By Avascent Analytics team
3-D Printing White Paper
Additive manufacturing, or 3-D printing, has the potential to disrupt the defense industrial landscape and revolutionize the ways in which militaries equip and supply. Defense firms must actively prepare for growing “on demand” manufacturing expectations. To learn more, check out Avascent’s latest white paper, Drones On Demand: Additive Manufacturing and the Future Battlefield.
A quick look at the biggest stories of the week
South Korea • Czech Republic • Thailand • Romania • Malaysia • Space
On July 10, the South Korean Navy received its sixth Son Won Il/KSS-II class submarine, the Yu Gwan-sun. The KSS-II is based on the German Type 214 submarine. South Korea is expected to receive three more submarines before the first KSS-III class submarines are commissioned in the early 2020’s. Over the next decade, South Korea is expected to spend about $6.6 billion on additional KSS-II and KSS-III submarines, and extending the life of older KSS-I and KSS-II hulls. This spending is expected to increase from about $300 million this year, to a peak of about $800 million in 2023. Submarine investment not only helps counter North Korean naval threats, but will bolster the local ship building industry’s ability to export naval platforms. Some of the major Korean naval exports include submarines for Indonesia, frigates for the Philippines, and an amphibious landing platform dock for Brazil. In 2016, Avascent Analytics identified South Korea as a rising source of competition for international arms deals in the Dynamics of International Military Modernization 2016 white paper.
On July 10, the Czech Republic’s Defense Ministry announced that it intends to buy 16 RBS-70NG man-portable air-defense systems for approximately $43.9 million and upgrade its aging Dana self-propelled howitzers for $55.7 million. The RBS-70NGs will be provided by Saab Dynamics, and are expected to be delivered from 2018-2020. The howitzer upgrades will be performed by Tatra Trucks later in 2017. The new air defense systems are meant to replace the Czech Republic’s existing S-10M systems, whereas the howitzers are only being upgraded to avoid the costs of completely replacing them.
On July 11, Thailand’s Prime Minister announced that the Thai government approved the procurement of eight more KAI T-50 Golden Eagle fighter trainers. The acquisition, estimated to cost $258 million, follows a September 2015 deal for four T-50s. Designated T-50TH, the fighter trainers will begin to replace the Royal Thai Air Force’s fleet of Aero Vodochody L-39s. Thailand will join Indonesia, Iraq and the Philippines as export users of the T-50. KAI completed deliveries of its FA-50PH, the light attack variant of the T-50, to the Philippines earlier this month. The Philippine Air Force had ordered 12 of the light attack aircraft from KAI in 2014.
On July 11, the State Department approved the sale of seven Patriot missile defense systems to Romania. The estimated $3.9 billion deal also includes 56 Patriot MIM-104E Guidance Enhanced Missile-TBM (GEM-T) missiles, 168 Patriot Advanced Capability-3 Missile Segment Enhancement (MSE) missiles, radars, control station, antenna, power plants and launching stations. Previous estimates by Avascent Analytics assumed Romania would procure half the number of units approved by the State Department, though the agreement to procure up to seven missile defense systems is likely due to continued Russian aggression. The Romanian government first announced their intention to buy the defense systems this past April. The time frame for the acquisition of the missile defense systems is unclear. The news comes after Poland signed a Memorandum of Understanding with the US to procure eight Patriot batteries for $7.6 billion on July 5.
Malaysia has put a $2 billion plan to purchase new fighter aircraft on hold. The acquisition of the fighter aircraft was intended to replace the country’s MiG-29’s. This is largely due to a constrained budget environment and the prioritization of enhancing maritime patrol and surveillance capabilities. A NEW fighter acquisition is not expected until 2020 at the earliest. Malaysia originally planned to have the MiG-29’s phased out of service by 2010. Malaysia’s fighter and maritime patrol aircraft are both aging and need to be replaced. The Royal Malaysian Air Force’s (TUDM) MiG-29’s were received in 1995-1996, while its Beechcraft 200T-MP’s were acquired in 1994. Even if Malaysia de-prioritizes its maritime patrol aircraft acquisition within the next three years, Avascent Analytics projects that Malaysia would still put off a fighter acquisition until at least 2020 due to continued budget constraints. Malaysia may not be able to make any new major platform or system purchases in 2017 given a 12% defense budget drop in 2017 and ongoing payments for other costly acquisitions such as the A400M and Gowind-class frigates. Malaysia’s procurement budget is roughly $800 million this year, and would need to grow to roughly $900 million by 2020 if the country wants to replace it’s Mig-29s without making significant cuts or delays to other programs.
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