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The F-35 Joint Program Office (JPO) and Lockheed Martin have finalised a $34 billion (€30.5 billion) agreement for the production and delivery of 478 F-35s at the lowest aircraft price during the history of the programme, the company announced on 29 October. This contract includes all US, International Partners and Foreign Military Sales aircraft in Lots 12, 13 and 14.

In the agreement, the F-35 Enterprise meets and exceeds its long-stated cost reduction targets for each variant – and the F-35A unit price, including aircraft and engine, is now below $80 million in both Lots 13 and 14; the F-35A unit cost represents an estimated overall 12.8% reduction from Lot 11 costs and an average of 12.7% across all three variants from Lot 11 to 14.

Driving down cost is critical to the success of this programme. I am excited that the F-35 Joint Program Office and Lockheed Martin have agreed on this landmark three-lot deal. This agreement achieves an average 12.7% cost reduction across all three variants and gets us below $80 million for a USAF F-35A by Lot 13 - one lot earlier than planned,” stated F-35 Program Executive Officer, Lt-Gen Eric Fick. “This $34 billion agreement is a truly historic milestone for the F-35 Enterprise.”

The agreement includes 291 aircraft for the US, 127 for F-35 International Partners and 60 for F-35 Foreign Military Sales customers. Price details include:

Variant

Lot 12

Lot 13

Lot 14

% Reduction
from Lot 11*

F-35A

$82.4M

$79.2M

$77.9M

12.8%

F-35B

$108.0M

$104.8M

$101.3M

12.3%

F-35C

$103.1M

$98.1M

$94.4M

13.2%

*Please note: Final prices for F-35 variants following adjustments for
Congressional plus-ups and other contractual settlements are as
follows: F-35A - $89.3M; F-35B - $115.5M; and F-35C - $108.8M. 


With smart acquisition strategies, strong government-industry partnership and a relentless focus on quality and cost reduction, the F-35 Enterprise has successfully reduced procurement costs of the 5th-generation F-35 to equal or less than 4th-generation legacy aircraft,” commented Greg Ulmer, F-35 Programme Vice President and General Manager at Lockheed Martin. “With the F-35A unit cost now below $80 million in Lot 13, we were able to exceed our long-standing cost reduction commitment one year earlier than planned.”

The sub-$80 million unit recurring flyaway cost for an F-35 represents an integrated acquisition price for the 5th-generation weapon system. With embedded sensors and targeting pods, this F-35 unit price includes items that add additional procurement and sustainment costs to legacy 4th-generation aircraft.

Programme Progress
With more than 450 aircraft operating from 19 bases around the globe, the F-35 is playing a critical role in today's global security environment. More than 910 pilots and 8,350 maintainers have been trained and the F-35 fleet has surpassed more than 220,000 cumulative flight hours. Eight nations have F-35s operating from a base on their home soil and seven services have declared Initial Operating Capability.

In addition to strengthening global security and partnerships, the F-35 provides economic stability to the US and International Partners by creating jobs, commerce and security and contributing to the global trade balance. The F-35 is built by thousands of men and women in America and around the world. With more than 1,400 suppliers in 46 states and Puerto Rico, the F-35 programme supports more than 220,000 direct and indirect jobs in the US alone. It also includes more than 100 international suppliers, creating or sustaining thousands of jobs.

The price reduction programme brings the aircraft into direct competition pricewise with legacy 4th-generation aircraft. (Graphic: Lockheed Martin)

- Mönch Publications - Latest Issues -

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