Washington: Lockheed Martin now expects to finalise a contract for the next two batches of F-35 Joint Strike Fighter jets by the end of June, the company’s chief financial officer said.
Earlier this year, Lockheed executives said they expected to definitise its F-35 Lot 18 contract with the Pentagon in the first half of the year, with Lot 19 following by the end of 2025.
“We actually see that has the potential to accelerate,” Evan Scott told investors during a Bank of America conference. “What our customer is telling us now is to expect Lot 18 and Lot 19 to be combined into a single award. … the overall award now is probably going to happen later in the second quarter than if Lot 18 had been a standalone [deal].”
The Pentagon in December awarded Lockheed a $11.8 billion initial contract, known as an undefinitised contract action, which gave Lockheed a much-needed cash infusion as it continued production of the 145 jets that comprise Lot 18 in advance of a final deal that cements the value of the contract. That agreement came after a November handshake deal for Lots 18 and 19 that did not include formally announced quantities or contract amounts, but indicated that negotiations were moving forward.
Greg Ulmer, the top executive at Lockheed’s aeronautics unit, said last July that unit costs for the upcoming batch of F-35s could continue to be negatively influenced by inflation as well as a lower annual buy rate from the US military.
Scott said that F-35 production is “looking solid” to hit the 156 jets goal for 2025. F-35 deliveries are projected to hit 170 to 190 aircraft this year as Lockheed hands over aircraft in its inventory after a one-year delivery pause ordered by the Pentagon as Lockheed hammered out technical problems on the jet’s Technology Refresh 3 upgrade. (Deliveries resumed last July.)
