WASHINGTON — Lockheed Martin and the South Korean government have cemented a $1.2 billion contract for F-16 upgrades, marking an official victory for Lockheed over previous contract-holder BAE Systems.
Under the terms of the foreign military sales agreement announced Friday, Lockheed will modernize 134 jets to a configuration similar to its advanced F-16V model. Among the upgrades planned to be funneled into the Korean jets are an Active Electronically Scanned Array (AESA) radar; a modern commercial off-the-shelf-based avionics subsystem; a large-format, high-resolution center pedestal display; and a high-volume and high-speed data bus, the company said.
"We truly appreciate the trust and confidence the Republic of Korea has placed in us with this contract," Susan Ouzts, vice president of Lockheed Martin's F-16 program, said in a statement. "These upgrades are a critical piece of South Korea's national defense and highlight Lockheed Martin's commitment to the full lifecycle of the F-16, from production to through-life sustainment."
With 25 countries operating more than 4,500 F-16s worldwide, Lockheed has turned modernization of the fighter into a lucrative line of business. However, in 2012, BAE beat Lockheed for an earlier contract to upgrade Korean KF-16s, the first time the original equipment manufacturer had ever lost an F-16 contract.
The relationship between the Korean government and BAE began to sour when — according to South Korean officials — the company and US government began to increase the size of the contract, Defense News previously reported. The US government reportedly added about $470 million in extra costs, while BAE Systems added another $280 million.
Although Lockheed did not directly comment on the importance of retaking the F-16 upgrade contract from BAE, the company made what could be seen as backhanded criticism of its competitor in its news release.
"As original equipment manufacturer and design authority of the F-16, Lockheed Martin is uniquely qualified to design, engineer, develop, integrate and sustain a complete F-16 weapons system solution tailored to customer requirements," it stated.