February 8, 2018 / 11:20 AM / 2 years ago

South Korea to buy next maritime patrol aircraft overseas

The Boeing Company logo is projected on a wall at the "What's Next?" conference in Chicago, Illinois, U.S., October 4, 2016. REUTERS/Jim Young

SEOUL (Reuters) - South Korea will acquire its next maritime patrol aircraft from overseas, an official at the defence procurement agency said on Thursday, with Boeing (BA.N) and SAAB (SAABb.ST) likely to be vying for the contract.

Boeing’s P-8A Poseidons and SAAB’s Swordfish planes are expected to compete for a deal worth about 1.9 trillion won ($1.75 billion) for at least six maritime patrol aircraft, wire service Yonhap reported on Wednesday, citing an unnamed military source.

Both Boeing and Saab have said they are interested in the contract.

Boeing Vice President of Global Sales, Defence, Space & Security Gene Cunningham on Wednesday said he was hopeful that South Korea would choose the P-8 Poseidon by the end of the year. “That could very well be the next customer,” he said.

Saab’s head of Asia-Pacific Dean Rosenfield on Thursday said that time line was “presumptuous” of Boeing and is only likely if the government decides to award a direct contract rather than seeking competing bids.

“If they go to an open tender, I can’t see that,” he told Reuters on the possibility of closing a deal this year.

Nothing else has been decided with regard to the procurement, an official at South Korea’s defence acquisition agency said, adding that the new aircraft need to be more technically advanced than the country’s existing Lockheed P-3 Orions.

The agency declined to comment on the procurement’s expected size or potential models.

Details of the procurement process, including whether it will go to tender, are expected to be decided in the first half of 2018, the official said.

Reporting by Joyce Lee in SEOUL and Jamie Freed in SINGAPORE; Writing by Ju-min Park; Editing by Richard Borsuk and David Goodman

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