The Pentagon and Lockheed Martin have reached an agreement for the next two F-35 Lightning II aircraft production contracts, called Low-Rate Initial Production, or LRIP lots 6 and 7, according to an F-35 Joint Program Office statement.
The deal is is expected to include 71 JSF stealth fighter aircraft and continue a reduction in F-35 aircraft pricing. The contracting effort spanned six months from proposal to settlement, the statement indicated.
“The JSF brings very low observable stealth capability combined with advanced fighter capability. We’ve never had that before – fighter performance like this in a stealth aircraft,” said Dick Cathers, deputy capture lead, F-35 Korea, Lockheed Martin.
A decrease in F-35 LRIP 6-7 unit costs, coupled with negotiating lower prices on a number of other smaller contracts, will allow the department to purchase all the aircraft originally planned, including those that were in jeopardy of being cut due to sequestration budget impacts, the JPO statement said.
Cost details will be released once both contracts are finalized; however, in general, the unit prices for all three variants of the U.S. air vehicles in LRIP-6 are roughly four percent lower than the previous contract.
While there is some variation, the estimated cost for individual F-35A conventional take-off and landing (CTOL) aircraft purchased in 2018 and delivered in 2020 will be about $85 million in inflation adjusted “then year” dollars, said Joe Dellavedova, JSF Joint Program Office spokesman.
“This is equivalent to about $75 million in 2012 dollars. That price includes the airframe, engine, mission systems, profit and concurrency,” he said.
LRIP-7 air vehicle unit prices will show an additional four percent reduction. The LRIP-7 price represents about an eight percent reduction from the LRIP-5 contract signed in December 2012.
"These two contracts represent a fair deal that is beneficial to the government and Lockheed Martin," Lt. Gen. Chris Bogdan, F-35 Program Executive Officer, said in a written statement. "Improving affordability is critical to the success of this program, and by working together we were able to negotiate a lower cost F-35."
The new contracts will also include the first F-35s for Australia, Italy, Norway, and the fourth F-35 for the United Kingdom, the JPO statement said.
In addition to procuring the air vehicles, these contracts also fund manufacturing-support equipment and ancillary mission equipment.
Deliveries of 36 U.S. and partner nation aircraft in LRIP-6 will begin by mid-2014 and deliveries of 35 U.S. and partner nation aircraft in LRIP-7 will begin by mid-2015.
“At the start of these negotiations, the F-35 Joint Program Office and our F-35 team jointly committed to conduct LRIP-6 and -7 negotiations in an efficient manner that leveraged all we achieved from the LRIP-5 contract,” Lorraine Martin, Lockheed Martin F-35 Vice President and General Manager, said in a written statement. “Today’s agreement reflects our collective JPO/Lockheed Martin delivery on that commitment. We know how critical aircraft production is to meeting our services’ Initial Operational Capability dates, beginning with the Marine Corps in 2015, and we’re committed to making that happen.”