Korea Aerospace Industries (KAI) has posted its best-ever financial results in the two most recent years. The company raked up 2.901 trillion won in sales last year, a 25.3 percent jump from 2.314 trillion won in 2014. The company saw its operating profit surge to 285.7 billion won, a 77.1 percent increase over the 161.2 billion won recorded in 2014. In particular, last year KAI saw winning orders swell to 10 trillion won, a 4.16-fold jump, and order backlogs surged 63 percent to 18 trillion won.
KAI is changing from a domestic-focused company to an export-oriented one with the portion of exports climbing to 62 percent. The company aims at posting 3.5 trillion won in sales, 350 billion won in operating profit and 6.5 trillion won in winning orders.
KAI is Korea’s biggest aerospace company. Its business portfolios range from aircraft, helicopters and aircraft parts and performance improvement to unmanned aircraft vehicles (UVA), KPX (Korean Fighter eXperimental), homegrown jets, and multi-purpose satellite programs.
KAI has declared a vision of logging 10 trillion won in sales by 2020 to become one of the top 15 aerospace companies in the world. The company has a target of 20 trillion won in sales to join the ranks of the top six aerospace providers in the world.
It is closely examining mega-projects with the goal of realizing its vision.
The KPX project calls for developing, mass producing and exporting a middle-class fighter as a replacement to aging F-4s and F-5s, Korean Air force’s major fighters, in a joint international development. KAI will launch its own development this year and mass-produce the fighter by 2024. It has a target of mass-producing 1,000 fighters, including 430 jets for domestic use and 570 for export.
The LAH/LCH program is to replace aged ROK’s attack helicopters AH-IS/500MDs and capture the market for commercial small-sized helicopters, integrated military and commercial into a single platform, to maximize interoperability. The strategy is going to aid KAI’s global ambitions. The KPX program calls for mass-producing helicopters in 2021. KAI plans to produce 1,000 helicopters 430 copters for domestic use and 570 others for export. The value of the project will stand at 23 trillion won and create 130,000 jobs.
The T-X program is to replace U.S. Air Force’s advanced trainer T-38. KAI and Lockheed Martin will participate in a joint tender to a bid on the program, to be submitted this year. The program calls for signing a contract in 2017 and mass-production to start in 2021. The value of the project will amount to 38 trillion won and having an effect of creating 180,000 jobs. If the T-X program is implemented successfully, KAI is expected to command the global advanced trainer market. If U.S. Air Force adopts the T-X trainer, KAI said, the company will be awarded additional orders on 1,000 advanced trainers from the United States’ allies.
On top of homegrown aircraft production, KAI is expanding its business portfolios to pilot/maintenance crew education, and aerospace support and follow-up support facilities. The company made a splash in the global aerospace market as it has developed and exported the basic Korean-developed KT-1 trainer, a first in Korea, and the T-50 aircraft, the homegrown supersonic advanced trainer as well as the Korean Utility Helicopter (Surion), Korea’s homegrown helicopter. KAI has a vision becoming a total solution provider. The company plans to expand the export of the basic KT-1 to such countries as Senegal, Turkmenistan, Paraguay and Rwanda, while the T-50 will be marketed in Peru, Botswana and Kuwait.
The MRO (maintenance, repair and overhaul) segment is KAI’s future core area. KAI will likely see the winning MRO orders surge from 600 billion won in 2016 to 1.7 trillion won in 2020.
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The KT-1, a Korean-developed basic trainer.
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