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Another stock is reeling into the red after a tweet by President-elect Donald Trump.
This time around, Trump turned his gaze to Lockheed Martin’s F-35 program in a tweet early Monday morning.
“The F-35 program and cost is out of control,” Trump tweeted. “Billions of dollars can and will be saved on military (and other) purchases after January 20th.”
The next-generation fighter jet has overrun costs – overshooting the original budget by 50% – but is near completion. In total, the military has spent roughly $1.5 trillion on the development of the F-35.
Following the tweet, Lockheed Martin’s fell by 5% as of 12:45 a.m. ET. Based on the number of shares outstanding, the tweet has shaved just over $3.8 billion from Lockheed’s market cap.
In response to the tweet, Lockheed Martin Executive Vice President and General Manager Jeff Babione said the company welcomes “the opportunity to address any questions the president-elect has about the program” during a speech in Israel.
The tweet came just one week after Trump took aim at Boeing over costs for the replacement Air Force One. Boeing stock fell by 1.5% after the tweet but ended the trading day positive.
After the Boeing tweet, Trump argued that part of his role as president would be to “negotiate” prices.
Here’s the full statement from Babione, provided by Lockheed Martin:
“This is a great day for the Israeli people. It’s exciting to bring this airplane and its capabilities to the country.
We welcome the opportunity to address any questions the president-elect has about the program. It’s a great program. Lockheed Martin and its industry partners understand the importance of affordability for the F-35 program.
Since the beginning, we’ve invested hundreds of millions of dollars to reduce the price of the airplane more than 70% from the original LRIP [Note: Lockheed later clarified to Business Insider that this figure should be 60%]. We project the price of the aircraft will be $85 million in the 2019 -2020 timeframe. When we get to $85 million, the F-35 will be less expensive than any fourth-generation fighter in the world. And it will be the premiere fifth-generation fighter. That’s an incredible value for anyone operating the airplane.
We understand it’s not just the acquisition price. Lockheed Martin and its industry partners are also investing in reducing the sustainment costs of the aircraft recognizing that much of the cost of owning and operating an aircraft is after it’s delivered. We plan to invest hundreds of millions of dollars in an effort to reduce the cost of sustaining the airplane over its 30-40 year lifespan. We understand the importance of affordability and that’s what the F-35 has been about.
But more importantly, it’s the amazing technology. For the air forces that get this airplane, it’s not an evolution in technology, it’s a step function in capability. Whoever has it will have the most advanced air force in the world, and that’s why we’re building the F-35. That’s why it’s important that the U.S. and our partners, like the Israeli Air Force, have this aircraft. It’s a great value and we look forward to any questions the president-elect may have.”