the T-38, F-5, Hawk, Alpha Jet and A-4, among others.
KAI projects it will be able to secure more than 30 percent of the 3,000 new jet trainers needed, as it will promote the export of the planes jointly with Lockheed Martin through a joint task force team targeting such countries as Poland, Israel, the Middle East, the United States and Europe.
KAI was launched in October 1999 by integrating the aircraft manufacturing units of Samsung, Hyundai and Daewoo groups as the only Korean maker of complete airplanes. The company already produced such military planes as the KT-1, T-50, KUH and has exported KT-1 to Indonesia and Turkey.
The company has been exporting major structural parts of large civil passenger aircraft and in strategic tieups with both Boeing and Airbus has been participating in the joint development of next-generation civil aircraft such as the A350, and the B787 as a tier 1 cooperative firm.
With a head office in Sacheon, South Gyeongsang Province, the company has two business heads, the Daejeon R&D Center and Seoul Office with 2,950 employees out of which 1,350, or 40 percent, are aviation engineers with the capabilities to engage in the development of aircraft.
KAI recorded 1.2667 trillion won in turnover last year with 121 billion won in operating profit, posting more than 50 billion won in operating profit every year since 2008 with a debt ratio of 140 percent. nw

Photo on Courtesy of KAI