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Minister Lee and Airbus D&S CEO discuss aerospace industry cooperation 2022-11-17

Trade, Industry and Energy Minister Lee Chang-yang met with Airbus Defense and Space (D&S) CEO Michael Schoellhorn on November 16 at the Government Complex Seoul to discuss measures to strengthen the aerospace and defense industry.

Airbus D&S is a division of Airbus SE, the European multinational aerospace corporation, and this meeting was convened on the occasion of the Airbus D&S chief’s visit to South Korea for local management affairs.

Discussions centered on cooperation measures for 1) Korea’s FA-50s’ entrance into the Western European market and advancement of their aerospace collaboration, 2) expanding the scope of Risk & Revenue Sharing Partnership (RSP) items and working together in Urban Air Mobility (UAM) and space industry sectors and 3) building an Airbus R&D center in Korea and new investment prospects.

Noting the recent successful flight test of KF-21 and exports of FA-50s to Poland, the Airbus D&S CEO proposed a win-win strategy by which Korean finished aircrafts can be exported to Western Europe. Airbus plans to increase its current KRW 700 billion worth purchase of shipments manufactured by Korea’s middle-market firms and SMEs to over one trillion won in the future.

He revealed that Airbus is seeking ways to contribute to Korea’s space industry development in view of the nation’s successful launch of Nuri-ho rocket, so as to broaden the range of space cooperation with Korea. Addressing Korea’s push for an aerospace center establishment, he relayed that he will share data on joint project cases involving the European Space Agency (ESA).

Minister Lee concurred with the proposed win-win strategy for Korea’s finished combat aircraft (F-50) exports to Western Europe as it will be a strong momentum for penetrating markets in the U.S. and emerging countries.

He expressed gratitude to Airbus’ plans to expand Korean aircraft imports, and added that giving new items a chance will enhance Korean companies’ technological and production capacity while also diversifying the range of Airbus’ reliable core vendors.

The aerospace industry requires a relatively long period of time (seven years minimum) to proceed from the initial design stage to production as well as massive investment. Not only that, aircraft manufacturers tend to work with core partner companies from the early development phase.

With respect to these factors, Minister Lee stated that Korean companies are looking forward to RSP opportunities to contribute their technological and production prowess, and emphasized the need for an upgrade from module supplier status to Super Tier 1 as Airbus’ core partner.

He added that once the RSP items for collaboration with Airbus are decided, the Korean government will review priority investment for R&D. The Government is currently stepping up efforts to increase FDI and reinforce a private-led, market-oriented economic system.

The Minister conveyed the idea of establishing an Airbus R&D center in Korea to deepen the level of cooperation and mutually beneficial development in not only traditional sectors but also next-generation aerospace industries.

Mentioning Korea’s diverse high-tech IT, highly skilled large-scale production labor force and R&D infrastructure in semiconductors, displays and secondary batteries, he affirmed that an Airbus R&D base in Korea will serve as an important momentum for mutual growth through closer cooperation.

Lastly, Minister Lee assured that upon Airbus’ move for investment, the Ministry will enforce sweeping tax incentives and deregulatory measures to provide a choice investment environment.