Lockheed aims to slash cost of F35 jets

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[A pig of an aircraft at half price would still be a pig of an aircraft. But just watch to see if Harper doesn't jump all over this one. *RON*]

Robert Wright, Financial Times, 18 February 2015

Lockheed Martin is on track to slash 30 per cent from the cost of each F-35 joint strike fighter, bringing the price of the controversial aircraft below that of previous, less capable generations of fighters, Marillyn Hewson, the company’s chief executive, said on Wednesday.

The reduction would bring the cost of each F-35A — the version for the US air force — down to less than $80m from between $110m and $115m each. Such a saving could save billions of dollars in procurement costs for the programme, currently estimated at $396bn for more than 3,000 aircraft for the US and key allies.

A sharp fall in the programme’s costs would vindicate the US defence department’s highly controversial decision to procure a single aircraft for the strike fighter needs of the US air force, marine corps and navy. The programme — by far the biggest single military procurement project in history — came close to cancellation in 2011 amid severe cost and time overruns and questions about whether the aircraft would ever be able to fulfil its multiple different roles.

The Pentagon last year signed a “blueprint for affordability” agreement with Lockheed, under which both the government and Lockheed committed to invest in new cost savings for the programme.

“The goal is to reduce the cost of an F-35A fifth-generation fighter to the equivalent of today’s fourth-generation fighter,” Ms Hewson said of the affordability programme at a media day in Arlington, Virginia. “We’re confident we’ll get there by the end of the decade.”

Ms Hewson said that 80 per cent of the cost reductions would come from economies of scale as the factory making the aircraft in Fort Worth, Texas, moves into full production. The company manufactured only 36 aircraft last year but is due to be producing more than 100 annually — around half of them for international buyers — by the end of this decade.

However, it is also seeking cost savings through introducing new manufacturing methods for critical parts such as the transparent cockpit canopy and the leading wing edges. It has achieved significant savings through reducing the amount of aluminium it buys for some parts.

The US government realises savings by negotiating prices for individual packages of aircraft with Lockheed.

“We have an ongoing dialogue with our customer through every negotiation and we have a good exchange of information,” Ms Hewson said.

Government auditors and other observers have regularly raised doubts that the aircraft might not meet the goals set for it. The aircraft is intended to be far more stealthy than previous generations of fighters, meaning it should be able to attack enemy aircraft before they have even detected its presence. The auditor’s reports have questioned whether the stealth characteristics would work as intended.

Lockheed had to call off a planned inaugural trip to Europe for last year’s Farnborough air show after an engine fire led to a temporary grounding of the whole fleet.

Ms Hewson said the company was “focused on performance” and meeting the targets set for the aircraft.

The most recent auditors’ reports on the aircraft showed that there were “no new issues” with the programme, Ms Hewson insisted.


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