F-35 to get more expensive in next deal, program exec says
A U.S. Air Force F-35A from the 34th Fighter Squadron at Hill Air Force Base lands at Spangdahlem Air Base, Germany, Feb. 16, 2022. (US Air Force/Tech. Sgt. Maeson L. Elleman)
WASHINGTON: Prices for the next batch of Lockheed Martin’s F-35 Joint Strike Fighters will probably be higher than the last, the Pentagon’s F-35 program head said today.
However, it’s premature to say that the cost of the F-35A conventional takeoff and landing variant, which is used by the US Air Force and most international customers, will once against come in above the Pentagon’s cost goal of $80 million a copy, Lt. Gen. Eric Fick told reporters at a roundtable.
“I think it’s likely that we’ll see costs rise on a tail by tail basis. I think it’s early to say where I think that they’ll end up,” Fick said.
For about a year, Lockheed and the Defense Department have been embroiled in negotiations over F-35 Lots 15 through 17, which will roughly include about 400 aircraft for US and international customers.
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The contract for lots 12-14, inked in 2019, included 478 F-35s for the US military and international customers. Under the terms of the agreement, an F-35A will cost $77.9 million in Lot 14, with the F-35B short takeoff and landing variant coming in at $101.3 million and the F-35C carrier variant at $94.4 million during the same period.
Those prices are unlikely to stick.
Lockheed has made clear that rising inflation and the cost of supplies during the COVID-19 pandemic has led to a price hike for materials that is already driving costs up on the jet. During a January earnings call, Lockheed executives also pointed to oncoming Block 4 upgrades and a potentially smaller order as cost drivers.
“It’s proven more difficult than we expected to reach agreement on a cost baseline that incorporates the impacts that we see associated with our customer ordering fewer aircraft in Lots 15-17 than were ordered in the prior buys of 12-14,” John Mollard, Lockheed’s acting chief financial officer, said in January, according to Air Force Magazine.
Negotiations between the government and Lockheed seem to be far from over, with Fick saying today that he is “losing confidence that we’ll get it done by the end of this month, which was our which was our revised target.”
“We’re trying to figure out how we sort through the headwinds and lead through them to find a place that allows us allows us to get the aircraft we need at a cost that we can afford, while still recognizing some of those challenges that Lockheed faces,” Fick said.