Monday, July 27, 2009

Production of KAI KT-1 Trainer to Top 50 Aircraft During 2009-2018

The Turkish Air Force ordered 40 KT-1s and took options on another 15 aircraft in July 2007. These aircraft will be produced jointly by KAI and Turkish Aerospace Industries (TAI). Under the terms of the contract, KAI is building the first five aircraft in Korea. Deliveries of these aircraft are scheduled to begin by the end of 2009. Forecast International projections call for the remaining 35 aircraft covered by the contract to begin rolling out of TAI's facility in 2010 and deliveries under the full 40-aircraft order to be completed by the end of 2011. This forecast assumes that Turkey will exercise its 15-aircraft option, extending deliveries into 2014. Turkey is currently the only customer for the KT-1. The South Korean Air Force has ordered a total 85 KT-1s and 20 FAC variants since 1999, but all of these aircraft have been delivered. Indonesia ordered seven KT-1s in 2001 for delivery in 2003. It later received another five aircraft and has options on the books for another eight KAI continues to develop the more advanced KT-1C, which features updated avionics and an expanded armament capability. The company has also indicated that it is at work on a new ?Enhanced Trainer? designated the XKT-1C that features a full glass cockpit and other upgrades. The primary competition for the KT-1 on the world trainer market includes Embraer's Super Tucano, the Pilatus PC-9 and PC-21, and Hawker Beechcraft's T-6. Although KAI was able to beat out the Super Tucano for the Turkish order, that competition offered little guidance as to the aircraft's future prospects because it did not need to go up against Pilatus' PC-21, which was excluded from the competition by the Turkish government because of political differences with the Swiss government. Finding another export customer is complicated by the limited experience that potential customers have with aircraft made by KAI. Unlike Embraer and Pilatus, which both have sold earlier models of trainers to many different customers around the world, KAI is a relatively new player that cannot rely on past relationships with customers to help secure new orders. Hawker Beechcraft is a third strong competitor, and its status as supplier of hundreds of new T-6 trainers to the Pentagon gives potential customers of the T-6 confidence that the development cost of future upgrades to the aircraft will be largely borne by the U.S. government. KAI thus faces very strong competition in the turboprop segment from a position of weakness. Without new orders, the line will shut down before the end of the forecast period.


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