Thursday, August 4, 2011

First F-35 delivered for training as cost questions linger












The first production model of the Lockheed Martin F-35 Lightning II fighter jet was delivered to the Eglin Air Force base in Florida this week.
According to Lockheed Martin, the plane is a conventional takeoff and landing (CTOL) variant, of which Canada committed to purchasing 65. The plane has been dubbed AF-9 and it is the first plane to be delivered from the second low-rate initial production (LRIP) lot, and the seventh F-35 delivered to the Air Force.
“We’re incredibly proud of our government/industry team whose steadfast dedication to this program led to the successful delivery of the AF-9,” Larry Lawson, executive vice-president of Lockheed Martin said in a press release.
That dedication to the F-35 program has been in question recently. Arizona Senator John McCain has been especially critical lately of the cost overruns of approximately $1 billion announced by Lockheed last week. Joe Dellavdova, a spokesman for the Joint Strike Fighter program office is quoted by Aviation Week as putting the cost overrun at $918 million.
From Aviation Week:
The U.S. intends to pay for $635 million — or 70 per cent — of the projected overage while Lockheed Martin and engine maker Pratt & Whitney, the F-35 lead contractors, will pay for the remaining $283 million by “reducing their target fee,” Dellavedova says. … Including the so-called “concurrency modifications” ($136 million), the total overage for those aircraft on Lots 1-3 is $1.05 billion.
Vice Admiral David Venlet gave a similar number to Bloomberg news. Venlet told Bloomberg in April that “in the worst-case scenario, the three initial production contracts were projected to exceed target costs by 11 to 15 per cent, or by as much as $964 million.”
The next LRIP group (4) will be produced under a fixed-price contract between Lockheed and the Pentagon. Both will equally share any cost overruns, up to 120 per cent of the target price. After that point, it will be up to Lockheed to cover overages.
Meanwhile, CNN-IBN is speculating that U.S. Secretary of State Hillary Clinton will push for the country to purchase the F-35 on her upcoming trip to India. At the moment, the Indian government has eliminated the F-35 from competition.
Two jets remain in India’s multi-role combat aircraft competition (MMRCA) — the French-made Rafale and the Eurofighter Typhoon. As CNN-IBN points out, both of those planes are more expensive than the $65 million per-unit price quoted by Lockheed.
South Korea is also looking to purchase new jets, and according to the Korean Times, Russia has decided to enter the acquisition competition.
According to the report, Russian manufacturer Sukhoi plans to put forth its T-50 PAK-FA as an alternative choice to the F-35, the Boeing F-15SE, and the Typhoon.
From the Times:
[Defense Acquisition Program Administrator] spokesman Son Hyeong-yeong announced that his agency has eased the criteria to allow more companies to bid for the FX-III project, under which Korea will purchase 60 high-end fighters with a budget of 8.29 trillion won ($7.86 billion).
That would make it the country’s largest ever arms procurement. The winning bid will be announced in October of 2012.
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