Interest Support Program for Shared Growth Funds

KAI provides 100 billion won of loan interest support for investment and working capital through agreements with Gyeongsangnam-do and the Korea SMEs and Startups Agency. As of 2023, KAI has provided 34.3 billion won of loan interest support to a total of 33 small and medium-sized enterprises.

Emergency Funding for Business Crisis

To assist suppliers facing temporary business challenges, KAI established an emergency operating fund and doubled its size from KRW 10 billion to KRW 20 billion. The per-company loan ceiling was raised from KRW 1 billion to KRW 2 billion, and loan terms were eased by introducing a grace period. As of now, KRW 43.23 billion has been disbursed to 22 companies.

Collaborative Cooperation Loan Guarantee

To facilitate SME financing, we contributed KRW 180 million to a collaborative cooperation fund, which offers loan guarantees of up to KRW 3 billion per company. To date, we have guaranteed KRW 2.7 billion in loans for three companies. In November 2024, we also signed an agreement with the Korea Credit Guarantee Fund (KODIT) for a “Joint Project Guarantee Program,” offering guarantees of up to KRW 2 billion per company. Currently, we have guaranteed KRW 8.6 billion for loans to eight companies.

Emergency Financial Assistance

To support the early recovery of our suppliers’ operations following the prolonged postpandemic downturn, we provided approximately KRW 30 billion in emergency financial aid through unit price adjustments and compensation for business losses in 2020, 2022, and 2024.

Operation of the Collaborative Cooperation Fund

With outsourcing expenditures expected to double by 2030, there is an urgent need to proactively secure the mid- to long-term equipment capacity among our collaborative cooperation partners. However, due to delayed profit recovery following the pandemic, partners have been reluctant to invest. To address both the anticipated capacity shortfall and the need to improve productivity, KAI plans to launch a loan program in 2025, funded with KRW 30 billion from its own budget (operated at KRW 10 billion annually), to provide lowinterest financing for equipment purchases.

Joint Employee Welfare Fund

From 2020 to 2024, KAI, local governments, and SMEs have jointly operated a matching fund program, creating an annual welfare fund of approximately KRW 3.6 billion. This fund has supported over 5,000 employees at 40 partner companies by providing holiday and anniversary gifts, funding for employee clubs and sports events, and improvement in the workplace environment.

Naeil Chaeum Mutual Aid Program

This program, operated in partnership with the Korea SMEs and Startups Agency, aims to support the long-term retention of core personnel at supplier companies. In Phase 1, jointly funded by KAI, its suppliers, and their employees, each participant saved KRW 330,000 per month over five years, resulting in a total of approximately KRW 25 million per person. A total of 29 employees from 10 companies benefited from the program. Starting in 2024, the program expanded into Phase 2, with joint contributions from Gyeongnam Province, KAI, suppliers, and employees. Participants now save KRW 480,000 per month, accumulating approximately KRW 30 million over five years.

Supplier Incentives and Performance Sharing

KAI rewards up to 100 million won to suppliers that achieve excellent performance through regular suppliers evaluations each year, and the rewards are given directly to the suppliers' employees. In addition, KAI operates the "Win-Win Proposal System" for suppliers, which measures the grade of
innovation proposals and provides performance payments according to the grade, and shares excellent improvement tasks with suppliers through the "Innovation Activity Reporting Meeting" to accelerate the establishment of a sustainable and independent innovation culture.

Support for paid leave training

In October 2020, we joined the nation’s first “Region-Specific Emergency Vocational Training Pilot Program,” initiated by the Ministry of Employment and Labor in Gyeongnam. In partnership with Korea Polytechnics (Jinju Campus), we offered paid-leave vocational training for the idle workforce at our partner companies. Over 5,500 employees completed the training program. With support from the Ministry of Employment and Labor, Gyeongnam Province, and local governments, we subsidized approximately KRW 13.2 billion in labor costs and 50% of social insurance premiums, helping our partners retain their workforce during the pandemic.

Workforce Securement Support

Building a Supply Chain ESG Foundation

Global trends, such as the EU Corporate Sustainability Due Diligence Directive and the standardization of global supply chain management (SCM), are intensifying the demand for ESG risk management across the entire supply chain. This is especially critical for KAI’s major customers, including Airbus and Boeing, who now require their suppliers to demonstrate strong ESG compliance. Therefore, KAI launched the Supplier ESG Consulting Pilot Program in 2023, using its Collaborative Cooperation Fund to respond proactively to these evolving demands. The pilot targeted ten suppliers and included ESG training, diagnostic assessments, consulting, and ongoing improvement initiatives. In preparation for the enforcement of the EU directive and to assist suppliers in identifying ESG risk, KAI will participate in the 2025 Climate Disclosure and Supply Chain Due Diligence Foundation Building Project. This initiative is jointly led with the Korea SMEs and Startups Agency (KOSME). To comply with the streamlined evaluation process required for supplier participation in the program, KAI submitted a single letter of intent on behalf of selected partners after conducting a needs survey. As a result, seven suppliers were ultimately chosen for participation.

Preparing for the Aircraft Parts Integration Complex

We are pursuing the 'Establishment of an Integrated Aerospace Parts Production Infrastructure' project to achieve manufacturing innovation and secure global competitiveness through specialized and consolidated aerospace parts manufacturing. Based on the core concepts of integrated production lines, smart factories using digital twin technology, and the shared economy model, we aim to transform unplanned and fragmented production into an efficient, smart manufacturing complex. To bring this vision to life, KAI was selected for a multi-year research project by the Korea Industrial Complex Corporation (KICOX) in both 2023 and 2024. We formed an industry-academia-research consortium that includes KICOX, suppliers, experts, and specialized research institutions to jointly conduct the necessary studies.

Workforce Training (Customized Training Support)

To ensure the sustainable advancement of Korea’s aviation technology and industry, KAI has been operating a Joint Training Center since 2015. The program launched with 57 participating partner companies and has grown to 227 as of 2024. To date, more than 7,000 trainees have completed the center’s training programs. Based on demand surveys, we develop tailored training curricula that meet the specific needs of our partner companies. We provide structured educational support to strengthen their technical competitiveness. Our commitment to workforce development has produced tangible results. In 2022, KAI earned the highest rating in the National Human Resource Development Consortium performance evaluation, a recognition of our leadership in cultivating talent for the aerospace industry.