With Taiwan's push for 66 new F-16 C/D fighters in limbo, its state-owned aerospace firm is working towards securing a definitive agreement with Lockheed Martin on the upgrade of the country's fleet of 144 F-16 A/Bs by the end of the year.
"We're now in discussions. The modifications will be done at our hangars, it seems Lockheed will do the design, development and testing, while we will do the hands-on modifications," says Lee Chung-Huang, vice-president of the Aerospace Industrial Development Corporation's (AIDC) military business development.
"We're now talking about the schedule and scope of the upgrade."
In October 2012, the US government awarded Lockheed a foreign military sales (FMS) contract worth up to $1.85 billion to upgrade the avionics of the fleet. Lockheed has said that the retrofit programme will include the addition of an active electronically scanned array (AESA) radar, embedded global positioning, as well as upgrades to the electronic warfare and other avionic systems.
While a major question mark hung over the provider of the AESA radar for a long time, executives at the Taipei Aerospace & Defense Technology Exhibition say that Northrop Grumman's Scalable Agile Beam Radar (SABR) appears to have emerged the winner over Raytheon's Advanced Combat Radar.
Taiwan had effectively outsourced its AESA selection to the USAF, which recently selected SABR for its own F-16 radar programme, thereby confirming SABR's win in Taiwan.
Lee says Lockheed will upgrade the first two F-16s in the USA, and thereafter, AIDC will do the modifications in Taiwan. The upgrade will likely start in 2016, and is expected to take some five years to complete, he adds.
Lockheed's programme director for Taiwan's F-16 retrofit programme Mark Rodenberger was non-committal when asked about details of the programme and negotiations with AIDC.
"The project is massive, complex and difficult," he says. "AIDC is very capable and we're most impressed with them."