South Korea Makes Good on Chink in European Arms Market
South Korea’s political and strategic ties with Europe are on the ascendancy. In recent years, in particular, the countries of Northern and Central Europe have grown to become important customers for the South Korean arms industry. A number of factors have contributed to this, but with the Russian invasion of Ukraine, political reasons have come to the fore.
The presence of ‘made in ROK’ military equipment in the region began in 2014 when Poland selected the K9 Thunder self-propelled gun chassis for its AHS Krab SPG. The agreement covered the licensed production of 120 chassis. The South Korean industry sensed an opportunity and began offering Poland a tailor-made version of its latest K2 Black Panther main battle tank – K2PL. However, the time of the K2PL has not yet arrived.
Further successes came relatively quickly. In 2017, Norway ordered 24 K9 SPGs and 6 K10 Ammunition Resupply Vehicles. In the same year, Finland ordered 48 K9 with an option for 48 more. Then, in 2018 Estonia placed an order for 12 K9 from South Korean stockpiles with an option for 12 additional systems.
As tensions in Europe grew, customers started to take up options. In 2021, Finland ordered 10 additional vehicles. Orders sprinkled in with the outbreak of the Ukraine war. Finland bought all the optional K9s (96 in total). Estonia did the same and then ordered 12 more (36 in total). Norway, in turn, bought another 4 K9s and 8 K10s (28+14 in total).
Poland, meanwhile, signed a record contract for 212 K9s and 180 K2s, part of which is to be produced under license. The question is why did Warsaw decide to start production of a second type of SPG instead of increasing production of the AHS Krab. The K2, on the other hand, is generally assessed as being too lightly armored for the European theatre of operations. Therefore, a better-protected version the K2PL is to be developed for the Polish army. Nevertheless, the introduction of another MBT type is debatable as well.
In autumn 2022, a new product of the South Korean defense industry – the K239 multiple rocket launcher – entered the scene. Norway expressed interest in the system in September but only signed an MoU. In October, Poland signed an agreement for the procurement and licensed production of 288 vehicles. The first systems are to be handed over this year. The K239 could prove to be another hit. It is cheaper and more capable than the U.S. M142 HIMARS. Thus, K239 is particularly attractive to former Eastern Bloc countries looking for replacements for Soviet rocket artillery.
It is worth noting that, for the time being, interest in South Korean weapons is limited to ‘heavy metal’, and we can only speak of widespread success with the K9. So, how did this SPG win export orders, beating all competition? The success is all the more remarkable considering that all European customers are members of NATO (Estonia, Norway, Poland) or will join the alliance soon (Finland). It is a market almost by definition dominated by arms companies from Europe and the U.S.
Why South Korea?
In all tenders, tactical and technical requirements are only responsible for a part of the evaluation. Price also plays a major role. However, it is difficult to compare with the K9’s main competitor in Europe, the German PzH2000. In most of the contracts, Germany sold howitzers from its stocks; factory-new vehicles were only purchased by Hungary but the value of the contract is undisclosed. Nevertheless, the price and the cost-effectiveness ratio must be satisfactory in the case of the K9. Economies of scale play a significant role here; the ROK ordered at least 1,300 SPGs for its armed forces alone while the total production of the PzH2000 was about 380.
The delivery rate also plays a big role. Due to large orders from its own armed forces, the South Korean arms industry can maintain a large production capacity. At the same time, the ROK military has large equipment stockpiles, which are also used as a source of vehicles for export. Pre-war deliveries to Estonia, Finland, and Norway began less than two years after the contract was signed and were completed over the following two years. In comparison, the delivery to Lithuania of 21 PzH2000s from the Bundeswehr reserves took nearly seven years. However, much depends on the nature of the contract. Deliveries of 16 second-hand PzH2000s to Croatia started one year after the contract was signed and were completed within two years.
The advantages of buying weapons from South Korea became even more apparent after the outbreak of the war. Poland signed a contract for the K2 and K9 in August 2022, with the first vehicles coming from ROK military reserves and the current production already delivered in December. The ability to execute contracts quickly is essential for countries transferring arms to Ukraine, and who thereby need to fill the resulting equipment shortages as soon as possible.
In addition, unlike German or U.S. companies, the South Korean defense industry is very willing to share know-how, transfer technology. Moreover, it invites customers to participate in further R&D. For the time being, there are also no reports of political annexes to arms deals imposing restrictions on the user’s capability to deploy systems. The path was blazed by Turkey, where the K2 and K9 were used to develop Altay MBT and T-155 Firtina SPG.
There is a good reason for this policy. The South Korean arms industry is only just breaking through the global markets. A high degree of openness to cooperation makes it possible to win and keep customers among countries that already have their own arms industry or want to create one.
With Russia’s aggression against Ukraine, political factors have begun to gain importance. Germany is one of the main donors of military and humanitarian aid to Ukraine. However, Chancellor Scholz’s overly cautious and procrastinating policy, combined with a disastrous communication policy, undermined confidence in Germany as a reliable ally. Especially on NATO’s eastern flank, the question of how Berlin will act in the event of a conflict with Russia is of particular importance.
In the case of Poland, the choice of K2 and M1 Abrams to replace Leopard 2 as the principal tanks for the coming years can be attributed to the fraught relationship between Warsaw and Belin. However, similar concerns about Germany’s loyalty as an ally have also arisen in other Northern and Central European capitals.
In Norway, the military has recommended abandoning the purchase of a new MBT, the successor to the Leopard 2A4NO, and buy instead attack helicopters and long-range artillery. The Leopard 2A7 and the K2NO were competing for the contract. Finally, in February 2023, Norway chose the Leopard 2. The decision was explained by the desire to integrate the equipment with other Nordic states. The existing infrastructure also played an important role. In Europe, the Leopard 2 is used by 13 armies of NATO countries.
The Czech Republic and Slovakia also signalized interest in purchasing Leopard 2A7. However, when it came to new infantry fighting vehicles, both countries chose the Swedish CV90 instead of Rheinmetall’s heavily promoted Lynx IFV.
These consecutive failures in bids other than tanks are considered a reputational blow to Germany. The Koreans, but also the Americans, are trying to exploit the opportunity. There are speculations that European allies, in replacement for their Leopard 2s sent to Ukraine, may receive M1 Abrams tanks from the U.S. reserves.
South Korea can deliver new tanks, albeit not as quickly, and with weaker armor. The K2PL could change this situation. Improved tanks, after all, have yet to be produced. The German arms industry is in a similar situation. After long pressure from allies, Berlin changed its policy and agreed to hand over used Leopard 2s to Ukraine. These tanks must be replaced by new vehicles, which, however, will have to be produced. Currently, it takes nearly three years to build a Leopard 2A7. This gives an advantage to the U.S., which can quickly offer stockpiled M1 tanks.
Such a swap will mean opening up the European armor market to the U.S. and tying up the allies for the next dozen years. The Germans will be able to retake the market when MGCS is available for export. There are already claims in Germany that it has been a mistake to limit the next-generation European tank project only to the German-French partnership.
The tender for new tanks from Romania could signal how the fate of European armor will turn out. The Leopard 2 and M1 Abrams are competing, but the K2 is also mentioned among the candidates. The South Korean arms industry has already gained a strong foothold in Europe; whether it will be able to expand further only time will tell.