The price of a single Lockheed Martin F-35 Lightning II is set to fall, Lockheed Martin CEO Marillyn Hewson said last week. She announced the cost reduction as part of pending deal with deal with US president-elect Donald Trump. The deal should also see the creation of thousands of extra US jobs. It puts a a lot of extra pressure on the F-35 program.
According to Hewson, the price of the next 90 aircraft will reduce significantly under the deal. The question remains by how much the F-35’s unit price will fall and how this relates to a price reduction announced earlier. Currently, the price is 98 million USD for a single ‘vanilla’ F-35A, but that price was already set to drop to 85 million USD by 2020, as result of ‘numerous affordability measures to drive costs out of the program.’ Both the F-35B and F-35C versions remain more expensive than the F-35A.
— Lockheed Martin (@LockheedMartin) 13 januari 2017
The reduction mentioned by Hewson most likely concerns aircraft in Low Rate Initial Producion (LRIP) lot 10, which is currently being negotiated and includes 94 jets for the US plus other nations . A deal on LRIP-9 was only signed last November, involving 57 aircraft worth 6.1 billion USD. The cost of LRIP-9 was the subject of many months of hassle and talks between Lockheed Martin and the Pentagon.
It most likely these drawn out negotiations that sparked Trump’s criticism. Meetings with several top Pentagon and F-35 program officials did little to impress Trump. On the contrary, it probably only incented him in his determination to drive down costs. As we wrote earlier, he may actually do the US a favour by doing so.
Air Force One
It’s the second time Trump appears to have pressured a large aircraft manufacturer in lowering costs, the first of course being Boeing. After Trump’s threat to cancel the contract for a new Air Force One, Boeing was quick to say that it will keep costs below 4 billion USD.
But Trump’s victories so far only exists on paper. Wether Lockheed Martin and Boeing indeed succeed in keeping down costs, remains to be seen. It will be interesting to see also how they do it. And it will also be interesting to see Trump’s response if they fail – not to mention the response of F-35 customers. They already knew the unit price was set to fall, but now they’re counting on even lower prices.
It puts a of pressure on a weapons program that is anything but pressure-free.
© 2017 Airheadsfly.com editor Elmer van Hest