Lockheed wins approval for F-16 upgrade deal with South Korea

Lockheed Martin has won U.S. government approval of a deal to upgrade 134 F-16 fighter jets for South Korea, a program previously awarded to BAE Systems.

According to a statement from the Pentagon’s Defense Security Cooperation Agency, the State Department has approved the sale for an estimated $2.5 billion. The agency notified Congress of the possible sale Tuesday. It has 30 days to object.

BAE originally beat out Lockheed for the South Korean deal and set up shop at Fort Worth’s Alliance Airport to develop the new electronics systems. Last May, the first two F-16s from South Korea arrived at a hangar at Alliance as work on the program began.

But last fall, South Korea expressed displeasure with projected cost increases for the program, originally estimated at $1.3 billion. According to Reuters, the U.S. government had indicated that the new cost would be $2.1 billion to $2.4 billion.

South Korea canceled its contract with BAE in November, leading BAE to shut down the Alliance operation and lay off about 190 workers.

According to Reuters, South Korea is looking to upgrade the Lockheed-built F-16s to include modular mission computers, scanned array radar, friend-or-foe identification systems, navigation systems and radar warning systems, among other items, the agency said.

“Lockheed Martin stands by ready to support the Republic of Korea and its F-16 upgrade plans. Discussions are ongoing,” the company said in a statement.

Lockheed has made more than 4,500 Fighting Falcons in west Fort Worth.

The Korean government and BAE Systems are involved in litigation over the canceled contract.

This story was originally published July 16, 2015 at 9:57 AM with the headline "Lockheed wins approval for F-16 upgrade deal with South Korea."