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New spending report also shows steady cost drop for all variants of the F-35.

On 24 March 2016, the annual Selected Acquisition Reports (SAR) for 2015 was released. This report provides status on programme cost, schedule, and performance as of December 2015.

It has been revealed that the Pentagon’s estimate for the total acquisition cost of the F-35 program is $379 billion, down from $391 billion projected in 2014.

According to a statement from the F-35’s project office:

“The overall Acquisition Cost (RDT&E, Procurement, and MILCON) of the program decreased by $7B in base year 2012 dollars (BY12$) and $12.1B in then-year dollars (TY$). The increase of $16B (BY12) and $95.2 (TY$) to Total Program Cost is the net impact resulting from a transfer of $300M to RDT&E, a $7.5B decrease in Procurement, an approximately $200M increase in MILCON, and a $23B increase in O&S.

The RDT&E increase is the result of a transfer of money from the Procurement account to the RDT&E account to fund the modification of 24 Operational Test aircraft for Initial Operational Test and Evaluation, in accordance with Service guidance.

This transfer out of Procurement into RDT&E had zero net effect on Total Program Cost.”

According to F-35 Joint Program Office chief Lt. Gen Christopher Bogdan:

“We are coming down the learning curve and the price curve a little steeper. We are coming down the price curve faster than we anticipated years ago.”

The average unit cost of the aircraft decreased by:

$1.8M for the F-35A
$0.7M for the F-35B
$1.0M for the F-35C

Jeff Babione, Lockheed Martin’s programme manager for the F-35, told reporters that the cost of the F-35A will drop to about $85 million by 2019. This is understood to be thanks to efficiencies and cost-cutting manufacturing technologies. The B and C variants are also steadily reducing in cost.

By contrast, the US Navy’s F/A-18 Super Hornet aircraft cost about $60 million apiece.

Looking back at last years SAR, the average cost-per-unit for the aircraft for low-rate initial production lots six, seven and eight had also fallen as shown below, the figures also include engines and adjust for inflation and show the continued drop in price.

F-35A conventional takeoff and landing model: $117 million, $112 million, $108 million
F-35B “jump-jet” model: $145 million, $137 million, $134 million
F-35C carrier variant: $134 million, $130 million, $129 million

Back to the current SAR, the estimate of annual operating cost decreased by an average of two percent and the estimated steady state cost per flying hour decreased by:

2.2 percent for the F-35A,
3.3 percent for the F-35B,
4.2 percent for the F-35C

These reductions were reportedly the result of improved maintainability and sustainability as the aircraft matures, the design stabilises, and maintenance of the aircraft becomes more efficient and effective.

F-35 unit costs have been going down with each successive lot of aircraft and will continue to. The bottom line is that overall programme costs have gone down and continue to massively decrease annually.

17 COMMENTS

  1. Perhaps those commenters at this site who complain about the UK not ordering F35s earlier, will now see the benefit of waiting till we are ready for them?

    • The issue is we are waiting to the absolute last minute and even then we are only buying a handful.

      Anything goes wrong with the order, the integration with uk weapons etc, and we have a carrier without jets and look like a laughing stock again on the world scene.

      Ok we save a little by waiting, but it would have been more sensible to have the minimum we required to have an effective carrier strike group, a year or so before the carriers.

      It’s not like the time would be wasted, there is plenty of training that can be done with them in the gap and they could even be deployed if needed.

      • The RAF already have 4 on hand and have done for years, they are based in the US to ensure that A) We aid in its development. B) Train our pilots ready and C) To ensure our weapons are fully integrated into the F35B before they become carrier operational.

        By waiting we are ensuring the best possible deal and who knows, this could lead to a further procurement in other areas of our armed forces where we lack advantages over our rivals.

        Remember also, that our as part of out 2% Defence budget ring fencing deal, we also make savings where possible in order to minimise the possibility that that 2% budget simply isn’t just funding project overrun costs for our current projection of equipment procurement.

        • Whilst you might be right, I can’t help thinking it has more to do with politicians wanting to keep orders for when they need votes / opinion.

          I can’t for example understand why the order for the P8’s hasn’t been placed, now that we have announced who we are going to buy from and the numbers, I can’t see that we are expecting our negotiation position to suddenly improve.

          • Well the P-8 issue is not one im entirely familiar on, although i believe the RAF are looking to lease a couple ASAP to fill the requirement gap, possibly within the next few years. But this could be a ‘lease to buy’ deal similar to the C17A initial procurement. Again, im not sure anybody other than a select few in the entire country know the ins and outs of the procurement of the P-8’s at the minute.

            In my opinion the defence of this country doesn’t hold as much sway with the public it once did in winning votes. I doubt the majority of the population know what maritime patrol aircraft are and what we are protecting our land from, let alone what a P-8 Poseidon is. Votes are more likely lost than won, particularly with Tridents replacement. Perhaps im being too cynical. But of course you could be right in some regard.

          • I think your right that the majority of the public don’t care, but the government is in a difficult position with the SNP and they seem to care deeply about defence assets / expenditure being in Scotland, which the p-8’s will no doubt be based.

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