Korea Aerospace Industries (KAI) said on the 6th that it signed a performance-based logistics (PBL) contract with the Ministry of National Defense of the Philippines for the FA-50PH multirole fighter. The deal is worth about 101.4 billion won, with a three-year term through 2028.
PBL is a system that provides logistics support based on operational outcomes such as aircraft availability and maintenance reliability, and is an advanced logistics support method that builds a stable support structure over the 30 to 40 years of an aircraft's life cycle.
KAI signed a one-year pilot PBL contract worth about 27 billion won with the Philippines in Dec. 2024, the first such deal with an export customer. It then secured stable operational performance and high aircraft availability, leading to this three-year long-term PBL contract.
The Philippines is a representative FA-50 operator for KAI, having first introduced 12 FA-50PHs in 2014 and building a relationship of trust over about 10 years through follow-on and logistics support.
On that basis, the Philippines added 12 more FA-50PHs last year and has been expanding cooperation by consecutively signing a performance upgrade program for the FA-50PHs originally exported in 2014.
A KAI official said, "Following the PBL contract signed with Thailand in Apr. last year, this Philippine PBL case shows that a virtuous cycle—starting with aircraft exports, continuing with stable follow-on support, and expanding into additional acquisitions and performance upgrades—has been taking root in a stable manner."
Follow-on support for aircraft amounts to two to five times the aircraft acquisition cost, making it increasingly important. KAI is fostering follow-on support as a core business group and positioning it as a differentiating competitive factor in the global aerospace and defense market.
Park Gyeong-eun, head of KAI's CS division, said, "For all countries operating or planning to operate domestically produced aircraft, we will build customized follow-on support systems optimized to each nation's operating environment and requirements," adding, "Through this, we will secure sustainable export competitiveness and further expand our presence in the global aerospace and defense market."