Korea Aerospace Industries (KAI) is partnering with Lockheed Martin to bid for the estimated $1bn Israel Air Force (IAF) aircraft deal.

The partnership is considered of benefit to Israel in utilising the US foreign military funds it receives to purchase the aircraft.

KAI’s T-50 supersonic trainer and Italy’s Alenia Aermacchi M-346 Master are currently being considered by IAF to replace its aging fleet of A-4 Skyhawks.

The A-4 Skyhawks are used by IAF to train cadets during their advanced pilot training.

The Jerusalem Post reports that the Italian government had proposed to offer its M-346 aircraft in exchange for two AWACS aircraft from Israel Aerospace Industries.

The final decision on the deal is expected in the beginning of 2012.