The Pentagon is finalizing a contract for its next batch of F-35 aircraft that could be worth nearly $15 billion.
F-35 Program Executive Officer (PEO) Air Force Lt. Gen. Christopher Bogdan told reporters Wednesday the Defense Department was finishing up negotiations with F-35 aircraft prime contractor Lockheed Martin [LMT] on low-rate initial production (LRIP) 9 and LRIP 10 and that it should feature a lot-to-lot unit price reduction in the range of 3 to 4 percent per aircraft. Pentagon spokesman Joe DellaVedova said LRIP 9 and LRIP 10 will together feature roughly 150 aircraft.
Bogdan also said the Pentagon is close to finalizing a deal with F135 engine manufacturer Pratt & Whitney on its next batch of engines, called Lots 9 and 10. He said DoD had recently reached a “handshake” agreement with the company and that he expected this deal to be finalized in the next week or two. Bogdan added engine Lots 9 and 10 should also feature a lot-to-lot unit price decrease in the range of 3 to 4 percent.
The Air Force on Tuesday said it was delaying the purchase of five F-35A conventional variant aircraft in its fiscal year 2017 budget request. Bogdan said, despite the purchase delay, DoD was still on track for a unit price, in 2019 dollars, of $80 million to $85 million per jet. He said the contract for Lots 9 and 10 will show the Pentagon is still on track for the $80 million to $85 million unit cost.
The F-35 is developed by Lockheed Martin with subcontractors BAE Systems and Northrop Grumman [NOC]. Pratt & Whitney is a division of United Technologies Corp. [UTX]