PH expects delivery of Korean fighter jets in 2015

**Monseratto** · February 16th, 2014 10:17 AM

With the TA-50 procurement in limbo due to the downpayment issue, maybe we should lease fighter jets instead like the Malaysian are planning... The SAAB Grippen is a role model in leasing ... And they don't have political strings attached like American weaponry...

Cash-Strapped Malaysia Looks To Lease Fighters | Defense News | defensenews.com

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SINGAPORE‬ — Malaysia’s proposed purchase of fighter jets has switched from a procurement competition to a leasing competition due to affordability issues, according to industry executives.

The Malaysian government put its multirole combat aircraft program in the freezer last year for fiscal and political reasons. Now Boeing, BAE Systems and Saab have, or are about to, submit leasing proposals in the hope of making a deal palatable.

It’s possible Dassault Aviation and Sukhoi, which were also on the original procurement shortlist, are in a similar position, according to executives on the sidelines of the Singapore Airshow last week.

“The Malaysian government are mindful of the need for an affordable solution, so we understand that all the competitors are putting offers on the table for leasing. The program has become very much about affordability,” said Alan Garwood, BAE’s group business development director.

Until recently, the Royal Malaysian Air Force had been looking for a straight purchase of a new jet to replace 18 aging MiG-29 fighters, due to leave service next year.

But Malaysian budgets are under pressure to be cut, making it politically difficult to approve a multibillion-dollar deal for a fighter while the administration is cutting subsidies on items such as food and fuel while hiking taxes.

An industry executive asked whether Malaysia has the political will to make any kind of selection at this time, leasing or otherwise.

Leasing civil airliners like the Boeing 737 is big business, but in the fighter world, it’s a rare event. Sweden’s Saab is the only top-line combat jet supplier involved in leasing, with existing deals with the Czech Republic and Hungary for the Gripen for several years.

Teal Group analyst Richard Aboulafia reckons that Saab’s experience in fighter leasing could give it the edge in Malaysia.

“They have planes to spare, they know how to structure this kind of deal and have a good presence in the region,” he said.

Neighboring Thailand is operating the Gripen, having purchased 12 of the single-engine combat jets.

The current leasing arrangements involve Saab upgrading spare Swedish Air Force Gripen C and D models. It’s likely that a similar formula is being offered to Malaysia.

The Swedish company submitted its leasing option as long ago as 2012. Rival bidders were dismissive of the move at the time, but now, everybody is following Saab’s initiative.

“According to our estimates from 2010 to 2011, defense spending in the Asia-Pacific region grew by $31 billion, [a] 16 percent year-on-year increase, while from 2012 to 2013, the level of growth totaled $14.4 billion,” or 6.2 percent, he said.

“Our tentative estimates for regional defense spending from 2013 into 2014 reflect another slower rise in overall growth, with military investment increasing by $16 billion overall, with a little over half of that attributable to China, or 6.5 percent,” Darling said.

The analyst said he anticipates relatively consistent — but steadily upward — year-on-year defense spending for the region, largely driven by China, but to a lesser extent also by Indonesia.

“As China increases its military might and reach, neighbors as diverse as Japan, India, the Philippines and Vietnam are mapping out fresh modernization plans to achieve satisfactory levels of deterrence,” he said. “Even countries such as Malaysia, which maintains healthy relations with Beijing, have recognized the need to upgrade their hardware in light of China’s growing strength and increasingly assertive territorial claims in the East and South China seas.”

**safeorigin** · February 16th, 2014 05:43 PM

Gripen is well known for their bang for buck proposal. They only lose put when it comes to last minute political maneuverings like in the Indian MRCA.

The most attractive part about it is the upgrade path to Gripen NG and integration with upcoming 6th gen UCAV so we can skip 5th gen entirely and acquire more affordable air fleet.

Then, if only the leaders have actual spine...

**Monseratto** · February 21st, 2014 08:07 AM

Finally...some compromises with KAI over the payment scheme. Project is back on track.

Palace OKs payment scheme for S. Korean fighter jets | Headlines, News, The Philippine Star | philstar.com

Palace OKs payment scheme for S. Korean fighter jets
By Alexis Romero (The Philippine Star) | Updated February 21, 2014 - 12:00am

MANILA, Philippines - Malacañang has approved the payment scheme for the purchase of 12 lead-in fighter trainer jets from South Korea, taking the deal to acquire the air assets a step closer to completion.

The defense department has been allowed to make an advance payment of 15 percent of the total contract price to South Korean firm Korean Aerospace Industries (KAI).

The project has an approved budget of P18.9 billion and is one of the big-ticket items in the military’s upgrade program.

Malacañang has also granted the defense department’s request to tap a progress payment scheme, wherein the government will pay the supplier on a mutually-agreed upon schedule.

The approval of the payment scheme was contained in a memorandum signed by Executive Secretary Paquito Ochoa Jr. on Feb. 13.

Defense Undersecretary Fernando Manalo confirmed the approval of the payment scheme for the multibillion-peso project.

Sources told The STAR the defense department is seeking to complete the negotiations with KAI within the week. Officials are now preparing a contract on the payment scheme.

The government is planning to spend P18.9 billion for the jets to boost the country’s territorial defense capabilities.

It will also spend P135.99 million for the basing support systems of the jets.

KAI initially wanted 52 percent down payment to cover manufacturing costs, but it dropped the payment scheme and agreed to a progressive payment.

Under the new scheme, the government would deliver payments upon completion of certain “milestones” or progress related to the construction of the jets.

Earlier, Defense Secretary Voltaire Gazmin said the delivery of the jets could start in June 2015.

Another issue that was settled was the turnaround time, the period required for the delivery of the jets’ spare parts under a two-year warranty.

It usually lasts 30 to 45 days but KAI initially wanted it prolonged it to 180 days. Both parties have agreed to 60 days.

**badkuk** · February 21st, 2014 10:49 AM

Now that we have the planes, do our pilots know how to fly it? i think this is the first time we've had jet planes in the PAF(except for the Blue Diamond team), all the while we've been using piston-driven planes?

Also, do we have a radar system that the planes can use? If none then we're not really leveraging the planes properly.

Still, this is good news for the PAF. sana A-10 Thunderbolt na lang kinuha natin pero mahal :D

Ano kaya magiging callsign ng mga piloto natin:

"Boy Pickup"
"Mr. Suabe"
"Ser Chief"

:D

**safeorigin** · February 21st, 2014 11:31 AM

A-10's aren't ideal for COIN. They are meant for CAS anti-tank role.

you may find it distasteful but bronco's are already the ideal aircraft for COIN(counter insurgency) which is the majority of conflicts we are currently facing.

there's a good reason why the PAF is leaning towards the super tucano...

**yebo** · February 21st, 2014 01:30 PM

Besides being able to carry various weapons and munitions the supertucanos have 8 hours flight times, making them ideal for both coin and sea patrols.

**badkuk** · February 21st, 2014 01:50 PM

hmm, impression ko sa bronco is spotter plane lang. You make do with what you have i guess.

**safeorigin** · February 22nd, 2014 12:05 AM

Well, assuming the military acquisitions go well, my wish list would be:

-Saab Gripen
-S100B Argus
-Dassault nEUROn

**Retz** · February 22nd, 2014 01:10 PM

PAF to Receive 2 Attack AW-109s This Year

MANILA — The Philippine Air Force (PAF) said on Tuesday that two units of the attack version of the AgustaWestland AW-109 "Power" helicopters will be delivered this year.

"Two units will be delivered by 2014 and (by) 2015 (the remaining) six units will be delivered. As per signed contract, two units will be delivered 365 days upon LC (letter of credit) opening," PAF spokesperson Col. Miguel Ernesto Okol said.

He added that the pilots and flight crew who will man the brand-new aircraft have already been identified.
"Pilot(s) and (flight) crew (are now) identified. However, the date for training is TBDL (to be determined later)," Okol said.

The Philippines and AgustaWestland signed the P3.44- billion contract for the attack version of the AW-109s last Nov. 6.

The PAF’s AW-109 "Power" configuration will feature a dedicated mission package and equipment, including a combination of weapon systems.

“It gives us great pleasure to sign this contract with the Philippine Air Force, further reinforcing the already strong partnership with the Department of National Defense. This latest achievement provides clear evidence of the customer’s confidence in the product while we’ve demonstrated that we are a reliable partner, able to offer a cost-effective solution. We are committed to deliver the improved mission capabilities and high quality services the customer deserves,” AgustaWestland chief executive officer Daniele Romiti earlier said.
The AW-109 "Power" is a three-ton class eight-seat twin engine helicopter.

The spacious cabin is designed to be fitted with a number of modular equipment packages for quick and easy conversion between roles.

The aircraft’s safety and survivability features include a fully separated fuel system, dual hydraulic boost system, dual electrical systems and redundant lubrication and cooling systems for the main transmission and engines.

The AW-109s' superior speed, capacity and productivity combined with reliability and ease of maintenance make it the most cost effective helicopter in its class for a range of government tasks.

Over 580 AW-109 "Power" and AW-109 LUH helicopters have been ordered for parapublic, military and commercial applications by customers in around 50 countries.

Source: DEFENSE STUDIES: PAF to Receive 2 Attack AW-109s This Year

DEFENSE STUDIES: PAF to Receive 2 Attack AW-109s This Year

**Retz** · February 27th, 2014 10:12 AM

DND may spend P4.5 B for fighter jet munitions

MANILA, Philippines - The Department of National Defense is planning to spend about P4.5 billion to arm the 12 lead-in fighter trainer jets it is seeking to acquire from South Korea.

Defense department data show that the munitions for the fighter jets are not included in the aircraft acquisition program under the revised Armed Forces modernization law.

The acquisition of munitions for the fighter jets will be divided into four phases – P4.33 billion for the first two and P139 million for the other two.

Details of the items to be installed in the jets were not immediately available. Previous reports, however, said the aircraft being eyed can be armed with precision guided bombs and air-to-air and air-to-surface missiles.

The defense department said the munitions may be acquired either through negotiated or public bidding.

The mode of procurement depends on the availability of the items in the market. Military equipment being offered by several suppliers are normally acquired through public bidding, while specialized ones are usually acquired through negotiations.

The government aims to shell out P18.9 billion to acquire 12 FA-50 jets from South Korea to improve the country’s territorial defense capabilities.

Security officials are now negotiating with South Korean firm Korean Aerospace Industries (KAI) for the project.

The government also aims to spend P135.99 million for the basing support systems for the fighter jets.

Earlier, Defense Secretary Voltaire Gazmin said the delivery of the jets may start in June 2015.

The defense department had asked Malacañang to allow the release of a 52-percent down payment to KAI.

The law permits state agencies to pay 15- percent down payment to suppliers while the rest of the amount would be paid upon delivery of the goods.

KAI wants the Philippines to pay 52- percent down payment to cover the aircraft manufacturing costs. Such payment scheme would require the approval of President Aquino.

The acquisition of FA-50 jets is one of the big ticket items in the military’s multibillion-peso upgrade program.

Source: DND may spend P4.5 B for fighter jet munitions | Headlines, News, The Philippine Star | philstar.com

DND may spend P4.5 B for fighter jet munitions | Headlines, News, The Philippine Star | philstar.com