Boeing Targets India, Japan and South Korea

(Aviation week) : Boeing has moved on from its loss in India’s Medium Multi-Role Combat Aircraft competition and is now focusing on other opportunities in that country, while also preparing to compete for fighter contracts in Japan and South Korea.
“Although we’re disappointed with the results of the fighter campaign in India, we’ve moved forward,” Boeing Defense, Space and Security CEO Dennis Muilenburg told journalists during a press briefing at the Shangri-La Dialogue in Singapore June 3.
He points out that Boeing has won some other competitions in India, such as an order for 10 C-17s. “We’re continuing to see progress on the C-17 deal in India. We’ve had a successful field trial and government-to-government relationship is supporting that process,” Muilenburg says. “We do expect it to come to completion some time this year,” he adds. India is looking at 2013-14 deliveries and — even though Boeing is reducing the C-17 production rate to 10 per year from 15 — India’s schedule still “fits nicely with that.”
India has a requirement for both attack and heavy-lift helicopters. Boeing is competing in those competitions and Muilenburg says the AH-64D Apache and CH-47F Chinook successfully completed the field trials.
The other Asian markets where Boeing is busy are Japan and South Korea. Japan issued a request for proposals (RFP) for 40-50 fighters and Boeing is in the competition with its F/A 18E/F Super Hornet, while the other contenders are the Eurofighter Typhoon and Lockheed Martin F-35. Japan’s air force is hoping a decision can be made in time for the procurement to be included in the next budget cycle, starting April 1, 2012.
“We were very encouraged that the RFP was issued early this year, and we have every indication that the procurement will move ahead as planned,” Muilenburg says.
Japan’s defense guidelines say the first 12 fighters are to be delivered in the fiscal year ending March 2017. Muilenburg describes the F/A-18E/F as a low-risk solution, particularly in terms of cost and the delivery schedule. One of the challenges Lockheed Martin faces is convincing Japan’s defense establishment that it can deliver F-35s on time and on budget.
The F-35 is marketed as being a true “fifth-generation” fighter, but Muilenburg argues “the Super Hornet is fielding the world’s most advanced technologies.” He says the U.S. Navy will be operating Super Hornets for decades to come. Even though the Navy will also be adding F-35s, Muilenburg says in the year 2035 two-thirds of fighters on U.S. aircraft carriers still will be Super Hornets. “No one should see the F-35 as a replacement for the Super Hornet,” he adds.
Muilenburg says Boeing already has a close relationship with Mitsubishi Heavy Industries (MHI), which manufactures Boeing F-15s for the Japanese air force. The company plans to leverage that relationship — as well as the relationships it has with Fuji Heavy Industries and Kawasaki Heavy Industries — to help its bid to win Japan’s FX fighter competition. But Lockheed Martin also has a strong relationship with MHI, which builds F-2s, a derivative of the Lockheed Martin F-16.
Japanese industry wants to be more involved in Western aircraft programs. Muilenburg says if the Super Hornet is selected, “I think [Japanese] industry will play a fundamental role in the program.”
Boeing also is waiting for South Korea to issue its RFP for 60 fighter aircraft, which is expected by the end of 2012’s first quarter. Boeing will be pitching F-15s; but Joe Song, vice president for Asia-Pacific defense activities, says these F-15s will be different from those that Boeing earlier sold to South Korea. He says the aircraft will have active, electronically scanned array radar, a digital electronic warfare system and internal weapons carriage.
Such competitions are taking on more importance within the Boeing group, particularly in light of U.S. defense cuts. Muilenburg says overseas sales in recent years accounted for 7% of Boeing’s defense business; but last year it jumped to 17%, and in the next few years it will account for 25%. “A great proportion of that [25%] is based on the strength of Asia-Pacific,” he says.
A breakdown of the Boeing group’s total revenue shows that it is split equally between civil and defense. Muilenburg predicts that the split will remain 50/50 for years to come, even though the defense unit’s biggest customer, the U.S. government, is reducing military spending. Besides generating revenues from overseas, Boeing’s defense business also is investing heavily in unmanned aerial vehicles and cybersecurity. “These are market segments that are growing beyond the norm of the standard defense budget,” he says.