Lockheed Martin Seeks More F-35 Sales in Europe as Unit Price Drops

Lockheed Martin is expecting to sell more of its F-35 fighter jets in Europe- specifically to Germany, Finland and Switzerland amidst an expected price drop to around $80 million a piece.

The F-35 Jet is already in service with the United Kingdom and has been selected by the Netherlands, Belgium and Turkey making it the dominant future fighter jet in the continent amidst a European nations’ plan – specifically the UK, France and Germany to develop their own fifth generation jets.

The price of one F-35A standard take-off and landing variant now stands at $89.2 million while that of a F-35B short takeoff/vertical landing variant is the most expensive of all costing $115.5 million each, and an F-35C carrier variant is valued at $107.7 million per fighter.

Price per aircraft will fall with the increase in production due to efficiency in production process and lower the cost levied on raw materials and components.

The company intends to negotiate upcoming multiyear contract with the Joint Program Office (JPO). Increasing production activity for a prolonged period in a multiyear contract with steady cashflow will decrease the price per aircraft to less than $80 million.

Increasing the production rate would require coordination with the JPO, the supply chain and international customers, but Hewson said the company could handle increased demand. “Our target is to continue to drive the unit cost down in the program as it continues to mature and grows," Marillyn Hewson, Lockheed Martin's CEO said.

The company delivered 91 jets last year and is planning to increase that number to 131 this year. Lockheed Martin is expecting to increase the rate of deliveries to 161 aircraft annually, within two years. "We could certainly go to a higher rate if the demand were such that we needed to do that,” Hewson said.

According to the company, the US and 12 other countries are either part of the program of record or are committed to purchasing F-35 fighters. Germany, Switzerland and Finland are considering purchasing the F-35.