Hyundai Rotem has begun the localization process by starting working-level talks with a local firm that will handle production in Poland of the K2 tank, its main export item. After reviewing the supply chain in Poland, Hyundai Rotem plans to use the country as a European production base for the K2 tank to seek additional exports in Europe.
According to the defense industry on the 2nd, Hyundai Rotem recently began preparations to produce the Poland-specific K2PL tank with Bumar, a subsidiary of Poland's state-run defense company PGZ. It is checking the condition of the Bumar plant and inspecting supply chains for local procurement of K2 tank parts. A Hyundai Rotem official said this is "a procedure for actual production."
Separately, Hyundai Rotem is conducting system development for the K2PL in Korea. It is expected to outperform the K2 gap-filler that the Korean military also operates. System development includes integrating the Trophy active protection system (APS) slated to be installed on the K2PL.
Trophy is a system that neutralizes enemy anti-tank missiles and anti-tank rockets, and it is a product of the Israeli defense firm Rafael. It will be installed only on the 61 K2PL units to be produced in Poland. The K2 gap-filler batch will be equipped with a soft-kill system that defeats attacks with jamming, smoke, and the like.
The K2PL is slated to feature a remote fire-control system and high-strength armor with enhanced protection. Hyundai Rotem plans to select parts suppliers depending on the progress of system development. For the existing K2 tank, the fire-control system was made by Hanwha Systems, and the weapons assembly (the projectile firing device including the gun barrel and autoloader) was made by HYUNDAI WIA. The tank's armor was produced by Samyang Comtech.
Hyundai Rotem's investment in Poland on a scale comparable to establishing a factory is a strategy to target the European market. Once facilities are in place locally in Europe and some technology transfer is completed, it can respond quickly to urgent demand. In contingencies, it could also handle volumes that would be difficult to cover with domestic plants alone.
Local production is seen as essential to lower the threshold of the European Union (EU) defense bloc-formation. Defense bloc-formation refers to expanding defense cooperation with internal corporations while erecting high entry barriers for external firms.
Early this month, the European Commission announced member-by-member allocation plans for the total €150 billion budget for SAFE (Security Action For Europe), a loan program for joint weapons purchases. As part of Europe's rearmament plan, it includes a "Buy European" clause requiring 65% of weapons components to be produced within the EU.
An industry official said, "The European rearmament plan has uncertainties, but local production will be a card that removes uncertainty," adding, "We need to increase defense cooperation with local European firms, including technology transfer."