The F-35 Joint Program Office and Lockheed Martin have finalised an agreement bringing the cost of each variant of the aircraft down by around 13% on average.

This contract includes all U.S., International Partners and Foreign Military Sales aircraft in Lots 12, 13 and 14.

The F-35A unit price, including aircraft and engine, is now below $80 million in both Lot 13 and Lot 14, the F-35A unit cost represents an estimated overall 12.8 percent reduction from Lot 11 costs for the conventional landing variant, and an average of 12.7 percent savings across all three variants from Lot 11 to 14.

“Driving down cost is critical to the success of this program. I am excited that the F-35 Joint Program Office and Lockheed Martin have agreed on this landmark three-lot deal. This agreement achieves an average 12.7 percent cost reduction across all three variants and gets us below $80 million for a USAF F-35A by Lot 13 – one lot earlier than planned,” said Air Force Lt. Gen. Eric Fick, F-35 Program Executive Officer.

“This $34 billion agreement is a truly historic milestone for the F-35 Enterprise.”

According to Lockheed Martin in a release:

“The sub $80 million unit recurring flyaway cost for an F-35 represents an integrated acquisition price for the 5th Generation Weapon System. With embedded sensors and targeting pods, this F-35 unit price includes items that add additional procurement and sustainment costs to legacy 4th Generation aircraft.”

Price details include:

VariantLot 12Lot 13Lot 14% Reduction from Lot 11*
F-35A$82.4M$79.2M$77.9M12.8%
F-35B$108.0M$104.8M$101.3M12.3%
F-35C$103.1M$98.1M$94.4M13.2%
*Please note: Final prices for F-35 variants following adjustments for Congressional plus-ups and other contractual settlements are as follows: F-35A – $89.3M; F-35B – $115.5M; and $108.8M.

“With smart acquisition strategies, strong government-industry partnership and a relentless focus on quality and cost reduction, the F-35 Enterprise has successfully reduced procurement costs of the 5th Generation F-35 to equal or less than 4th Generation legacy aircraft,” said Greg Ulmer, Lockheed Martin, F-35 Program vice president and general manager.

“With the F-35A unit cost now below $80 million in Lot 13, we were able to exceed our long-standing cost reduction commitment one year earlier than planned.”

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Mr Bell
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Mr Bell

Can we now afford a follow on order for at least another 48 more F35Bs? If costs have come down a bit. Desperately need more high performance aircraft for fleet air arm and RAF.

Ian
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Ian

Or 63 A-Variants for the same cost?

Pacman27
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Pacman27

Except it isn’t the same cost as the parts and support is significantly different and will cost a fortune to implement. We should save that for tempest and invest wisely in what will be our typhoon replacement.

Nigel Collins
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Nigel Collins

Equally, it would make sense to sell-off our Tranche 1/2 aircraft and replace these with new Tranche 3’s whilst continuing with the upgrade program until Tempest arrives.

An increase in F-35B’s would be fine for the RN carriers, but does it really make sense to invest heavily in the A variant for the RAF as it first took to the skies fourteen years ago?

Internal fitting of Meteor will not take place until around 2024/5 as it has to be modified to fit.

Steve R
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Steve R

Replacing Tranche 1 or 2 aircraft with Tranch 3 is a good idea. Money made from the sales would offset some of the cost of the new Tranche 3s.

Would help preserve our current numbers of Typhoons, so we dont have to reduce numbers or write off squadrons because we would actually be able to replace the airframes.

This would also keep the production lines open, preserving the jobs and skills required for Tempest later.

Julian1
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Julian1

Can understand the logic behind selling T1 (but only if they are replaced) but not T2. A fortune has just been spent on T2 and Centurion, it would be a total waste of money to sell them.

Trevor
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Trevor

Any order would still wait some time. We are waiting for completion of first 48. Later tranches would presumably be cheaper.
Likewise the Tempest is still a mock up. Should we cancel f35s on the expectation of Tempests replacing them?

Nigel Collins
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Nigel Collins

Increasing the number of F35-B for the carriers would be fine as well as replacing Tranche 1 Typhoons with 3a’s. Committing to the F35-A now when we would not see sufficient numbers of them within the next four to five years would be a mistake I feel. There is still a lot of work to be done in order to get them up to block 4 standards, and that’s if everything goes to plan. “The Government Accountability Office recommended last June that Block 4 be delayed until initial operational testing was complete, but Winter certified that the rapid advance of… Read more »

Trevor
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Trevor

Seems sound. The F35 is a long term project.

I read that the Israelis are proposing to put some computerised layer-thingy over the F35s computer system to work with their own weapons and systems. Perhaps we could do the same…

Rob Collinson
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Rob Collinson

What orders do we have in already? Which Lots? How many do we have now? How many are ‘in build’?

It is very hard to keep track and difficult to find up-to-date info on the WWW.

Pacman27
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Pacman27

We currently have 16 with a further 2 on order with a further 17 within these 3 lots. So by the end of 2022 (lot 14) we will have 35 F35B in total. Lot 15 will be the first full rate production lot and it would be good to see the uk order 8 aircraft pa from this lot until 2030 where we can reduce it to 4 pa until we hit our 138 Target around 2040. This would seem to be the smoothest way to get our numbers up in a consistent manner, but I am not sure what… Read more »

JohnN
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JohnN

Great to see production numbers going up and procurement cost going down. I do have a question for my Pommie cousins. As I understand it, there are currently 48 Bs approved (90 yet to be approved), there are about 18 airframes in service (or will be by the end of this year), so how many Bs will the UK procure over these three production lots? Lots 12-14? Here in Oz all is going well with the RAAFs procurement of F-35A (16 delivered so far, another two due before the end of the year to make 18), and another 45 will… Read more »

Stephen
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Stephen

I think it extremely unlikely that Australian Defence budget will stretch to accommodating 100 F35’s. By the mid to late 2020’s, the commitments to submarines, frigates, patrol boats, Boxer 8×8, APC replacement etc etc, will place enormous strain on the capital budget. Canberra have been basing their budget’s on GDP growth of 3% for several years & well into the forward estimates. When, in real terms, we are barely achieving 1.5%. Increasing demands on other parts of the National budget is huge. I hate to say it, but the Australian defence budget is going to face serious headwinds over the… Read more »

Stephen
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Stephen

And don’t forget that the AU$ has depreciated by more than 30% against the USD in the last 5 years. So despite forward hedging, the value of imported military hardware from the USA is increasing significantly. It has also depreciated against the EURO and, more recently the GBP.
So apart from airframes, the cost of combat systems, missiles, propulsion units, sonar etc are all trending north.
This just supports my concerns.

JohnN
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JohnN

Stephen, There is no doubt that there is always pressure on annual Defence budget allocations, and ‘nominally’ Australian Defence spending is ‘publically’ expressed as a % of GDP (currently approx. 1.9% and next budget year approx. 2%), but that is not strictly the case with the current funding model. When the 2016 Defence White Paper was released back in February 2016, the funding model was ‘de-linked’ from GDP to avoid fluctuations, and actually nominated what Defence spending would be for the following 10 years, year by year, and so far what was planned has been delivered. As for that last… Read more »

Paul T
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Paul T

Stephen – As an outsider I’m guessing that the Attack Submarine programme poses the greatest risk,it’s a massive investment,all three bids contained some problems to overcome but I’m still surprised the Japanese Soryu design wasn’t chosen.

Andrew dyson
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Andrew dyson

Look at a the C version as a pure tornado replacement at the same time as the B to save typhoon airframe life until tempest arrives.

the_marquis
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the_marquis

You mean the “A” version as a Tornado replacement, surely?

Andrew dyson
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Andrew dyson

The C version carries a larger payload and at some time in the future the cost of EMALS may be affordable for one of the carriers.

the_marquis
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the_marquis

Hmm the problem with that is that the C version would not be able to operate from the carriers as it stands, and is also much more expensive than the A version. Given that there is a heated debate about the costs of a split buy of A and B variants to replace the old Tornado and Harrier fleets respectively, I think it would be a tremendous waste of money if we opted for the C version to operate as a land based interdictor on the off-chance we might one day switch to EMALS on the carrier. Right now I… Read more »

Paul T
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Paul T

the_marquis – Ive thought for some time that the ‘C’ version has two advantages over the ‘A’, the first is that it Future-Proofs any decision taken down the line to convert the Carriers to Cat and Trap,but like you id agree this is not likely,in fact I’m sure it wont happen.The second is that as the Airframe is Strengthened for Carrier ops there could be a bonus regards Airframe life and maintenance costs when they are used in a more benign Land role.Looking at the cost reduction chart it seems to have the greatest reduction in savings too as a… Read more »

the_marquis
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the_marquis

The F35 programme is great, fantastic product, and this price drop is brilliant – justifies the whole endeavour, and also justifies the UK MOD’s cautious approach to buying them. However, at the same time it has really screwed the RAF, and has meant we are now unlikely to have much more than 200 fast jets in service at any point over the next 20 odd years. The programme has also right royally screwed the wider international defence industry. McDonnell Douglas was an early victim, but Boeing is also on the ropes and the European manufacturers are going to struggle to… Read more »

the_marquis
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the_marquis

What I mean to say is, future publications of Jane’s “Fighter Planes Today” are going to be pretty thin…

Steve R
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Steve R

200?! Even that sounds optimistic. The RAF have around 150 Typhoons, of which perhaps 80-90 are actually in an operational squadron.

Over the next 10 years it will probably reach 200 as the F35 numbers increase and the other 3 squadrons are established… As long as we dont start reducing Typhoon numbers!

If anything we should buy more Typhoons to replace the older ones to maintain current numbers.

the_marquis
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the_marquis

I was being generous and going by how many aircraft the RAF have on the books, rather than operational numbers! But you’re right, actual aircraft available to deploy would be much less.

The sad thing is I can’t see anyone coming along willing to boost numbers when previous governments have set the precedent that this is now the status quo and “what we can get by on”, even though it is anything but… 😔