An Offset Success Story An Offset Success Story

Erwin H. Boone Erwin H. Boone

Regional Manager Industrial Cooperation Regional Manager Industrial Cooperation
Lockheed Martin Aeronautics Lockheed Martin Aeronautics
A08-24623
Background
Background
In the Late 1980s, the Economy of South Korea Was In the Late 1980s, the Economy of South Korea Was
Expanding Based on the Commercial Sector Expanding Based on the Commercial Sector
However, the Korean Government Wanted to However, the Korean Government Wanted to
Modernize the Modernize the RoKAF RoKAF Fighter Force Fighter Force
Develop an Indigenous Aerospace Industry Develop an Indigenous Aerospace Industry
Infuse New Technologies and Capabilities Infuse New Technologies and Capabilities
Into the Defense Sector Into the Defense Sector
The Use of Industrial Cooperation / Offset Was Seen The Use of Industrial Cooperation / Offset Was Seen
as a Means of Satisfying Multiple Requirements as a Means of Satisfying Multiple Requirements
Korea Adopted a Strategic Approach to Offsets Korea Adopted a Strategic Approach to Offsets Korea Adopted a Strategic Approach to Offsets
LM Aero Partnership With Korea
LM Aero Partnership With Korea
The First Procurement of The First Procurement of
F F- -16s Under the 16s Under the Peace Peace
Bridge Bridge Program Began a Program Began a
Long Long- -Term Relationship To Term Relationship To
Develop Advanced Aircraft Develop Advanced Aircraft
Capabilities in Korea Capabilities in Korea
Korean Industry Built 40 Korean Industry Built 40
Center Fuselages Center Fuselages
Besides Besides Coproduction Coproduction, ,
Offset Also Resulted in Offset Also Resulted in
Technology Transfer Technology Transfer
Engineering Training Engineering Training
Strategic Approach to Grow the Aerospace Industry Strategic Approach to Grow the Aerospace Industry
LM Aero Partnership With Korea
LM Aero Partnership With Korea (Cont (Cont d) d)
The Korea Fighter The Korea Fighter
Program (KFP) Expanded Program (KFP) Expanded
the Relationship To the Relationship To
Develop Indigenous Develop Indigenous
Aircraft Capabilities Aircraft Capabilities
Phase 1: Purchase of Phase 1: Purchase of
12 F 12 F- -16s Built in Texas 16s Built in Texas
Phase 2: Assembly in Phase 2: Assembly in
Korea of 36 F Korea of 36 F- -16s 16s
From Kits From Kits
More Than 100 F More Than 100 F- -16s Built in Korea Under License 16s Built in Korea Under License
Phase 3: Full Production in Korea of 72 F Phase 3: Full Production in Korea of 72 F- -16s 16s
KFP KFP- -II Built 20 Additional Production F II Built 20 Additional Production F- -16s in Korea 16s in Korea
KFP Offset Program
KFP Offset Program
Extensive Technology Extensive Technology
Transfer to Korean Industry Transfer to Korean Industry
More Than 600 Engineers More Than 600 Engineers
Were Trained in the U.S. Were Trained in the U.S.
Large Volumes of F Large Volumes of F- -16 16
Technical Data Were Technical Data Were
Transferred to Korea Transferred to Korea
Market Assessments, Market Assessments,
Feasibility Studies, and Feasibility Studies, and
Preliminary Design of a New Preliminary Design of a New
Advanced Jet Trainer Advanced Jet Trainer
KTX KTX- -2 (T 2 (T- -50) Began as a KFP Offset Project 50) Began as a KFP Offset Project
Advanced Advanced
Trainer Trainer
Multirole Multirole
Fighter Fighter
Other Multirole Fighters, Except the F Other Multirole Fighters, Except the F- -16, 16,
Had a Complimentary Advanced Trainer Had a Complimentary Advanced Trainer
F/A F/A- -18 18 Typhoon Typhoon MiG MiG- -29 29 F F- -16 16
?
?
Lockheed Martin
Lockheed Martin

s Perspective
s Perspective
Advanced Jet Trainer Would Compliment F Advanced Jet Trainer Would Compliment F- -16 16
Capability Gap Between RoKAFs
Jet Trainers and Frontline
Fighters Continues To Increase
Operational Transition Training
Time Continues To Increase
Current Advanced Jet Trainers Current Advanced Jet Trainers
on the Market Lack . . . on the Market Lack . . .
Aero Performance Aero Performance
Modern Glass Cockpit Modern Glass Cockpit
Digital Flight Controls Digital Flight Controls
State State- -of of - -the the- -Art Avionics Art Avionics
Training Sortie Duration Training Sortie Duration
. . . Needed To Bridge the Gap . . . Needed To Bridge the Gap
F-4
F-5
E/F
F-16
Blk
32
KFP
F-16
Blk
52
F-15K
FXX
Basic
Primary
F-5B
T-38
Hawk
Capability Gap
Current
Trainers
Fighter Aircraft
Republic of Korea Air Force Situation
Republic of Korea Air Force Situation
KAI Proprietary Information
Market Potential
Market Potential
Study of 50 Countrys Requirements Over Next 25 Years
Replacement of Jet Trainer and Light Combat Aircraft
Significant Number of Aircraft Need To Be Replaced Significant Number of Aircraft Need To Be Replaced
5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 0 21 22 23 24 25 26 27 28 29 30
A
n
n
u
a
l

A
i
r
c
r
a
f
t

R
e
p
l
a
c
e
m
e
n
t

N
e
e
d
s
A
n
n
u
a
l

A
i
r
c
r
a
f
t

R
e
p
l
a
c
e
m
e
n
t

N
e
e
d
s
350 350
300 300
250 250
200 200
150 150
100 100
50 50
0 0
AJT / FLI Advanced Jet Trainer / Fighter Lead-In
LCA Light Combat Aircraft
Market Studies Led to LM Investment
Market Studies Led to LM Investment
Investment Based Upon Sound Business, Not Offset Investment Based Upon Sound Business, Not Offset
1988 1988 1990 1990 1992 1992 1994 1994 1996 1996 1998 1998 2000 2000 2002 2002 2004 2004 2006 2006 2008 2008 2010 2010
Korean Fighter Program Korean Fighter Program
KFP KFP- -II II
F-16 Licensed Production
T-50 Additional Capabilities Studies
T-50 Marketing Studies
F-16 Licensed Production
T-50 Additional Capabilities Studies
T-50 Marketing Studies
KTX-2 T-50 FA-50
F-16 Center Fuselage Production
Training / Tech Transfer
F F- -16 Center Fuselage Production 16 Center Fuselage Production
Training / Tech Transfer Training / Tech Transfer
F-16 Coproduction
F-16 Licensed Production
KTX-2 Feasibility Studies
Embedded Training Studies
Advance Trainer Market Studies
F F- -16 Coproduction 16 Coproduction
F F- -16 Licensed Production 16 Licensed Production
KTX KTX- -2 Feasibility Studies 2 Feasibility Studies
Embedded Training Studies Embedded Training Studies
Advance Trainer Market Studies Advance Trainer Market Studies
Lockheed Martin Lockheed Martin
Investment Investment
2012 2012
F F- -16 Peace Bridge 16 Peace Bridge
Funding and I nvestment Funding and I nvestment Work Content Work Content
T
T
-
-
50 Is an International Program
50 Is an International Program
55% 55%
44% 44%
Others Others
1% 1%
70% 70%
13% 13%
17% 17%
Full Full - -Scale Development Program Value of $2.1 Billion Scale Development Program Value of $2.1 Billion
Korea Aerospace Industries Korea Aerospace Industries
Prime Contractor Prime Contractor
Aircraft Design and Integration Aircraft Design and Integration
Major Component Fabrication Major Component Fabrication
Mate Mate- -Thru Thru- -Delivery Delivery
LM Aero LM Aero
Investor and Principle Investor and Principle
Subcontractor in FSD Subcontractor in FSD
Flight Control, Avionics and Flight Control, Avionics and
Wing Development Wing Development
Technical Assistance Technical Assistance
Aerospace Industry Leaders Aerospace Industry Leaders
Republic of Korea Republic of Korea
Government: Funding and Oversight Government: Funding and Oversight
RoKAF: Program Manager, Flight RoKAF: Program Manager, Flight
Test, User, Test, User,
Subject Matter Subject Matter
Experts Experts
T
T
-
-
50 Team
50 Team
Dedicated To Providing the World Dedicated To Providing the World s Best Jet Trainer s Best Jet Trainer
Marion
Composites
Rockwell
BFGoodrich
Aerospace
Established Structure for World Established Structure for World- -Wide Marketing Wide Marketing
Joint Marketing Agreement
Joint Marketing Agreement
KAI and LM Aero Signed a Joint KAI and LM Aero Signed a Joint
Marketing Agreement (JMA) in Marketing Agreement (JMA) in
November 2000 November 2000
KAI Responsible for Marketing KAI Responsible for Marketing
T T- -50 in Korea 50 in Korea
LM Aero Responsible for LM Aero Responsible for
Marketing T Marketing T- -50 in U.S. 50 in U.S.
KAI / LM Jointly Market KAI / LM Jointly Market
T T- -50 Internationally 50 Internationally
Program Status
Program Status
Phase I (Preliminary Design)
Completed December 1995
Phase II (Full-Scale Development)
October 1997 ~ December 2005
Phase III (RoKAF Production)
December 2005 ~ 2015
Phase IV (International Sales)
Production
92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 11 10
Preliminary Preliminary
Design Design
Phase Phase
First Flight First Flight
Aug 2002 Aug 2002
First Delivery First Delivery
Dec 2005 Dec 2005
Rollout Rollout
31 Oct 31 Oct
OML OML
Bridge Bridge
Program Program
CDR CDR
Preliminary
Design
Full-Scale
Development
Design Design
Development Development
Production Production
13 12 14 15
Full
Full
-
-
Scale Development
Scale Development
Program Status
Program Status
Flight Test Program Flight Test Program
Four Flight Test Aircraft Four Flight Test Aircraft
1,411 Sorties Flown 1,411 Sorties Flown
Ground Test Program Ground Test Program
Static Loads Testing Completed Static Loads Testing Completed
Second Lifetime Durability Completed Second Lifetime Durability Completed
Environmental Testing Completed Environmental Testing Completed
Integrated Logistics Support (ILS) and Integrated Logistics Support (ILS) and
Ground Ground- -Based Training System (GBTS) Based Training System (GBTS)
Developed Simultaneously With Developed Simultaneously With
T T- -50 Aircraft 50 Aircraft
Initial Systems Delivered To Support Initial Systems Delivered To Support
RoKAF Operations RoKAF Operations
Development Program Completed! Development Program Completed!
Initial Production Contract Initial Production Contract
Signed December 2003 Signed December 2003
Delivered All 25 Aircraft Delivered All 25 Aircraft
Follow Follow- -On Production Contract On Production Contract
Signed October 2006 Signed October 2006
47 Aircraft 47 Aircraft
Black Eagle Black Eagle Aerial Aerial
Demonstration Team Demonstration Team
10 Additional Aircraft 10 Additional Aircraft
Contract Signed March 2008 Contract Signed March 2008
FA FA- -50 Light Attack Variant 50 Light Attack Variant
60 Aircraft (Future) 60 Aircraft (Future)
Production Program Status
Production Program Status
RoKAF Production Program on Schedule RoKAF Production Program on Schedule
T
T
-
-
50 Growth
50 Growth
One Aircraft for Both Trainer and Light Combat One Aircraft for Both Trainer and Light Combat
Trainer Trainer
AJT / LIFT AJT / LIFT
WSO WSO
Companion Companion
Aggressor / Dissimilar Aggressor / Dissimilar
Pilot Currency Pilot Currency
Light Combat Light Combat
Homeland Defense Homeland Defense
Close Air Support Close Air Support
Reconnaissance Reconnaissance
900+ Aircraft Potential Worldwide Through 2030 900+ Aircraft Potential Worldwide Through 2030
ROKAF: 100 ROKAF: 100 300 300
International: 600+ International: 600+
Market Potential
Market Potential
KTX KTX- -2 / T 2 / T- -50 50
Lockheed Martin Lockheed Martin
KFP-1
Offset
KFP-2
Offset
T-50
Development
KAI KAI International Sales International Sales
Work Work- -share share
T-50
Offset
International International
Customers Customers
International Offset International Offset
T
T
-
-
50 Offset Evolves
50 Offset Evolves
Preparing Offsets to International Customers Preparing Offsets to International Customers
Questions? Questions?