South Korea on Monday started testing and evaluating two surveillance plane models vying for a mutli-billion-dollar project as a preliminary step toward choosing a winning bidder in mid June, the country's defense acquisition authorities said.
U.S. aircraft giant Boeing has been fighting an uphill battle with the relatively obscure Israeli manufacturer IAI ELTA to win the 2-trillion-won (US$2 billion) Korean project, code-named E-X, to introduce four surveillance planes to South Korea by 2012.
"Because of a monthly schedule of a defense acquisition meeting, we will choose the winning bidder on June 14 or June 21 after a fair test and evaluation process from today," an informed source at the Defense Acquisition Program Administration (DAPA) said, asking to remain anonymous.
South Korea had originally planned to announce a successful contender later this month amid indications that the supplier could be a non-U.S. firm. It still plans to conclude the deal in June at the latest.
The two bidders presented all the needed documents for the test and evaluation, and the Israeli firm and its U.S. partner DRS submitted the export license for selling aircraft-identifying Datalink equipment and the Satcom ground satellite communication system, which are to be installed in its G-550 model.
"Last year, we had no choice but to set a new deadline for the test and evaluation because both contenders failed to submit the documents for a few communication devices," the DAPA said in a statement.
The export licenses have become a key issue as the Israeli firm was awaiting U.S. approval of overseas sales after South Korea postponed until May the deadline by which it will choose a winning bidder for the much-coveted project.
The delay has fueled speculation that IAI ELTA is being favored to win due to its alleged price advantage, although South Korea said both sides failed to submit necessary documents on satellite communications and other key equipment to be installed. The selection had earlier been delayed from January to December 2005.
South Korea plans to conclude the deal in June at the latest after selecting the winning bidder in May amid indications that the supplier could be a non-U.S. firm.
In January, Kim Jeong-il, head of the DAPA, said South Korea would choose the bidder that offers lower prices as long as it meets the required operational capabilities.
IAI ELTA is reported to be offering $1.1 billion as opposed to Boeing's $1.5 billion.
South Korea purchases most of its military weapons from the United States, although their prices are comparatively high. But calls have risen among South Korean officials to diversify the sources of their weapons, depending on how much they cost and other merits.
U.S. officials are advising South Korea to continue to use American weapons, stressing the advantage of high interoperability with their military. About 30,000 U.S. troops are currently stationed in South Korea, a legacy of the 1950-53 Korean War.
After South Korea chose European helicopter manufacturer Eurocopter for its multi-billion-dollar project to develop advanced transport helicopters in December, U.S. Ambassador Alexander Vershbow met quietly with South Korean Defense Minister Yoon Kwang-ung. Vershbow reportedly discussed with Yoon the importance of interoperability between the two countries' militaries.
South Korea's choice of the Franco-German firm over U.S. firm Bell for its helicopter project came as something of a surprise.
In 2002, Seoul chose Boeing's F-15K as its next-generation fighter model in consideration of the long-standing military alliance with the United States, giving a new lifeline to Boeing's then-sputtering F-15 production line in Missouri. The French-built fighter Rafale beat the F-15K by a narrow margin in the technical phase of evaluation.
The surveillance plane project is aimed at strengthening the aerial surveillance capability of South Korea, which is still technically in a state of war with North Korea as the Korean War ended with an armistice, not a peace treaty.
South Korea plans to deploy the first two surveillance planes in 2009 and the other two in 2011. The country now depends on U.S.
radar aircraft based in Okinawa, Japan, as it currently has no aerial warning systems.
(Yonhap News Agency)
[Business] South Korea to Pick Winning bidder for E-X Project Next |
