Dutch orders for the Pentagon’s F-35 warplane are likely to be cut back, sources close to the discussions told Reuters, citing cost overruns and delays in the program, uncertainty over the Netherlands’ defense strategy and budget cuts across Europe.
The Netherlands may cut 17 to 33 F-35s from its initial plans to buy 85 of the new warplanes, according to people close to the discussions who were not authorized to speak publicly since final decisions are not expected until later this year.
U.S. officials fear cuts in orders by the Dutch or other buyers could trigger a “death spiral” in the Pentagon’s biggest arms program by driving up the price of remaining orders, leading to more cancellations. Washington alone has already delayed 410 of its 2,443 orders beyond 2017.
Built by Lockheed Martin Corp, the F-35 Joint Strike Fighter is designed to be the next-generation fighter jet for decades to come for the U.S. Air Force, Navy and Marines, as well as U.S. allies in Asia and Europe.
But the $400 billion weapons project, which is developing a replacement for the F-16 fighter jet and nearly a dozen other warplanes in use, has been hit by technical faults, is seven years behind schedule and 70 percent above early cost estimates.
The Netherlands is one of several allies, along with Britain and Italy, that are deeply invested in the program. So far it has spent a total of 1.233 billion euros ($1.59 billion) on its involvement, the General Auditor reported in October.
However, continued Dutch participation in the project and the size of future orders are under increasing scrutiny as the euro zone’s fifth biggest economy has been forced to come up with billions of euros in government spending cuts, while the two parties in the ruling coalition are at odds over the F-35.
Prime Minister Mark Rutte’s Liberal Party, re-elected in September, has always been in favour of the F-35, but his new coalition partner, Labour, called in July for ending Dutch participation in the project. The plane’s rivals are lobbying hard for cancellation, according to Dutch media reports.
The Netherlands was slated to buy 85 F-35 A-models to replace its F-16 fighter jets. But the former defense minister last year said the government would buy as few as 56 F-35s because costs had risen and only 68 F-16s needed to be replaced.