KAI Finalizes $1.4 Billion South Korean Chopper Development Deal

Korea Aerospace Industries has won a 1.64 trillion won ($1.49 billion) deal to develop military and civilian helicopters by 2022 to replace aging 500MD and AH-1S South Korean military choppers, the Korea Herald reported Saturday.

For the development of the Light Armed Helicopter (LAH) and Light Civil Helicopter (LCH), KAI is to get technical assistance from Airbus Helicopter. The two firms signed an agreement to jointly develop the helicopters last month, officials from the Defense Acquisition Program Administration said.

“There have been differences between DAPA and KAI over a number of issues including the percentage of indigenous components to produce the helicopters,” an unnamed DAPA official was quoted as saying by the news daily. “But we reconciled them through 20 rounds of marathon talks from last August until last month,” the official said.

Although DAPA and KAI have reached an agreement over the overall technological development, they have yet to conclude their negotiations over the development costs. Their talks over the costs will be finalized later this month, and the two sides are expected to sign a final agreement for the helicopter project in May, DAPA officials said.

The project to develop the military helicopter is led by DAPA, while the Ministry of Trade, Industry & Energy is in charge of developing the civilian helicopter. The LAH project is estimated to cost 692.6 billion won, while the LCH project will cost around 950 billion won.

KAI is to develop the LCH based on Airbus Helicopter’s EC-155B1 platform. It will then transform the LCH into the LAH ― a military chopper with defensive and offensive equipment such as antitank missiles and machine guns. The LAH and LCH are to share more than 50 component parts.

According to the government plan, while the LCH will be developed in 2020, the LAH is to be developed in 2022.