(Changes sourcing throughout, updates figures)
By Mike Stone
WASHINGTON Feb 3 The Department of Defense and
Lockheed Martin Corp announced on Friday an agreement
worth about $8.5 billion for 90 F-35 jets, the lowest price to
date for the Pentagon's most expensive program.
The deal for the tenth lot of the stealthy fighter aircraft
brings the price per jet to below $95 million for the first
time, compared to $102 million in the previous batch, a savings
of $728 million.
This is more than the $600 million that U.S. President
Donald Trump claimed on Monday he had been able to shave off
from the F-35 program, which he had described as "out of
control" in December.
Lockheed Martin said in a statement that "President Trump's
personal involvement in the F-35 program accelerated the
negotiations and sharpened our focus on driving down the price."
The price per jet has been steadily declining as production
ramps up, and defense analysts have said the discount hailed by
Trump was in line with what had been flagged by Lockheed and
Pentagon officials for months.
"The increase in the number of aircraft in this agreement
enables us to reduce costs by taking advantage of economies of
scale and production efficiencies," Lockheed said.
Lockheed, the prime contractor, and its partners including
Northrop Grumman Corp, United Technologies Corp's
Pratt & Whitney and BAE Systems Plc have been
working on building a more cost-effective supply chain to fuel
the production line in Fort Worth, Texas.
Air Force Lieutenant General Chris Bogdan, who runs the F-35
program for the Pentagon, said on Dec. 19 the cost per plane
should decrease about "6 to 7 percent" for the latest contract.
Friday's announcement said the cost of the F-35 A
conventional takeoff and landing version of the jet had dropped
7.3 percent since the previous order.
Lockheed and its main partners have been developing and
building F-35s for the U.S. military and 10 allies.
The F-35 comes in three configurations, the A-model for the
U.S. Air Force and U.S. allies; a F-35 B-model which can handle
short takeoffs and vertical landings for the Marine Corps and
the British navy; and carrier-variant F-35C jets for the U.S.
The U.S. Defense Department expects to spend $391 billion in
the coming decades to develop and buy 2,443 of the supersonic
(Reporting by Mike Stone in Washington; Editing by Soyoung Kim
and Bernadette Baum)