Unit Cost of F-35s Delivered This Year Still Exceeds $206M
PARIS --- The average unit cost of Lockheed Martin F-35 fighters in the ninth Low-Rate Initial Production Lot 9 (LRIP 9) is $206.3 million, according to our analysis of all 46 contracts that have been made public for Lot 9. This is just $16.7 million (or 7%) lower than the average cost of the Lot 5 aircraft ordered in 2012 – fully five years ago.
Separately, a direct comparison of Lot 5 and Lot 9 aircraft costs released by the F-35 Joint Program Office (JPO) shows that the cost of a “generic” F-35 has actually increased by $7.63 million over the same five years, 2012 to 2017. The “generic” F-35 is a notional aircraft used to compare unit costs from year to year; it is the average cost of one aircraft of each of the three versions (F-35A CTOL, F-35B STOVL and F-35C CV) in the same production lot.
JPO’s figures show that, of the three variants, only the F-35A saw its cost decline, by a modest $3 million over those five years. The cost of both other variants increased substantially (see Table 2). JPO only compares airframe costs, and for reasons it has not explained excludes engine and other costs. Both our detailed analysis of Lot 9 contracts, and the JPO’s own figures, contradict many public statements by Lockheed Martin and the F-35 Joint Program Office (JPO) claiming that unit costs are dropping with each successive LRIP lot, and that by 2019 the unit cost of an F-35A will have dropped to $85 million.
Most recently, JPO Director Lt. Gen Christopher Bogdan was quoted at a Dec. 19 press conference as again promising lower prices. “By the time the plane enters Full Rate Production in 2019, .... the price will be down to $80-$85 million for an F-35A, $110 million for a F-35B, and a $96 million for an F-35C.” This now looks more implausible than ever.
As things stand, Lot 9 aircraft being delivered today cost $206.6 million on average, including their engines, fixes, retrofits and upgrades, Furthermore, the JPO continues to award contracts for Lot 9, so it is likely the unit cost of Lot 9 aircraft will continue to grow. Four Lot 9 contracts have been awarded so far this year.
What all this shows is that neither Lockheed Martin nor the Joint Program Office have a real handle on their public statements about aircraft unit costs, which cannot be independently substantiated........... [more]