LRIP 9 (44 U.S., 26 foreign aircraft) September 2012 - $2 million; May 2013 - $1.4 million
LRIP 10 (66 U.S., 34 foreign aircraft) September 2012 - $1.1 million; May 2013 - $760,000
The retrofit estimates include non-recurring engineering for the fixes. Though foreign F-35 buyers will not have to pay for these non-recurring costs (those are included in the U.S.-specific development contract), they will have to pick up the tab for the actual retrofits if they decide to install them on their aircraft, according to the JPO official. Additionally, the U.S. services have the discretion of which retrofits to install. The program office is categorizing them by those that are essential to operate the aircraft (such as safety or durability issues) versus those that are “nice to have,” the JPO official says.
Lawmakers requested these concurrency cost reports as due to concerns that these estimates were very high, adding significantly to the per-unit price of the actual aircraft. Based on the contracted target cost for LRIP 5 aircraft, the F-35 is estimated at $105 million, the F-35B is estimated at $113 million and the F-35C is estimated at $125 million. Based on the revised concurrency estimates, the Pentagon can expect to pay an additional $10 million per aircraft for retrofits; that is about 10% of the price of the F-35A.
Air Force Lt. Gen. Christopher Bogdan, F-35 program executive officer, said last winter he expects to be able to stabilize the price of the F-35A, the predominant model sought for export, at $80-90 million. At that point, in full-rate production, there should be virtually no retrofits required.
One program official said these revised concurrency estimates will be included in materials for a Defense Acquisition Board meeting this fall in which Bogdan is expected to ask Pentagon procurement chief Frank Kendall to formally approve downward revisions to the cost estimates for the aircraft and associated figures — such as sustainment — in preparation for next year’s F-35 Selected Acquisition Report (SAR) to Congress. The SAR is a sweeping report that includes costs related to the entire life cycle of a weapon system.