[Yang Nak-gyu's Defense Club] US Now Demands Increase in Weapon Maintenance Costs

[Asia Economy Reporter Yang Nak-gyu] The United States is expected to face controversy as it demands a significant increase not only in defense cost-sharing but also in logistics support fees for U.S.-made imported weapons. In particular, for the recently acquired high-altitude unmanned reconnaissance Global Hawk (RQ4), the U.S. has proposed a logistics support fee up to four times higher than last year’s cost, raising concerns that the operational maintenance costs for our military will increase substantially.

According to military authorities on the 22nd, Northrop Grumman, the U.S. manufacturer of the Global Hawk, is requesting a contract for contractor logistics support (CLS) that provides logistics support only up to the contracted amount, demanding an amount four times higher than last year’s contract for the next two years. The Global Hawk is supported directly by Northrop Grumman. This differs from the performance-based logistics (PBL) contracts for existing fighter jets such as the F-15K and F-35, where manufacturers provide maintenance, repair parts, and technical support, and payments are made based on operational rates.

Since the first Global Hawk was introduced in December 2019 until November this year, our military has signed contracts worth 59.1 billion KRW (53.8 million USD). Under this contract, Northrop Grumman dispatched 28 employees to Sacheon Air Base to develop educational materials as well as conduct maintenance and operational training.

However, the newly added contract period from December this year to November 2022 spans two years with a contract amount reaching 389.8 billion KRW (354 million USD). The annual maintenance cost is 194.9 billion KRW, about four times higher than last year’s contract amount. Including technical support for video interpretation equipment (50.3 billion KRW) and simulated flight training operation and maintenance (2.9 billion KRW), the two-year maintenance cost for the Global Hawk inevitably rises to 443 billion KRW. Considering that one set consists of four units, the annual maintenance cost per unit is 55.37 billion KRW. Last year, the annual maintenance cost per unit was 14.775 billion KRW.

The military states that due to the Global Hawk’s characteristics?such as advanced communication, satellite technology, and expensive optical and infrared imaging equipment?the increase in maintenance costs is unavoidable. The Global Hawk is operated in only about 50 units by the U.S. and NATO, making production costs and parts prices relatively high.

The operating cost per unit of the F-35A stealth fighter, which our Air Force is currently acquiring, will also see a significant increase. By March last year, the military had forecasted a total budget of 608.4 billion KRW, including follow-up logistics support (526.2 billion KRW) and technical support such as electronic warfare threat data updates (36 billion KRW). However, last year, the U.S. side increased the technical support cost, including electronic warfare threat data updates, to 68 billion KRW, nearly doubling the amount. The electronic warfare threat data update refers to data that allows the F-35 to distinguish between friend and foe and identify enemy threat elements during flight.

Therefore, from this year, operating the F-35 is expected to require 653.2 billion KRW, including follow-up logistics support (557.2 billion KRW). The operating cost per unit is 4.78 billion KRW, an increase of 330 million KRW per unit compared to last year. Considering that the annual maintenance cost of the F-16 fighter is 1.8 billion KRW, this is more than twice as expensive.

A military official said, "In the case of the Global Hawk, we plan to secure maintenance capabilities within the military early on to reduce technical support personnel, and we expect repair unit costs to decrease if other countries such as Japan also acquire the Global Hawk."