Pentagon reaches three lot deal, taking cost of each F-35A aircraft at historic low cost of below $80 million

The F-35 Joint Program Office and Lockheed Martin has finalised a $34 billion agreement for the production and delivery of 478 F-35s at the lowest aircraft price during the history of the programme. The contract includes all US International Partners and Foreign Military Sales aircraft in the next productions lots 12, 13 and 14.

The deal will bring the unit cost of an F35A aircraft down from $82.4m in Lot 12 to $77.9m in Lot 14 – a decrease of 12.8 per cent on the unit cost from Lot 11 costs for the conventional landing variant, and an average of 12.7 percent savings across all three variants – F35A, F35B and F35C – from Lot 11 to 14.

Reduction “critical” to programme success

Air Force Lt Gen Eric Fick, F-35 Program Executive Officer said: “This $34 billion agreement is a truly historic milestone for the F-35 Enterprise. 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 percent 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.”

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

Costs less than 4th Generation legacy aircraft

Greg Ulmer, Lockheed Martin, F-35 Program vice president and general manager said: “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. 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 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.

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.

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