Exclusive: Lockheed F-35 jet price drops 6 percent to under $ 90 million – sources



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  FILE PHOTO: Israeli Air Force F-35 fighter jets fly over the Mediterranean Sea during an air show as part of the celebrations of the 70th anniversary of the creation of the state in Tel Aviv, Israel. , 2018. REUTERS / Amir Cohen / Photo File


PHOTO: Israeli Air Force F-35 fighter jets overfly the
Mediterranean Sea at an air show as part of the
celebrations for Israel's Independence Day marking the 70
anniversary of the creation of the state, in Tel
Aviv

Thomson
Reuters


By Mike Stone

FARNBOROUGH, England (Reuters) – The United States hit a
preliminary agreement to buy Lockheed Martin F-35 jets
approximately $ 13 billion, paving the way for a multi-year increase
purchase that aims to reduce the cost per jet to $ 80 million
By 2020, the sources said.

The agreement for 141 F-35 lowers the price of F-35A, the most
common version of the stealth fighter aircraft, at about 89 million,
down about 6% from $ 94.3 million in the last transaction
in February 2017, sources close to the discussions said.

Reducing the cost of the most expensive defense in the world
program is crucial to get more orders, both in the United States
States and abroad.

President Donald Trump and other US officials criticized
the F-35 program for delays and cost overruns, but the price per
jet has steadily declined in recent years as a production
increases.

The current agreement of "handshake" will be solidified with
price and other terms in a contract to be announced in
the coming weeks, according to sources, under the guise of anonymity
because the discussions were private.

The agreement with the US Department of Defense removes a
crucial road block of ongoing negotiations for a multi-year
deal for the fighters that should consist of three
tranches over the years 2018-2020.

The Pentagon and Lockheed Martin "have made progress and are in
the final stages of the negotiation, "said the head of the Pentagon.
acquisitions Ellen Lord said in a statement, adding the two parts
had reached "a handshake agreement that symbolizes the
The Department of Defense's commitment to equipping the United States and its allies
forces, while giving a "high value" to the American taxpayer.

Last summer, Reuters reported that F-35 customers, including
Australia, Denmark, Israel, Italy, Japan, Netherlands,
Norway, Turkey, South Korea, Great Britain and the United States
aiming to procure 135 or more jets during the 2018 fiscal year
delivery in 2020 for about $ 88 million per jet.

In addition, negotiations were under way for the multi-year United States.
a market that was worth more than $ 37 billion
encompassing a record 440 F-35 fighter aircraft.

But the negotiations for this 11th batch of jets are prolonged because
Pentagon leaders have deepened the program to understand it
and its costs, extending the negotiations for the multi-year "block"
to buy, "said the sources.

On Sunday, a representative of Lockheed Martin said that the handshake
agreement on the production contract for the 11th batch of F-35
planes was in place but the total value and the cost per variant
would be released when the contract was finalized.

The F-35 is available in 3 variants: the conventional F-35A take-off and
landing model; the F-35B, a short vertical take-off / landing
version; and the F-35C, used on board aircraft carriers.

The F-35 program aims to grow the fleet to more than 3,000
and brings the unit price of the F-35A closer to $ 80 million
in 2020 thanks to efficiencies gained by ordering in larger
quantifies.

The jet had production problems in 2017, but Lockheed hit again
its 2017 goal to deliver 66 to the United States and its
allies.

Lockheed aims to deliver 91 jets in 2018 and the Bethesda,
The arms manufacturer of Maryland hopes to almost triple
production to more than 160 aircraft in 2023.

Despite the challenges the program had to face, the completed roll
his flight tests in April. In May, Israel said that it had been the
first country to use the combatant in combat.

New international customers are also possible. In February, the
The US State Department has approved the possible sale of 34 F-35s to
Belgium for 6.53 billion dollars. Belgium must make a
decision on a new fighter later this year.

General Tod Wolters, General of the United States Air Force in Europe and
The commander of the Allied Army of NATO declared that the new fighter aircraft
root in Europe.

"It's a game-changing system," Wolters told Reuters.
Royal Air Air International Air Tattoo Air Show in England.
"We are integrating the F-35 into the mix
environment, not just airspace. "

Norway, Britain and Italy will have received 40 F-35s in Europe
from here the end of the year.

Lockheed is the main contractor for the jet. His partners
including Northrop Grumman Corp., United Technologies Corp.
Pratt & Whitney and BAE Systems Plc.

(Report by Mike Stone in London;
Andrea Shalal; Editing by Mark Potter)

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