CASELLE, Italy -- The Italian government and Alenia Aeronautica are in negotiations on how to finance the domestic F-35 final assembly and checkout (FACO) facility in light of fiscal belt-tightening brought on by the global recession.

Details must be finalized by January to maintain the schedule of delivering the first F-35 assembled at the Cameri Air Base, Italy, facility by 2014, says Giovanni Bertolone, chief executive officer of Alenia Aeronautica. The facility is to be government owned but contractor operated.

The FACO was estimated to be worth $792 million when the parliament approved the proposal. But the "scale" and work "scope" are in the trade space for the discussions, Bertolone said Sept. 22 during a roundtable at the company’s C-27J assembly plant here near Turin.

Shifts in the approach could include opting against a more sophisticated moving assembly line, which would replicate the main final assembly plant at Lockheed Martin’s Fort Worth, Texas, facility. It also could mean fewer workstations or the purchase of fewer sophisticated tooling sets, which could slow the pace of deliveries. If more sophisticated tooling is purchased, the question is who will pay the bill.

Italy and the Netherlands are planning to accept F-35s from the FACO at Cameri.

"We are discussing a certain level of investment and we want to maintain this level of investment," Bertolone says. "Presently, the technical aspects and requirements for the FACO are quite well set up. The problem is the affordability and the way in which we can do this at an acceptable level of investment." Bertolone declined to provide a specific amount of investment planned by Alenia, but it is in the "hundreds of millions of dollars," he said.

"It is also because there is such a big investment in the front to be paid, that it requires a complex solution," he added.

Italy is slated to buy 131 F-35s in both the conventional-takeoff-and-landing (CTOL) and short-takeoff-and-landing versions. The Netherlands is planning to buy about 85 CTOL aircraft.

Bertolone says the "next few months will be crucial," as the negotiations come to a close.

Underlying the discussion is the question of value for the Italian industry, given economic pressures that could prompt the purchase of fewer aircraft or trim back the configuration of the FACO facility. Alenia officials say this FACO is a critical element of the company’s plans to continue manufacturing and maintenance activities in high-technology areas.

Photo: DoD