South Korea's government has voted down a bid by Boeing to supply 60 warplanes, saying it wants a more advanced, radar-evading fighter.
The Government will now will restart the multi-billion tender process and Lockheed Martin's F-35A, previously considered too expensive, has shot to the front of the line in the race for the contract after the defence ministry singled out a fifth-generation fighter as the preferred option.
The fifth generation F-35A, complete with its hi-tech stealth capability, has already been ordered by the USA and seven other countries, including Japan and Israel.
Boeing's F-15 Silent Eagle, the only bid within budget, had been poised to win the 8.3tn won (£4.8bn) tender, but former military top brass and ruling party lawmakers had criticised the plane for lacking stealth capabilities.
"Our air force thinks that we need combat capabilities in response to the latest trend of aerospace technology development centered around the fifth generation fighter jets and to provocations from North Korea," defence ministry spokesman Kim Min-seok told reporters yesterday.
Experts said the phrasing of that statement meant Boeing had a slim chance in the next round. While the F-15 Silent Eagle offered passive stealth, its electronic warfare equipment left it visible to adversaries.
A third bid by the Eurofighter consortium's Typhoon was also ruled out for going over the finance ministry's budget. Under South Korean law, only bids under budget are eligible to win defence contracts.
Experts said a deal with Boeing or Lockheed Martin was most likely because of South Korea's close military alliance with the US against the belligerent North.
The South Korean government and air force will map out a fresh tender process and consider a new budget, possibly reducing the number of planes sought to 40 or 50. The defence ministry said it could take around one year to complete the new tender round.
"DAPA...will swiftly pursue the programme again in order to minimise the vacuum in combat capabilities," South Korea's Defence Acquisition Program Administration (DAPA), which led the assessment of the fighters, said in a statement.