Lockheed Martin / Angel DelCueto
F-35 assembly, Fort Worth, Tex.

DoD Funds Long-Lead Costs for Next F-35 Round

July 18, 2023
The Pentagon issued $99.5 million to Lockheed Martin for planning and purchasing for Lot 18 of the Joint Strike Fighter program – though there is no agreement yet on the unit cost and production volumes for those aircraft.

Lockheed Martin Corp. has drawn a $99.5 million award to cover the acquisition costs of long-lead-time materials, components, and services for future production of 147 F-35 Joint Strike Fighter aircraft, specifically for Lot 18 of that expansive defense manufacturing program. Lockheed is the lead manufacturer among hundreds contributing to the program.

The U.S. Dept. of Defense issued the “firm-priced-incentive-firm-target undefinitized” payment as a modification to an earlier agreement between the Pentagon and the contract.

The DoD and Lockheed have not yet negotiated the cost and production volumes for Lot 18, but the number of jets to be produced according to the new contract modification is in line with the production volumes for Lots 15-17.

The funds will be drawn from FY 2023 budgets for the U.S. Air Force, U.S. Marine Corps, U.S. Navy, and Foreign Military Sales budgets for the F-35 program. Recently a spokesman for the Pentagon’s F-35 Program Office indicated negotiations for production of Lots 18 and 19 are on target for completion by the end of 2023. The Pentagon announced January 2027 for completion of this work assignment.

Most of the award will be directed to U.S. manufacturing centers, notably at Fort Worth, Tex., and El Segundo, Calif., where Lockheed Martin Aeronautics has operations.

At the end of 2022 DoD and Lockheed agreed to a scope and price structure for three upcoming production rounds (Lots 15, 16, 17) of F-35 aircraft, for the U.S. Air Force, U.S. Marine Corps, U.S. Navy, and Foreign Military Sales. The Lot 18 award anticipates production of aircraft for each of those buyers too, as well as non-U.S. Dept. of Defense participants.

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