Seoul is given Boeing ultimatum

^{Brendan Sobie / Singapore}

Boeing and the US government are urging South Korea to select a 737-based airborne early warning and control (AEW&C) system during a key acquisition meeting this week, amid warnings that a new bid will not be submitted if Seoul again delays the programme.

South Korea’s E-X programme could be nearing an end after years of delay and repeated tenders, with a Defence Acquisition Programme Administration (DAPA) meeting scheduled for 17 May. Proposals from Boeing, offering the 737 with Northrop Grumman’s Mesa radar, and Israel Aircraft Industries (IAI), offering the Gulfstream G550 with Elta’s Phalcon radar integrated by US-based DRS Technologies, are being evaluated.

Sources say if the DAPA selects both teams for contract negotiations, IAI will almost certainly win because its business jet-based offer is less expensive. But the US government is urging the administration to eliminate IAI, saying its team has not provided sufficient technical information and does not fully meet the requirement. In March, DRS received clearance from the US Department of State to provide unclassified information, but has yet to sign a technical assistance agreement (TAA) with IAI or secure an export licence to provide classified information.

The DAPA must decide whether it has received enough technical information to fully evaluate and select the G550, with the Israeli-led team confident it can secure clearances post-selection. Washington has so far refused to give DRS and Gulfstream advocacy because it does not have TAAs in place with the Israeli company.

If the DAPA committee delays a decision until its next meeting on 21 June, it will be almost impossible to complete contract negotiations before current bids expire on 30 June. Sources say Boeing has told the administration it will not extend its bid or submit another one, because of multiple costly delays to the programme and concerns that the cost of its solution will escalate because of price pressures from suppliers.

Sources say Boeing could consider dropping its 737-based AEW&C product – so far sold only to Australia and Turkey – if it loses the South Korean campaign.

Source: Flight International