The Weekly Wire: Week of 7/13/15
Airbus Defense and Space beat out rivals Boeing and Israel Aerospace Industries when South Korea selected its A330 MRTT for the future airborne refueling tanker. Four MRTT aircraft will be provided to South Korea in 2018-2019 for $1.2B. While the Korean government pointed to the A330’s flight range and higher fuel- and cargo-payload as the primary reasons for its decision, Boeing’s inability to provide the KC-46A earlier than 2019 also likely played a role – as did the recent decline of the Euro – and therefore the MRTT’s price. The selection of the European A330 also indicates a competitive South Korean market moving forward, which will likely see future defense contracts partially decided by a willingness to provide tech transfers and logistics support.
On July 8, it was reported that the Australian military had decided to cancel the planned purchase of two squadrons of F-35B Joint Strike Fighter. While Australia has already committed to buy 72 units of the F-35A, the government had been mulling over a decision to buy 18-24 F-35B planes as part of this commitment. The F-35B jets would have flown off of two new Royal Australian Navy Canberra-class landing helicopter dock ships, which would have required $4.4B worth of modifications to accommodate the F-35Bs. The government cited this cost as one of the reasons for abandoning the potential purchase. Two other considerations might have come into play, as well. First, the future operational scenarios anticipated by the Australian Defence Force do not greatly require the capabilities of the F-35B. Second, Australia has few pilots currently trained for STOVL aircraft, so the acquisition of F-35B aircraft would have also required a large training effort by the ADF. This revelation comes as the Abbot government prepares to release a defence white paper in August. More details may be available then.