Korea Aerospace Industries (KAI) announced Wednesday it has signed a Performance-Based Logistics (PBL) contract with the Philippine Department of National Defense for the FA-50PH multi-role fighter jet. The contract is valued at approximately 101.4 billion won ($70 million) and runs through 2028.
KAI signed a one-year pilot PBL contract worth approximately 27 billion won with the Philippines in December 2024, marking the first such agreement with an export customer. Following stable operational performance and high aircraft availability rates, the two parties proceeded to sign the three-year long-term PBL contract.
PBL is an advanced logistics support system that provides maintenance based on operational performance metrics such as aircraft availability and maintenance reliability. The system establishes a stable support framework throughout the aircraft's 30-to-40-year lifecycle.
KAI has maintained stable PBL operations for approximately 15 years since 2010, starting with the Korean Air Force's KT/A-1 and expanding to include the T-50 and Surion helicopter series. The company is leveraging this proven operational experience to build trust with overseas customers and strengthen its global export competitiveness.
The Philippines is a key FA-50 operator for KAI. Since first acquiring 12 FA-50PH aircraft in 2014, the two parties have built a strong relationship of trust through approximately 10 years of stable follow-on support and systematic logistics services. Based on this trust, the Philippines signed contracts last year for an additional 12 FA-50PH aircraft as well as performance upgrades for the original FA-50PH jets exported in 2014.
Following the Thailand PBL contract signed in April last year, the Philippines contract demonstrates that a virtuous cycle is firmly taking hold—starting with aircraft exports, continuing with stable follow-on support, and expanding into additional procurement and upgrade programs, KAI said.
Given that follow-on support costs two to five times the aircraft acquisition price, KAI plans to develop its after-sales support business as a core business segment and continue strengthening it as a competitive differentiator in the global aerospace and defense market.
"We will build customized follow-on support systems optimized for each country's operational environment and requirements for all nations currently operating or planning to operate Korean-made aircraft," said Park Kyung-eun, head of KAI's Customer Support Division. "Through this, we will secure sustainable export competitiveness and further expand our presence in the global aerospace and defense market."
