Lockheed Martin, Pentagon announce F-35 deal that shaves $728M in costs
The Pentagon and Lockheed Martin announced on Friday a contract deal for the next batch of 90 F-35 Joint Strike Fighter jets that shaves $728 million off the total cost of the program and brings the per plane cost of the stealth plane below $95 million for the first time.
The contract is “a good and fair deal for the taxpayers, the U.S. Government, allies, and Industry,” F-35 Program Executive Officer Lt. Gen. Chris Bogdan said in a statement. “We continue to work with Industry to drive costs out of the program.”
The announcement brings an end to months of unusually public negotiations between the Trump administration and Lockheed Martin, which manufactures the plane.
In late December, the president took to Twitter to criticize the program for being too expensive. He even went so far as to ask one of Lockheed’s competitors, Boeing, to “price out a comparable F-18 Super Hornet,” as an alternative to the F-35. The Pentagon subsequently said the F-18 would be considered as an alternative to the F-35C, a more expensive variant that accounts for a very small portion of the overall program.
On Monday, Trump took credit for squeezing costs out the program, which he estimated at the time would be about $600 million.
“President Trump’s personal involvement in the F-35 program accelerated the negotiations and sharpened our focus on driving down the price,” Lockheed Martin spokesman Bill Phelps said in a statement Thursday. “The agreement was reached in a matter of weeks and represents significant savings over previous contracts.”
The unit cost of the plane has been on a long downward trend as Lockheed ramps up its volume of production. The company has been saying for years that it expects the cost of the plane to fall to $85 million per plane over the next few years, and the Air Force’s budget for 2017 already reflects cost reductions of about $10 million per plane.
FILE – In this July 7, 2006, file photo, the Lockheed Martin F-35 Joint Strike Fighter is shown after it was unveiled in a ceremony in Fort Worth, Texas. Shares of Lockheed Martin fell Monday, Dec. 12, 2016, as President-elect Donald Trump tweeted that making F-35 fighter planes is too costly and that he will cut “billions” in costs for military purchases. (AP Photo/LM Otero, File)
FILE – In this July 7, 2006, file photo, the Lockheed Martin F-35 Joint Strike Fighter is shown after it was unveiled in a ceremony in Fort Worth, Texas. Shares of Lockheed Martin fell Monday, Dec. 12, 2016, as President-elect Donald Trump tweeted that making F-35 fighter planes is too costly and that he will cut “billions” in costs for military purchases. (AP Photo/LM Otero, File)