HAL loses Malaysian LCA contract to South Korea’s KAI

In November 2022, Financial Express Online had reported that the deal might get bagged by the South Korean company, even though HAL had set up its first overseas office in Kuala Lumpur.

HAL loses Malaysian LCA contract to KAI of South Korea
While the Tejas fighter jet has a lower price tag of about US$28 million and is more capable in areas such as range and service ceiling, the FA-50's established brand name and proven capabilities proved to be decisive factors in Malaysia's decision. (Image used for representative purpose)

Malaysia has awarded a contract worth $920 million to Korea Aerospace Industries (KAI) for the supply of 18 aircraft under its Fighter Lead-In Trainer-Light Combat Aircraft (FLIT-LCA) program. KAI will deliver the FA-50 Golden Eagle, a weaponised version of the T-50 trainer, in 2026. The decision was made after a competitive tender that included India’s Tejas fighter jet made by Hindustan Aeronautics Limited (HAL).

HAL Confirms

“We were short-listed for the Malaysian LCA contract. We were hopeful as we were very competitive on several criteria but unfortunately this has not gone our way,” sources in HAL said.

The FA-50 Golden Eagle was chosen due to its superior service record and reputation, having been combat-tested by the Philippine Air Force in various missions against militants, including the 2017 Marawi campaign. This operational experience is expected to be crucial for the Royal Malaysian Air Force (RMAF), which is likely to use the aircraft for air patrols and interceptions due to low availability rates of its mainstay fighters, the F/A-18 Hornet and SU-30 Flanker, and the suspension of the Multi-Role Combat Aircraft (MRCA) program over budgetary issues.

While the Tejas fighter jet has a lower price tag of about US$28 million and is more capable in areas such as range and service ceiling, the FA-50’s established brand name and proven capabilities proved to be decisive factors in Malaysia’s decision. Some 200 of the FA-50 aircraft are currently in service with South Korea, Iraq, and ASEAN members, including Indonesia, the Philippines, and Thailand. South American nation Colombia also recently placed an order for 20 FA-50s, and KAI is confident of striking an FA-50 deal with Egypt, its first venture into the African market.
The acquisition of the FA-50 marks the first step on Malaysia’s Capability Development Plan 2055 (CAP55) transformational journey. The roadmap outlines Malaysia’s plan to acquire a total of 36 aircraft under the FLIT-LCA initiative, which could potentially mean the procurement of another 18 FA-50s. As part of CAP55, the RMAF plans to streamline the types of combat aircraft from five to two (the MRCA and FLIT-LCA) to reduce operating costs.

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Background

In November 2022, Financial Express Online had reported that the deal might get bagged by the South Korean company, even though HAL had set up its first overseas office in Kuala Lumpur the capital city of Malaysia. India’s LCA was among the front runners in the race for the Royal Malaysian Air Force contract which is in the process of phasing out its old Russian MiG-29s.

Others in the race besides India and South Korea were the Sino-Pakistani JF-17 from Pakistan Aeronautical Complex and Chengdu Aircraft Corporation, the Russian Yak-130, and the Italian M-346 from Leonardo.

Other countries in the Asean region have evinced their interest in the Light Combat Aircraft. South American nation Argentina, has expressed its interest too. But there are reports in the public domain that the Chinese could bag that deal.

Reports in the public domain suggest that HAL’s reputation may have been a factor in Malaysia’s decision to select the FA-50 over the Tejas.

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First published on: 20-03-2023 at 14:36 IST
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