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Pentagon, Lockheed agree F-35 upkeep deal worth up to $6.6B

Photo: Lockheed Martin

The Pentagon has awarded Lockheed Martin annualized contracts for the sustainment of the global F-35 Joint Strike Fighter fleet covering fiscal years 2021-2023.

The contracts have a potential value of up to $6.6 billion, should all options be exercised.

As per the agreement, the cost per flight hour is scheduled to drop by 8 percent by 2023 for the F-35A variant, which would mean that the cost per flight hour in 2023 should be $33,400, compared to the current $36,100.

“Working together with our industry partner, the F-35 Joint Program Office team negotiated aggressive cost savings and performance targets that will benefit the global F-35 sustainment enterprise, and all F-35 customers,” Lt. Gen. Eric Fick, program executive officer of the F-35 Joint Program Office, said in a Pentagon release.

The annual contracts fund critical sustainment activities for aircraft currently in the fleet and build enterprise capacity to support the future fleet of more than 3,000 F-35 aircraft, Lockheed Martin added.

The agreement also includes industry sustainment experts supporting base and depot maintenance, pilot and maintainer training, and sustaining engineering for the U.S. and our allies across the globe.

Fleet-wide data analytics and supply chain management for part repair and replenishment to enhance overall supply availability for the fleet are also included in the deal.

The company added that the contracts also paved the way for a longer-term, performance based logistics (PBL) agreement for the F-35 program. PBLs are an industry best practice, facilitating agile sustainment solutions for the fleet and incentivizing further affordability and performance results.

“Together with the F-35 Joint Program Office, we recognize the critical role the F-35 plays in supporting our customers’ global missions and the need to deliver this capability affordably,” said Bridget Lauderdale, Lockheed Martin vice president and general manager of the F-35 program. “These contracts represent more than a 30% reduction in cost per flying hour from the 2020 annualized contract, and exemplify the trusted partnership and commitment we share to reduce sustainment costs and increase availability for this unrivaled 5th generation weapon system.”