'90% Localized' K2 Tank Hits Jackpot With Fast Delivery: "Independent Supply Chain Is Export Key"

[CORE POWER KOREA] Weapons Production Systems to Shape the Future of Defense K2, K9 Rapidly Supplied on Domestic Materials and Parts Base Demand From Many Nations Strengthens Market Dominance Aircraft Engines for Fighters Monopolized by U.S., U.K. China Pours 10 Trillion Won a Year Striving to Catch Up "Technological Independence and Self-Sustaining Ecosystem Are Key"

Politics|
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By Lee Hyun-ho
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null - Seoul Economic Daily Politics News from South Korea

The KF-21 Boramae, South Korea's homegrown supersonic fighter jet, is regarded as a next-generation growth engine that will lead the future of the country's defense industry. Yet there is a hurdle it must clear to expand overseas exports. While the localization rate stands at about 65% for early production models, the rate for the engine—the heart of the fighter—is just 39%.

The F414-GE-400K engine mounted on the KF-21 was developed by U.S.-based GE Aerospace and is produced domestically by Hanwha Aerospace through technology licensing. Because the engine is subject to the U.S. State Department's International Traffic in Arms Regulations (ITAR), exporting the KF-21 to a third country requires approval from the U.S. government. In other words, although the fighter platform was independently developed, its export autonomy remains constrained.

The bigger problem is that there is no clear alternative. A full transfer of core engine technology is virtually impossible, as the world's leading defense powers classify advanced aircraft engines as national strategic technologies and control them strictly. Ultimately, analysts point out that to strengthen dominance in the global defense market, South Korea has no choice but to achieve aircraft engine technology independence while building a supply chain for materials and components.

The global aircraft engine market is currently a virtual oligopoly dominated by three firms: GE Aerospace and Pratt & Whitney (P&W) of the United States and Rolls-Royce of the United Kingdom. These countries maintain market dominance by restricting technology transfers while securing supply chains ahead of rivals.

Jang Won-jun, a professor of advanced defense studies at Jeonbuk National University, said, "The future defense market is a competition over supply chains, not finished products," adding, "Securing aircraft engine technology means lifting the competitiveness of the entire national industrial ecosystem, beyond the ability to build a single fighter jet."

Aircraft engines are often called the "sum of mechanical engineering." Top-tier technological capabilities are required across all areas, including raw materials, design, machining, testing and evaluation, and certification. They are far more technically demanding than industrial or power-generation gas turbines, so even a national-level independent development effort requires astronomical costs and long-term investment.

null - Seoul Economic Daily Politics News from South Korea

The high entry barriers for aircraft engine development are also evident in China's case. China previously pursued the acquisition of a Ukrainian aircraft engine company, but after failing, it shifted toward independent development. It then invested about 900 billion yuan (about 207 trillion won) and spent nearly 20 years developing engines for fighter jets and commercial aircraft.

It was a large-scale project that included not only fighter jet engines but also the development of commercial aircraft engines and the construction of testing and certification infrastructure. Despite investing around 10 trillion won annually on average, China is still assessed to fall short of the technological level of advanced countries such as the United States and the United Kingdom.

By contrast, South Korea already possesses weapons systems that have proven their competitiveness in the global market through supply chain independence. Representative examples are the K2 tank and the K9 self-propelled howitzer.

The K2 tank has a localization rate of about 90%, including its core component, the engine. On this basis, it has secured superior supply capability compared with rivals such as Germany's Rheinmetall. In particular, because its main supply chain is built around domestic firms, rapid production and delivery are possible.

In fact, Hyundai Rotem delivered its initial batch within months of signing a K2 tank export contract with Poland, astonishing the European defense industry. By contrast, some European rivals have failed to meet delivery deadlines due to supply chain disruptions.

According to British military intelligence firm Janes, the K2 tank is projected to capture a 19.2% share of the global tank market in 2032, ranking second in the world behind the Abrams tank made by U.S.-based General Dynamics (22.1%).

The K9 self-propelled howitzer is also a flagship K-defense weapons system that holds the world's No. 1 position, with a global market share of more than 60%. Its localization rate is about 70%, and like the K2 tank, most of its supply chain consists of domestic firms, enabling rapid delivery.

In particular, the K9 has built a tightly integrated supply chain in which most core components—including the diesel engine, transmission, gun barrel, high-explosive rounds, and precision-guided munitions—are produced domestically. This is considered a key factor underpinning the K9's competitiveness in the global self-propelled howitzer market.

Kwon Chang-mo, head of the tank program team at the Defense Acquisition Program Administration (an Army colonel), said, "The biggest reason the K2 tank is highly regarded in the Polish market is fast delivery," adding, "Because we have built a domestic supply chain based on technological independence, with a localization rate exceeding 90%, production is fast and price competitiveness is excellent."

He continued, "Ultimately, the core of defense competitiveness is technological independence and control over the supply chain," emphasizing that "the more a weapons system has a localized supply chain, the higher its export competitiveness is bound to be."

What is "Core Power"?

It refers to the independent and irreplaceable capabilities a country has secured in each domain, including technology, security, diplomacy, administration, and culture.

Original reporting by Lee Hyun-ho for Seoul Economic Daily.

AI-translated from Korean. Quotes from foreign sources are based on Korean-language reports and may not reflect exact original wording.

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