Lockheed Martin will build the Defense Department's next-generation stealthy Joint Strike Fighter, the Pentagon announced today.
The company has been awarded a $19 billion contract to build 14 developmental aircraft and refine its "F-35" attack fighter that will replace the F-16, AV-8B Harrier and other aircraft.
Lockheed Martin defeated Boeing to win JSF, expected to be the largest procurement program in DOD history. JSF is also the only manned fighter program being planned by the U.S. military.
Pratt & Whitney, engine supplier for both Boeing and Lockheed proposals, was also a winner today. The Pentagon awarded the engine company a separate $4.8 billion contract to provide engines for the program's systems development and demonstration (SDD) phase, formerly known as engineering and manufacturing development.
Lockheed Martin will build three highly common jet fighters for the Air Force, Navy and Marine Corps, a procurement strategy designed to lower development and support costs. Air Force Secretary James Roche, who picked the winner, said today that the Air Force version of the fighter is expected to cost $40 million in current dollars, with the other variants pegged at less than $50 million in "flyaway costs" that do not include research and development expenses.
Pentagon acquisition czar Pete Aldridge said today that the total value of the program, including production, "could be in excess of $200 billion."
"The Lockheed Martin proposal . . . emerged continuously as the clear winner," Roche said. Looking across the board at the two proposals' strengths, weaknesses and risks, he added, "It became very, very clear" that the Lockheed Martin bid was superior.
"I would not characterize it as a squeaker," Roche said at the Pentagon announcement, though Lockheed Martin did not win "by a mile," either.
The Air Force plans to procure 1,763 conventional take-off and landing JSFs, which it envisions as low-cost, multirole replacements for its F-16 and A-10 aircraft. The service expects to have the F-35 operational in 2011. The CTOL version's cost goal is $28 million per unit, measured in constant 1994 dollars.
The Marine Corps is scheduled to buy 609 short take-off, vertical landing aircraft to modernize its AV-8B Harrier and aging F/A-18 fleet. The service declined to purchase the F/A-18E/F Super Hornet when the Navy signed on to that program and has no tactical fighters in production. For that reason, the Marines are considered to have the most urgent need for JSF, which the service hopes to have flying in 2008 and operational in 2010. The STOVL variant is designed to cost $35 million.
The Navy plan is to purchase 480 carrier versions to complement the Super Hornet with a survivable strike aircraft and allow for the retirement of its F-14 Tomcats. The service expects to begin flying its initial JSFs in 2012. Because of the structural modifications needed for carrier ops, the Navy variant is the most expensive -- estimated at $38 million per unit in 1994 dollars.
The U.K. Royal Navy is a potential buyer of 60 STOVL units to replace British Harriers. Britain's Royal Air Force has also selected JSF as the preferred replacement for its GR7s, and the Royal Navy will probably replace aging Sea Harriers with the stealthy fighter. Overall, the nation has committed to purchasing 150 of the aircraft.
Aldridge said DOD decided against splitting the work between the competitors, as some have advocated, because the winner-take-all strategy is the best-value approach. Lockheed Martin put a team of subcontractors together with a certain type of program in mind, he said, and Boeing will continue to build manned fighters for at least another decade. Further, Boeing is still in the early stages of the Unmanned Combat Air Vehicle program.
Competition among suppliers for subsystems such as engines and radars will be an option in the future, Roche added.
Lockheed Martin will assemble the strike fighters at its Fort Worth, TX, assembly facility. In an interview this week with InsideDefense.com, Harry Blott, Lockheed Martin vice president for JSF, said the company expects to need about 4,000 additional people at the facility during the F-35's SDD phase. This will increase employment at the mile-long assembly plant from 10,000 today to 14,000, he said.
Lockheed Martin also builds the F-16 in Fort Worth, and Blott said the company has enough orders in the pipeline to continue F-16 production for another 10 years. He said the plant has more than enough capacity to accommodate F-16 and JSF work simultaneously.
International sales are a major part of the JSF plans. The United Kingdom has committed $2 billion to support the SDD phase, and the current U.S.-U.K. total requirement of about 3,000 JSFs is expected to double when other foreign sales begin to flow. For example, the Lockheed Martin F-16 has been a popular aircraft with air forces worldwide and is just one of several platforms JSF will replace.
The JSF office itself says there will be "up to 3,000 international JSFs," according to a program office overview briefing.
Jon Schreiber, JSF director of international programs, told reporters earlier this year that "getting in early" benefits international partners because it would allow them to help shape the next-generation fighter's requirements. The only committed SDD partner at this time is the United Kingdom. By prior agreement, the United Kingdom will be the only "level one" JSF partner, which gives the country the most international influence on the program.
Exactly what aircraft allies will be purchasing is still to be determined, however -- no U.S. stealth aircraft has yet been sold abroad. With an eye on the foreign market, military officials decided early on to "build in tailorability," Schreiber said in an interview last year.
This approach means "anything unique that a country wants us to put on their Joint Strike Fighter, it will allow us to do that. . . . Our goal right now is to make this aircraft as common as possible within national disclosure policy constraints," Schreiber said. "If there are things we can't accommodate, that are outside that goal, then this approach will allow us to do that."
SDD was supposed to begin with a downselect last spring, but Congress stepped in and extended the just-ended concept demonstration phase because of concerns that JSF would not be ready to move into SDD on the original schedule, leading to more delays and cost growth later in the program. Just last week, the General Accounting Office released a report contending that eight critical JSF technologies are not mature enough to safely move forward in the program.
DOD disputed those findings in comments on a draft of the report. Today, Aldridge noted that the Defense Acquisition Board determined Wednesday that the program is ready to move forward.
Unlike many DOD acquisition programs, JSF is being designed with cost as an independent variable. This means that, with the exception of a small number of critical performance requirements, most other performance criteria were considered "tradable" in order to keep the fighter's acquisition costs within target ranges.
Another way the fighter is supposed to reduce long-term military expenses is by requiring less support than the legacy aircraft JSF will replace. These support-cost improvements are critical because about 60 percent of a fighter airplane's total life-cycle cost is tied to sustainability -- compared to 40 percent for the research, development and procurement costs that get the lion's share of the attention when program acquisition costs are debated.