The Pentagon has recently signed an $11.8 billion “indefinite” contract with Lockheed Martin for the production of 145 F-35 Lightning II fighter jets as part of Lot 18, with delivery expected by June 2027. The agreement follows Lockheed Martin’s decision to fund the F-35 production line independently. The “indefinite” nature of the contract indicates that its details and terms will be finalized at a later date, likely in early 2025.
The indefinite contract will allow Lockheed Martin to receive funding and continue production while details such as the cost and number of aircraft are finalized. However, the Department of Defense has stated that regardless of the outcome of the negotiations, the total value of the contract cannot exceed $11 billion.
The 145 aircraft will include:
- 48 F-35A aircraft for the Air Force
- 16 F-35B and 5 F-35C aircraft for the Marine Corps
- 14 F-35C aircraft for the Navy
- 15 F-35As and one F-35B for non-DOD program partners
- 39 F-35A and 7 F-35B aircraft under the Foreign Military Sales (FMS) program.
On November 21, Romania signed a letter of agreement to purchase 32 F-35A Lightning II aircraft under the FMS agreement, worth $7.2 billion, bringing the number of countries operating the aircraft to 20. Shortly before, Greece announced the purchase of 20 F-35 fighters. However, it is still unclear whether these aircraft are included in the Lot 18 contract.
In a press statement, Lockheed Martin announced that it is experiencing losses for Lots 18 and 19, as “costs have started to exceed the value of the advance contract for the purchase in Q3 2024.” As a result, the company has been unable to realize “revenue and profit from approximately $400 million in expenses.” However, the company expects to “recover billing for incurred costs, as well as restore sales, profit, and cash flow in Q4 2024.”
Representatives from Lockheed Martin and the Pentagon have been in negotiations over the Lot 18 and 19 agreement since 2023 but were unable to reach an agreement on inflation issues. The program has been grappling with inflation, cost overruns, supply chain disruptions, and other technical challenges. For example, the cost of aircraft in Lots 15 to 17 was approximately $82.5 million for the F-35A, $109 million for the F-35B, and $102.1 million for the F-35C. The negotiations regarding Lots 18 and 19 were further complicated by the year-long suspension of F-35 deliveries, primarily due to issues with the hardware and software configuration of Technology Refresh-3 (TR-3). Once these issues were resolved, the suspension was lifted, and in July, the company announced the delivery of the first two F-35A Lightning II with TR-3.
Elon Musk, CEO of SpaceX, recently described manned fighter jets as “obsolete in the age of drones.” He criticized the entire program, the manufacturers, and the aircraft itself, calling it “the worst military cost-to-performance ratio in history.” It’s possible that Trump’s military spending plans could be influenced by Musk’s views. This stance may also affect decisions the new administration will need to make regarding the Next Generation Air Dominance program.
Source: theaviationist
