Lockheed Martin Plans to Reduce F-35 Fighter Jet Cost To $80 Million Apiece by 2020

Lockheed Martin plans to reduce per unit cost of F-35 fighter jet to $80 million by 2020.

With the incorporation of lessons learned, process efficiencies, production automation, facility and tooling upgrades, supply chain initiatives and more – the F-35 enterprise has already significantly reduced costs and improved efficiency, the company said in a statement Monday.

Last Friday, Lockheed Martin delivered the sixty sixth F-35 aircraft for the year, meeting the joint government and industry delivery target for 2017.

Sixty-six F-35 deliveries in 2017 represents more than a 40 percent increase from 2016.The F-35 enterprise is prepared to increase production volume year-over-year to hit full rate of approximately 160 aircraft in 2023, , the company said.

The current unit cost of F-35A is $94.6 million (low rate initial production lot 10 (LRIP 10) including F135 engine). The full production in 2018 is to be $85 million. The F-35B will costs $122.8 million per unit (LRIP 10 including engine) and the F-35C costs $121.8M (LRIP 10 including engine) a piece.

According to the press statement, the price of an F-35A has come down more than 60 percent from the first contract. Touch labor has been reduced by about 75 percent over the last five years and production span time has decreased by about 20 percent since 2015.

However, the US Government Accountability Office in its October 2017 report stated that US Department of Defense has taken actions to reduce F-35 fighter sustainment costs, but the estimated life cycle costs have increased and are not fully transparent to the military services.

The report also stated that the shortage of spare parts for the F-35 aircraft has degraded readiness. The aircraft were not able to fly about 22 per cent of the time in the past year due to shortage of spares.