Air Warfare, Congress

Boeing backs away from pricetag pledge for upcoming F-15EX production lots

ST. LOUIS — A Boeing executive recently declined to uphold a previous pledge by another company official that the sticker price for F-15EX fighters in the jets’ next two production lots would come in below $80 million.

Prat Kumar, Boeing vice president for F-15 programs, was asked Thursday about the pledge made by a colleague at the Royal International Air Tattoo (RIAT) trade show last year. Kumar denied the pledge extended to production lots 2 and 3, asserting that it only applied to fighters tied to lot 1 deliveries. 

“So let me be clear, the commitment was $80 million for lot 1,” Kumar said. 

But Kumar’s statement is at odds with that of Steve Parker, who is now Boeing’s chief operating officer for the company’s defense, space and security sector. At RIAT in July 2022, Parker discussed the “next two lots of EXs” and told reporters that despite inflationary pressures, the jets would be “less than $80 million,” adding that, “When the contract comes out, you can check the numbers.”

The real numbers aren’t available yet because the contract has not been finalized, though Kumar said there is “a very active discussion” about it. Asked about Air Force budget documents [PDF] that illustrate a price creep for the F-15EX — which the documents say could reach as high as $106 million per unit for orders in fiscal 2025 — Kumar said, “This is a different world than [what] we were envisioning in the 2018-19 timeframe. The pressures in the supply chain are just incredible. So what you see in the budget is a reflection of compounding inflationary pressures post-COVID.”

Pointing to those inflationary pressures, Kumar added, “I can’t imagine anybody would promise that ‘Hey, the price will remain the same in the foreseeable future.’”

Even though Kumar said the under-$80 million pledge more narrowly concerned the jet’s lot 1 order, that goal too was missed, but just barely. According to a report in Inside Defense, the Air Force and Boeing definitized the lot 1 contract at a price point of $80.5 million for each jet, known as its “flyaway” price. 

Kumar acknowledged the target for lot 1 was just off. “It was a commitment for lot 1.” he said. “And we came pretty damn close.”

As of the FY23 budget request, the Air Force planned to cap the buy of the fighters at 80, down from an original plan of 144, but in the FY24 budget request officials indicated they would order an additional 24 fighters in FY25 for a total fleet of 104.

Walking along the fighter’s production line in St. Louis last week, where work is underway on lot 1 and 2 fighters, Kumar pointed to improvements in automation and digital engineering that help the F-15EX’s pieces “snap together like Legos” when they join up during assembly. Using these tools reduces the possibility of defects in manufactured parts, Kumar said, and ensures greater precision for the thousands of tiny pieces that have to be perfectly integrated. (Like other media, Breaking Defense accepted accommodations from Boeing for the visit.)

These new tools can also make new worker training more efficient, Kumar said, and speed up elements of production itself.

“It’s magical engineering,” he said. Pointing to some of these capabilities, he added, “our workforce couldn’t really believe it could really do that. When it really happened, they became believers.”