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DoD mulls shuffling F-35 production sequences

The Pentagon may reshuffle the way it builds F-35 Lightning IIs if it determines that different production orders or schedules can yield a better deal for the over-budget fighters, a senior DoD official said Wednesday. Shay Assad, the director of defense pricing in the Office of the Secretary of Defense, said adjusting the production order for the different types of F-35s was one option under consideration as the department negotiates its forthcoming orders with Lockheed Martin.

John Tirpak of Air Force Magazine began by asking Assad about the program's initial assumption that Lockheed would set up its fighter factory in such a way that it could build F-35s in any sequence. So if an order came in for a mixed batch of Air Force A-models, Marine Corps B-models and Navy C-models, the plant outside Fort Worth, Texas, could build them in any order -- some Cs, some As, then Bs, or whatever -- because of the similarity of the jets. But is it time, Tirpak asked, to reconsider that approach, and see if it might be cheaper to build them in larger, same-model batches?

"That is precisely one of the things we're examining," Assad said, although he would not go into detail about that or other aspects of the discussions with Lockheed. It wasn't clear whether shifted production order might play a role in the negotiations for the next batch of F-35s that DoD wants to buy around the end of this year. Whatever happens, Assad said, he expects the price of the jets to come down.

Another way DoD wants to try to get a better price is with its renewed focus on subcontractors. "We're following the money," Assaid said. Much of the cost for an F-35 ends up in the hands of Lockheed's own vendors, which include many boldface names, including Northrop Grumman and BAE Systems, as well some 900 other suppliers, according to Lockheed. If acquisitions officers can do their magic at every level of production, driving down costs, the net result could be a cheaper airplane, officials hope.

Lockheed, for its part, has said that the key to cheaper airplanes will be building more of them, so it can get its facilities going at a better clip and become more efficient.


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