Squad Automatic Weapon (Phase 2) Joint Acquisition Project of the Philippine Army and Philippine Navy (Marines)

With the continuing need for new Squad Automatic Weapons (SAW), the Philippine Army (PA), together with the Philippine Navy on behalf of the Philippine Marine Corps (PMC) requested for the acquisition of new 5.56x45mm light machine guns, that would be distributed to front line units of both services.

As a continuation of the success of one of the AFP Modernization Program's first Capability Upgrade Program, the Squad Automatic Weapon (Phase 2) Joint Acquisition Project of the Philippine Army and Philippine Navy (Marines) called for the purchase of 6,540 new SAWs as an initial procurement. 

A Philippine Army infantryman with a K3 squad automatic weapon. Photo credits to the Philippine Army.

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Project Summary:

Squad Automatic Weapon (Phase 2) Joint Acquisition Project:

Note: Edited as of 23 April 2025.

* End User: Philippine Army and Philippine Navy (Marines) (multiple units)

* Quantity: 6,540 units

* Modernization Phase: Capability Upgrade Program of the AFP Modernization Program (RA 7898)

* Project ABC: Php1,727,438,000.00, increased from original Php613,894,000.00

* Acquisition Mode: Public Bidding

* Source of Funding: GAA Funds through AFP Modernization Program Trust Fund

* Winning Proponent: Joint Venture of Hanwha Corporation and S&T Daewoo

* Product for Delivery: S&T Daewoo K3 5.56x45mm Light Machine Gun

* Contract Price: Php1,210,725,915.00

* Residual Difference (Savings): Php516,712,085.00

* First post by MaxDefense: TBC

* MaxDefense Searching Hashtag: #PAPMCSAWPhase2Acquisition

* Status: Initial project has a lower budget and quantity requirement, and was awarded to FN Herstal in 2013 and Contract signed on 13 July 2004. Project was put on hold after allegation of overpricing and irregularities on implementation. Project was restarted with a higher budget and quantity requirement in 2007, with Joint Venture of Hanwha Corporation and S&T Daewoo was declared the Lowest Calculated Responsive Bidder, and Notice of Award released on 15 June 2007. Initial batch of 700 units delivered on 03 December 2007, with the rest delivered by June 2008. PROJECT COMPLETED.

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Overview:

With the success of an earlier procurement of Squad Automatic Weapons for both the Philippine Army and Philippine Marine Corps, a new requirement was raised in 2003 for a total of 1,700 units with a proposed Approved Budget of Contract (ABC) worth Php613,894,000.00.

The new SAWs are expected to arm infantry and marine units and replace older machine guns which consist of older variants of the venerable M60 7.62mm general purpose machine guns (GPMGs) which are very heavy especially for smaller Filipino physique compared to the M60 which was designed for use by larger caucasian or black soldiers of the US Armed Forces.

An M60E3 at the hands of a squad automatic rifleman. Reliability has been an issue with these machine guns, as well as weight due to their design and use of larger 7.62x51mm NATO rounds.

The SAWs are also expected to replace a number of non-standard models including the Singaporean-made CIS Ultimax 100, and other models.

Back then, the Philippine Army and Philippine Marine Corps only has a few light machine guns in service. Aside from the few hundred FN Minimi LMGs acquired under the Phase 1 of the SAW Joint Acquisition Project, volume fire support was provided by M60 GPMG, which are also in limited quantity in both services.

The CIS Ultimax 100 5.56x45mm light machine gun, which was availability in very limited numbers in PA service. Photo taken from Wikipedia.

To have commonality with the earlier acquisition of FN Minimi, the DND directly negotiated with FN Herstal in 2003 for the acquisition of 1,700 light machine guns with a budget of Php613,894,000.00.

Both parties signed a Contract by 13 July 2004, and the Notice to Proceed released on 06 September 2004.

Allegations of fraud and overpricing surfaced considering the average price of each FN Minimi LMG was valued at around Php361,114.00, which is too high at that time.

It was also found that the deal failed to meet the requirements of Republic Act 9184 due to the use of foreign currency, as well as requirements of the National Economic and Development Authority (NEDA) with regards to pricing for follow-on acquisitions.

Pressure from lawmakers and other groups forced the DND to review the contract and ultimately cancel it, with FN Herstal being against the cancellation.

Due to the urgency of SAWs in both ground services, the DND again raised the need to restart the project, which it did in 2007 when it released new technical specifications and Invitation to Bid, this time under a Public Tender.

The budget was increased from Php613,894,000.00 to Php1,727,438,000.00, and the quantity was also increased from 1,700 units to 6,540 units. This gives an average budget of Php264,134.00 per LMG, which is almost 27% lower than the average price in the earlier contract with FN Herstal.

During the public bidding, FN Herstal participated with their Minimi as their offer, competing against several other tenderers, with the Bid Submission scheduled on 30 March 2007.

Eventually the Joint Venture of Hanwha Defense and S&T Daewoo submitted the lowest bid and also passing the Post-Bid Qualifications, with an offer worth Php1,270,725,915.00, or an average of Php194,300.00 per LMG.

The Notice of Award was released on 15 June 2007, and the Letter of Credit opened on 21 November 2007.

S&T Daewoo showed their capability to deliver quickly when they delivered the first batch of 700 units by 03 December 2007, while the rest of the orders were delivered in full by June 2008.

The DND declared the project as Completed as of August 2008.

Since their delivery, the S&T Daewoo K3 became the most prolific light machine gun / squad automatic weapon in both the Philippine Army and Philippine Marine Corps.

An automatic rifleman with the Philippine Army, now sporting the S&T Daewoo K3 SAW. Photo credits to the Philippine Army.

The increase in quantity in the K3 SAWs has allowed both the Philippine Army and Philippine Marine Corps to capitalize on this by replacing the M60 as Squad Automatic Weapon, while also allowing for carrying more ammunition due to the use of the smaller and lighter 5.56x45mm NATO rounds.

This gave automatic riflemen longer staying power in providing fire support, while the reduced weight of the SAW gave them better flexibility especially in movement.

A typical Philippine Army Infantry Squad in the 2020s, with the automatic rifleman from both Fire Team A and B using the K3 5.56mm SAW. Photo credits to the Philippine Army.

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With the Minimi SAWs already delivered and formally activated with different units of the Philippine Army and Philippine Marine Corps, MaxDefense officially consider the Squad Automatic Weapon (Phase 2) Joint Acquisition Project of the Philippine Army and Philippine Navy (Marines) as COMPLETED.

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First posted and released on 26 April 2025.
Copyright MaxDefense Philippines / Philippine Defense Resource