Korean Air and European aerospace giant Airbus have signed an agreement to jointly bid for an $8-billion jet fighter project, an airline spokesman said Sunday, pitting them against a team comprised of Lockheed Martin and Korea Aerospace Industries.
The project is designed to develop and produce 120 fighter jets to replace the country's ageing fleet of F-4s and F-5s.
"We've signed a memorandum of understanding with Airbus," a Korean Air spokesman told AFP.
One of the conditions of the bid is that local enterprises should tie up with foreign companies to secure technological assistance, according to Seoul's Yonhap news agency.
The pair will compete with Korea Aerospace Industries, which has teamed up with America's Lockheed Martin.
South Korea's Defence Acquisition Programme Administration plans to announce the final winner in July.
The country's military has overwhelmingly chosen US suppliers in the past, especially where the air force is concerned, reflecting their close military alliance.
But Airbus has also made a number of bids for the South's military contracts in recent years, including a $1.38 billion deal to provide air refuelling tankers. The final bidder for the deal has not been chosen yet.