DoD F-35 Joint Program Office
F35 Sustainment 2020 800 6044dfea049c2

Lockheed, Pentagon Settle on Substandard F-35 Parts

March 7, 2021
Spares and replacement parts were delivered without electronic data records, leading to a $71-million agreement that recognizes Lockheed’s improvement in the supply process and commitment to further progress.

Lockheed Martin and the U.S. Defense Contract Management Agency have a $71-million agreement for Lockheed to compensate the Defense Dept. for substandard or defective parts supplied for F-35 fighter jets between 2015 and 2020.

During that period, spare parts and subsystems for F-35 maintenance were delivered without the requisite electronic data records for individual components’ history and remaining service life. Such data is critical for aircraft maintenance. Each F-35 reportedly has about 1,000 parts (among about 50,000 total per aircraft) that require individual data records.

F-35 maintenance technicians were said to be unable to perform their work properly or on time due to the unavailability of those records. One report claimed that in a single 2018 delivery, 80% of the supplied parts could not be installed because of missing data records.

The issue was first reported last summer, and the outline of the agreement was completed last September. Lockheed and the DoD contracts management agency reached the agreement in January, but it was not reported until this month.

Previously, the Pentagon reported that Lockheed's 2021-2023 support contract requires that 99% of delivered parts must include the required information in order for Lockheed to collect its contract fees. "As of June 2020, we're at 83% and climbing" and "we expect 90% (or higher)" by Dec. 31, according to a statement from July 2020.

Part of the settlement includes the Defense Contract Management Agency recognizing that Lockheed has made $36.3 million in private investments to improve performance metrics. The remaining $34.3 million will be invested by Lockheed (including at least $24.3 million through 2026) “to benefit the F-35 enterprise.” The remaining $10 million will be directed to standardizing records to improve sustainment operations, according to an agency spokesman.

Reportedly, the 2021 defense spending bill includes a provision requiring the Pentagon to outline the settlement details in the FY 2022 budget.

The F-35 is a series of three different, single-engine aircraft with Stealth capability and designed for ground attack and combat. It's deployed by the U.S Air Force, U.S. Marine Corps, and U.S. Navy, and the defense forces of multiple allied nations. Each aircraft is valued at $89.2 million to $115.5 million, depending on the model, and while Lockheed is the lead contractor there are hundreds of suppliers included in the program, the largest for the DoD.

To date, about 550 of the aircraft have been delivered to the USAF, USMC, and USN, and U.S. allies' defense forces.