The budget for a project to enhance the South Korean Air Force's key fighter aircraft, the F-15K, has risen by over 1 trillion won ($697 million) due to increasing labor and material costs in the defense industry, according to the country's arms procurement agency.

The Defense Acquisition Program Administration announced that the agency's defense acquisition program promotion committee has approved the final plan for the project on Monday.

With a focus on improving the key aviation electronics systems of the F-15K, the project will cost 4.56 trillion won, or approximately 77 billion won per aircraft. The Air Force currently operates 59 of these fighter aircraft, which have been in service since 2005.

The budget was initially estimated at 3.46 trillion won when the plan was first discussed in December 2022. The agency explained that the budget increase stemmed from global inflation in material and labor costs.

“The increase is attributed to the reshaping of supply chains in the defense industry, driven by the shrinking number of manufacturers, as well as rising labor and material costs in the aircraft manufacturing sector,” the agency stated.

The avionics enhancement is expected to replace the current mechanically pivoting radar with advanced active electronically scanned array (AESA) radar, enabling the aircraft to process information up to 1,000 times faster. The plan also includes expanding the computing system's memory and upgrading the partially automated electronic warfare equipment to a fully automated system.

The agency added that these upgrades are aimed at enhancing “target recognition, targeting capability, and survivability, enabling the F-15K to more effectively carry out long-range missions and maximize its weapon-carrying capacity.”