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Pentagon: Latest F-35 Deal Shaves Unit Cost by 4%

The U.S. Defense Department has struck a deal with Lockheed Martin Corp. to buy another batch of F-35 stealth fighter jets, an agreement they say will reduce the aircraft's unit cost by almost 4 percent.

The world's largest defense contractor on Oct. 27 issued a press release announcing the deal, which calls for the Pentagon to buy 43 Lightning II aircraft as part of low-rate initial production, or LRIP, lot eight.

No dollar amounts were specified -- those are expected to be released once the contract is finalized in coming weeks -- but the release states that "the average unit price for all three variants of the airframe in LRIP 8 is approximately 3.6 percent lower than the previous contract."

Under the previous production contract, the Pentagon in 2013 agreed to pay $112 million per F-35A, the Air Force's version designed for conventional runways; $139 million per F-35B, the Marine Corps' jump-set variant; and $130 million per F-35C; the Navy's version designed for aircraft carriers.

A 3.6-percent reduction would reduce the figures to about $108 million per F-35A, $134 million per F-35B and $125 million per F-35C.

The price tags, known as unit recurring flyaway costs in acquisition parlance, include the airframe, engine, mission systems, profit and concurrency. They don't include certain other expenses, including those for research and development.

The Joint Strike Fighter is the Pentagon's most expensive weapons acquisition program, estimated to cost a total of $398.6 billion for a total of 2,457 aircraft. That breaks down to an overall per-plane cost of $162 million, including research and development. The Pentagon has about 100 F-35s in the fleet so far.

The latest production contract will buy 29 F-35s for the U.S. -- including 19 F-35As, six F-35Bs and four F-35Cs -- the first two F-35As for Israel, the first four F-35As for Japan, along with two F-35As for Norway, two F-35As for Italy and four F-35Bs for the United Kingdom, according to the release.

Air Force Lt. Gen. Christopher Bogdan, who manages the acquisition effort for the government, plans to meet with reporters Oct. 30 to discuss the contract and other program issues. Last month, he said he hopes to have a fix in place for a defective engine part by the end of the year.

Bogdan also said he expects the Marine Corps will begin operational flights of the F-35B jump-jet variant next July as scheduled, followed by the Air Force in 2016 and the Navy in 2018.

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