Defense

Weeks after North Korea's successful rocket launch, South Korea may take steps to beef up its surveillance capabilities. On Dec. 21, the Defense Security Cooperation Agency formally notified Congress that South Korea has proposed buying four RQ-4 Block-30 Global Hawks for up to $1.2 billion. The sale of Northrop Grumman's high-altitude, long-endurance UAV would help South Korea assume the lead in intelligence gathering as the U.S. plans to dissolve the Combined Forces Command in 2015, notes the agency.

Amy Butler (Washington)
The Pentagon continues to set the standard for research and development spending on missile defense, though purchases from allies are increasingly setting the production pace for regional defense systems. This trend is likely to continue in 2013, as Iran threatens Israel and other U.S. allies in the region.

By Guy Norris
Could optionally piloted vehicles (OPV) be the next wave in cost-effective special-mission aircraft, able to fly in civil airspace with pilot and sensor operator on board but also capable of flying unmanned for far longer duration at lower cost than the Beechcraft King Airs so favored today? Aurora Flight Sciences and Northrop Grumman would answer yes. Aurora is developing the $4.5 million Centaur OPV, and its first buyer is Switzerland's Arma-suisse, which will use it as a flying testbed for unmanned-aircraft airspace integration.

Sunho Beck (Seoul)
Japan's 2013 defense budget faces the biggest drop in percentage terms since 2004, set to contract 1.3% after three consecutive 0.4% reductions since 2010. Japan's security environment, especially around its southernmost islands facing China, is “tougher than ever” according to Prime Minister Yoshihiko Noda, but 20 years of economic stagnation make it increasingly difficult to pay for defense.
Defense

By Guy Norris
Displays are getting personal. As soldiers join the network they need displays, and today's ruggedized laptops are heavy, power-hungry and breakable. The push is on to field lightweight, flexible displays that can be worn on the wrist or integrated into clothing or protective eyewear. The U.S. Army is testing wrist displays, and the U.S. Air Force kneepad touchscreens, produced by L-3 Display Systems using unbreakable plastic-backed organic light-emitting diode (OLED) technology from Universal Displays. These displays are small—only 4.3-in.

By Guy Norris
While privacy concerns bedevil efforts to integrate unmanned aircraft into U.S. national airspace, police departments across the country are pushing ahead with plans to field small unmanned aircraft systems (SUAS) operating under existing rules. The vehicle of choice appears to be a miniature rotorcraft, providing the ease of operation that comes with vertical-takeoff-and-landing and the ability to hover and stare. Canada's Draganfly Innovations has led development of the public-safety market with its 4.5-lb.

AW Staff
After its unveiling of the J-20 and J-31 stealth fighters, it is not unimaginable that Beijing could pull off another technological surprise in 2013. Could it up the superpower stakes by testing an unmanned combat air vehicle, an air-launched strike weapon or even a mini-spaceplane? Speculation abounds.

Graham Warwick (Washington)
An inflection point is approaching for rotorcraft manufacturers and their customers, civil and military, where they must decide whether to invest in de-veloping and purchasing a step change in capability or continue on a path of incremental improvement. The decision is particularly pressing for the U.S. military, which by opting to repeatedly upgrade its existing airframes has fallen behind the commercial world in helicopter technology. The choice now lies between simply catching up with the commercial market, or boldly leaping ahead.

Graham Warwick (Washington)
Decade-spanning factors complicate fighter choices
Defense

Christina Mackenzie (Paris )
A “wait-and-see” banner flies over France's 2013 defense budget, which, like all others for EU defense ministries', has to contract to meet the government's goal of bringing the country's public debt down to 3% of GDP from the current 5.2%.
Defense

By Guy Norris
Routine aircraft-like spaceflight operations could begin in 2013, with Virgin Galactic and XCOR Aerospace flying to the edge of atmosphere, but fully reusable air-breathing space access remains a dream. A crucial step forward could be tests of an air-breathing rocket engine component now underway in the U.K.

AW Staff
Bombardier's future as a major player in the passenger jet business could rest on its new CSeries aircraft. The first flight has been delayed from December until as late as next June, and a key Chinese fuselage supplier fell down on the job. In 2013, Bombardier needs the CSeries to fly and customers to buy. Chinese

Michael Mecham
Just as the aluminum industry profits by turning one soda can into another, aircraft manufacturers are waiting for the day when composite scrap from their assembly lines, or parts reclaimed at an aircraft's end-of-life, can be made flyable again.

AW Staff
Asian investors continue to take big stakes in the aircraft leasing market. A consortium of three Chinese investors plans to close on a deal to acquire the International Lease Finance Corp. That follows earlier sales of Jackson Square Aviation and the Royal Bank of Scotland's aircraft leasing business to Japanese buyers and Singapore Aircraft Leasing Enterprise's acquisition by the Bank of China.

By Guy Norris
Unmanned vehicles able to accompany troops and alleviate their loads have made a debut in Afghanistan, but if autonomous systems are truly to carry the burden they must be able to go wherever the soldiers go. Darpa's Agency's Legged Squad Support System (LS3) program aims to develop a four-legged robot that can carry 400 lb. and follow soldiers over rugged terrain, interacting like a trained animal with its handler. After initial outdoor trials early in 2012, Boston Dynamics is refining its LS3 for a U.S. Marine Corps field exercise in 2014.

Nothing reveals the political nature of this year's debate over across-the-board budget cuts as much as the dramatic change of discourse in the weeks leading to the deadline for preventing them. After a year of hearings, press conferences and road shows clamoring for a stop to sequestration, lawmakers and the Obama administration are now met with the deadline. Late last week, they appeared to have rationalized missing it.

David Eshel (Tel Aviv)
Defense budget negotiations in Israel are on ice until after the Jan. 22 elections. However, the costs of Operation Pillar of Defense—aimed at eliminating the rocket threat from Hamas—will complicate an already difficult situation.
Defense

Bill Sweetman (Washington)
In the run-up to November's election, the U.S. aerospace and defense industry and its lobbyists were in favor of any budget proposal that left defense expenditures free to continue growing. Republican candidate Mitt Romney promised to peg defense to 4% of gross domestic product, but his attempt to make defense a key issue gained little traction. As Stimson Institute senior fellow Gordon Adams put it: “This election was not about defense. A very large and expensive lobbying effort to make it about defense failed.”
Defense

Graham Warwick (Washington)
Once there were two major producers of military transports that dominated the world stage: the U.S. and the Soviet Union. Today, the U.S. has only two airlifters in production and has ceded the light-transport market to European competitors. The once-mighty Russian industry is making a comeback, but new competitors have emerged in Brazil and, potentially will develop in China.
Defense

By Guy Norris
Unmanned vessels are about to take a leap in capability, on the surface and beneath. The desire for persistent sensing is driving the need to develop fully autonomous, long-duration vehicles that can covertly patrol coastal waters or overtly follow submerged submarines. The U.S. Office of Naval Research plans to build prototypes of the Large-Displacement Unmanned Underwater Vehicle (LDUUV) to address the autonomy, sensing and energy challenges of a vessel able to operate independently for months.

Amy Butler (Washington)
To lower costs, Pentagon could turn milsat procurement on its head.

AW Staff
North Korea's successful launch of a satellite in December after 14 years of attempts put the hermit kingdom one step closer toward deploying an intercontinental ballistic missile. And Iran's nuclear weapons program—and the threat of an Israeli attack to cripple it—will keep tensions simmering in the Middle East.

By Joe Anselmo
When I began writing this column eight years ago, airlines were reeling as oil prices soared above $50 a barrel. Lockheed Martin was hoping to ramp up production of the Joint Strike Fighter in 2009, and Wall Street analysts were beginning to question whether a run-up in defense stocks had much steam left. Airbus was preparing to launch development of the A350 in response to Boeing's 7E7 (now 787), and the business jet market was embarking on a sales surge that would end in a spectacular crash.

Graham Warwick (Washington), Larry Dickerson (Forecast International)
Unmanned-aircraft manufacturers are approaching a crossroads. The wars that fueled the market's dramatic growth are winding down. International demand is growing but bringing with it increased competition. And the civil market is slow to start, and initially focused on small systems that cannot match the military business in sales value.

By Jay Menon
Challenges from archrivals Pakistan and China, and their growing arms capabilities, have forced India into a modernization drive, and its defense budget is expected to touch $50 billion in the next fiscal year. The Indian defense sector has been growing at an unprecedented rate and is now the world's leading weapons importer. A Swedish think tank that monitors global arms sales verifies that India's weapons imports have overtaken China's, which are now in second place, with 6% of global imports, as Beijing continues to build up its domestic arms industry.
Defense