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STAGE 2: Compromising on actual target: asking for both jets and tech -…
STAGE 2: Compromising on actual target: asking for both jets and tech
STAGE 3: Detailing agreement
:red_flag:
Time
If US offers to provide tech + jet asap
KOR asking when and why?
Kor's argument: NK is already developing technology & US can deliver jet before tech
SUGGESSTION:
February: 3 months for Congress's approval
May: After vaccine for Covid
August:
LATEST ACCEPTANCE
:red_flag:
KOR's target:
Jet: 5 - 10/2021
Tech: 8 - 12/2021
Payment
Start with Kor's target: 10% - 40% - 50%
Kor's argument: too risky to pay too much in advance because of the previous contract breach
=> 50% - 50% as bargaining backup for either time issue or price issue
Training fees and warranty fees
Kor will pay training fee if the training is held in Kor
Kor's argument: it's common practice for seller to cover warranty fees during the first few years
1 year training in Korea
Arbitration in Singapore
Common practice
STAGE 1: Coming strong on Korea's target: Technology transfer
THE US
Korea may use technology transferred to develop its own weapon and sell to other country => Other countries will change supplier from the US to Korea?
National security?
US's law limitation
Korea HAS to buy from the US as it is the most competitive supplier with most advanced technology
Other suppliers are lagging behind
Transferring tech cannot maximize profit => Insist on selling as many jets as possible with as much money as they can (may increase price)
KOREA
Both parties can have contract with binding terms to avoid misunderstanding
Korea only wants to use technology for domestic research & application with potential upgrade, not for sale
US's cooperation is beneficial to strengthen US-Kor relationship, especially amid the rise of NK's threat and weapon trial
in return: Kor can increase US's inland army
This also supports Biden's policy on NK
Kor can always find other suppliers: Germany, EU, Israel
If they're lagging behind, Kor can wait, also the later the technology, the more advanced it may be
Lockheed broke the contract before
Now Sikorsky as a subsidiary has to compensate
If not all 100% of tech, how about removing sensitive tech and transfer the rest?
Already transferred 21 tech in F-35 bought from the US in 2015 => why not again
Lockheed transferred tech of F-16 to India in 2018
Buying 30 at minimum with transfer of available tech, with price = 14 mil
:red_flag: Ask for discount as Kor can only buy 32 jets with current expected price
Budget: US$460,410,000 = 40 jets x US$11,510; 35 jets x US$13,150; 30 jets x $14 mil
Russia's KA-50 have doubled the maximum speed and radius compared to UH64 but only 16 mil
Other supplier: South Africa's black hawk is limited for domestic use but we do not use it for domestic purpose, we use it for war combat with North Korea