Boeing, Eurofighter Meet F-X Budget Constraint

Boeing’s F-15 Silent Eagle and EADS's Eurofighter Tranche 3 Typhoon have met the budget constraint of F-X program, according to The Korean Times.

Boeing and the EADS come within the the procurement price of 8.3 trillion won ($7.5 billion) on the final day of an extra three-day auction for purchase of 60 “next-generation” fighter jets.

The other competitor is Lockheed Martin’s F-35 Lightning II in the Air Force program to buy 60 combat planes to replace its obsolete fleet of F-4s and F-5s.

The Defense Acquisition Program Administration (DAPA) spokesperson confirmed that there is at least one who satisfied the procurement price, but declined to announce how many aircraft closed the price gap citing the ongoing procedure. 

DAPA will shortly evaluate all three fighter jets before a committee meeting, presided over by South Korean Defense Minister Kim Kwan-jin, and the winner will be finalized next month.

However, the procurement agency added that although all three aircraft will be under assessment, any aircraft exceeding the budget will not be signed for the F-X contract, with the possibility that there will be no winner based on the evaluation.

Starting on June 18, DAPA held a total of 55 bidding sessions for three weeks, but all competitors failed to satisfy the budget requirements and as a result, DAPA temporarily suspended the project on July 5.

If it had been no firm which closed the price gap, DAPA would have declared the bid a failure and reconsidered the program from scratch.

The F-35 stealth jet was seen as the favorite from the beginning of the project given South Korean Air Force’s long pursuit of stealth fighter jets that can pass through North Korea’s complex web of radars and given the close relations between Korea and the U.S., the home country of Boeing.

But the company cannot lower its bid, given that the U.S. government is unable to offer a fixed price because the stealth jet is still being manufactured and simultaneously tested.

In addition, the Park Geun-hye administration is focusing on funding 135 trillion won in welfare spending, so the Ministry of Strategy and Finance reportedly rejected DAPA’s call for a budget increment after failing to find a bidder who placed bids within budget constraints.