Pentagon, contractors take aim at F-35 costs

PARIS - Reuters

US officials and Lockheed Martin Corp are focused on the cost of F-35 Joint Strike Fighter operations and maintenances expectedly worth $1 trillion. REUTERS photo

With development and technology challenges on the Lockheed Martin Corp F-35 fighter increasingly under control, the company and the U.S. military are taking aim at a more vexing problem, which is the cost of flying and maintaining the new warplane.

U.S. officials worry the current $1.1 trillion price tag for operations and maintenance - sometimes called “sustainment” - will erode international support for the new Joint Strike Fighter, which is critical to ensuring the plane can be as affordable as advertised.

Lockheed is developing three models of the F-35 for the U.S. military and eight countries that are helping fund its development: Britain, Australia, Canada, Norway, Italy, Turkey, Denmark and the Netherlands. They are meant to replace more than a dozen types of warplanes now in use around the world.

“The sustainment cost is our biggest challenge,” Lieutenant General Robert Schmidle, deputy Marine Corps commandant for aviation, told Reuters in an interview at the Paris air show on June 18.

Production costs for the new single-engine jets are coming down steadily, and even the cost of retrofitting planes to deal with issues discovered during testing, or concurrency cost, is declining. But Pentagon forecasters have clung to their $1-trillion projection for the cost of operating and repairing the fleet of 2,443 radar-evading jets over the next five decades.

“We see no compelling reason to update our life-cycle O&S cost estimate for the program at this time. The evidence we have right now would indicate that our estimate remains sound,” Pentagon spokeswoman Maureen Schumann said when asked about the cost projection, which includes 50-odd years of inflation.

Officials with the Pentagon’s F-35 program office, military service officials and industry executives, however, have been questioning the operating and maintenance cost projection for years, and more detailed efforts to reduce it are now under way.

“We are attacking the various elements of that cost, trying to bring (it) down,” the Pentagon’s chief arms buyer, Frank Kendall, told reporters last week. “We’re looking very hard at bringing more competition into the sustainment phase, which I think will be very effective at driving down costs. So I think we can make a substantial dent in the current projections.”

Air Force Lieutenant General Christopher Bogdan, who runs the F-35 program for the Pentagon, has been exploring plans to open parts of the operations and maintenance to competition for about a year, but no details have yet emerged.