- Lockheed Martin
WASHINGTON – In response to a series of cost overruns and other development issues for the F-35 fighter jet, President-elect Donald Trump said on Thursday he has asked Boeing to “price-out a comparable F-18 Super Hornet.”
Trump’s request – announced via tweet – came a day after meeting separately with the CEOs from Lockheed Martin and Boeing to discuss bringing the “costs down” on the F-35 fifth-generation stealth jet and the next fleet of presidential aircraft.
Boeing’s response – also announced via tweet – said it accepted the invitation to work with the Trump administration to “affordably meet US military requirements.”
On December 12, Trump said the cost for Lockheed Martin’s fifth-generation stealth F-35 Lightning II jet was “out of control.” The message sent Lockheed Martin’s stock down from $251 at the opening bell to $245.50, before it rebounded to a little more than $253 a share. Similarly on Thursday, shares of Lockheed Martin fell 2.0% to $247.75 after hours, while Boeing shares rose 0.7% to $158.52.
- Carlos Barria/Reuters
“We’re trying to get costs down … primarily the F-35, we’re trying to get the cost down. It’s a program that is very, very expensive,” Trump said on Wednesday after meeting with Lockheed Martin CEO Marillyn Hewson. Trump said the negotiations with Lockheed Martin were “just beginning” and described it as “a little bit of a dance.”
“I appreciated the opportunity to discuss the importance of the F-35 program and the progress we’ve made in bringing the costs down,” Hewson said in a statement. “The F-35 is a critical program to our national security, and I conveyed our continued commitment to delivering an affordable aircraft to our US military and our allies.”
Lockheed Martin’s F-35 Lightning II, valued at an acquisition cost of $379 billion, has become one of the most challenged programs in the history of the Department of Defense. It has experienced setbacks that include faulty ejection seats, software delays, and helmet-display issues.
- US Air Force Photo
“The problems on this program quite frankly in the past were very simple. We were overly optimistic in the technical risk in building this leading edge fighter and so we put unrealistic schedules and budgets together and then when we ran into problems we did not manage them very well,” Lt. Gen. Chris Bogdan, head of the F-35 Joint Program Office,said during a briefing with reporterson Monday.
“I think that this program is vital for air dominance for us and our allies for the next 5o years. It replaces many, many, many legacy fleets, it has tremendous international participation and involvement, and it is a necessary program for the United States to maintain its security,” Bogdan added.
The suggested Boeing F/A-18E/F Super Hornet is a generation behind the F-35, lacking the coveted capabilities such as stealth and sensor fusion.
In short, Boeing’s Super Hornet would need to be significantly redesigned, manufactured, and tested over multiple years in order to meet the same requirements as the F-35.
A little bit of background on America’s fifth-generation jet
- Courtesy of Lockheed Martin
Manufactured by Lockheed Martin in Fort Worth, Texas, the fifth-generation “jack of all trades” aircraft was developed in 2001 to replace the aging Air Force, Marine Corps, and Navy fleet.
Designed to accommodate the unique needs of each sister-service branch, the F-35 comes in three variants: the F-35A for the Air Force, F-35B for the amphibious Marine Corps, and F-35C for the Navy.
All of the fighters are equipped with radar-evading stealth, supersonic speed, and “the most powerful and comprehensive integrated sensor package of any fighter aircraft in history,” Jeff Babione, the head of Lockheed Martin’s F-35 program, said in a statement.
“I have stealth,” US Air Force Maj. Will “D-Rail” Andreotta, commander of the F-35A Lightning II Heritage Flight Team and F-35 pilot, told Business Insider in a recent interview.
“I’ve fought against F-16s and I’ve never gotten into a dogfight yet. You can’t fight what you can’t see, and if F-16s can’t see me then I’m never going to get into a dogfight with them.”
In other words, the F-35 gives pilots the ability to see but not be seen.
- Courtesy of Lockheed Martin
What’s more, unlike any other fielded fighter jet, the F-35 can share what it sees in the battle space with counterparts, which creates a “family of systems.”
“Fifth-generation technology, it’s no longer about a platform. It’s about a family of systems, and it’s about a network, and that’s what gives us an asymmetric advantage,” Gen. David Goldfein, the Air Force chief of staff, said during a Pentagon briefing.
“In terms of lethality and survivability, the aircraft is absolutely head and shoulders above our legacy fleet of fighters currently fielded,” said Pleus, an F-35A pilot and former command pilot with more than 2,300 flying hours.
Now for the price tag …
- Matt Cardy/Getty Images
The US is slated to buy 2,443 F-35s at an acquisition cost of $379 billion.
Earlier this week, the F-35 Joint Program Office released the finalized price for the most recent production contract for the fifth-generation jet.
After a little more than 14 months of negotiations between the Department of Defense and Lockheed Martin, the ninth Low Rate Initial Production (LRIP-9) contract for 57 F-35 jets was valued at $6.1 billion.
The LRIP-9, which is essentially the ninth batch of jets, includes 34 jets for the US and 23 for five international countries.
The following is a breakdown of the unit price per variant in current year dollars (including aircraft, engine, and fee):
42 F-35A model aircraft: $102.1 million a jet 13 F-35B model aircraft: $131.6 million a jet 2 F-35C model aircraft: $132.2 million a jet
By comparison, in the previous contract, LRIP-8, the government paid $108 million for the Air Force’s F-35A, $134 million for the Marine Corps’ F-35B, and $129 million for the Navy’s F-35C.
While the price for the Air Force and Marine Corps’ variants saw a reduction of $5.9 million and $2.4 million respectively, the Navy model saw an increase of $3.2 million.
“Why did that happen?” said Bogdan, head of the F-35 Joint Program Office, during a briefing with reporters. “That happened because in lot nine the Navy bought two C models and in lot 8 the Navy bought four models.”
“So they cut their production in half and as a result of that when you do an economies of scale in one direction it hurts you in the other direction. Having said that, I fully anticipate that when we do settle LRIP 10 you’ll see all three variants, the A, the B, and the C come down in price significantly,” Bogdan said.
And by “significantly” Bogdan added that he believes “somewhere on the order of 6 to 7 percent per airplane, per variant.”
Meanwhile, the 57 aircraft in LRIP-9 are in various stages of production at Lockheed Martin’s facility in Fort Worth, Texas. Deliveries for these aircraft are slated to begin in the first quarter of 2017.