Latest F-35 Deal Targets Unit Cost Below $100 Million

By Amy Butler
Source: AWIN First

Based on a May report, the Pentagon estimates that each of its aircraft in LRIP 6 and 7 would require another $7.4 million for retrofits. In LRIP 6-7, the government and company have agreed to split equally the cost of those known retrofits at the time of contract signature. Any new problems that crop up in flight trials will require full payment by the government, according to a company statement.

Based on what is known of engine cost, retrofit estimates and the target-unit cost projections, an F-35A in LRIP 6 would cost the U.S. government a total of roughly $120.5 million and $116.5 million in LRIP 7.

Likewise, using these estimates, the F-35B is estimated at $150.2 million in LRIP 6 and $145.9 million in LRIP 7. These calculations include only half of the retrofit estimate provided by the Pentagon to Congress in May because the company would be required to pay for the other half.

LRIPs 6-7 will be the first contract for which Lockheed Martin assumes all responsibility for exceeding the target cost of the air vehicles, according to Rein.

International customers would not be required to pay the same retrofit costs as the U.S. government, as the Pentagon is picking up the nonrecurring engineering to develop the fixes.

LRIP 6 includes 18 F-35As for the U.S. Air Force; six F-35Bs for the Marine Corps and seven F-35Cs for the Navy. It also includes three F-35As for Italy and 2 for Australia.

LRIP 7 includes 19 F-35As for the U.S. Air Force; six F-35Bs for the Marine Corps and four F-35Cs for the U.S. Navy. It also includes another 3 F-35As for Italy, two F-35As for Norway and one F-35B for the United Kingdom.

Air Force Lt. Gen. Christopher Bogdan, F-35 program executive officer, said last winter he expected to stabilize the F-35A unit price at $80-90 million at full-rate production, when no retrofits should be required.

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