Lockheed wins $259 mln deal for 2 more U.S. F-35s

WASHINGTON, April 13 Fri Apr 13, 2012 11:10pm EDT

WASHINGTON, April 13 (Reuters) - Lockheed Martin Corp on Friday won a $259 million contract adding two more F-35 fighter jets to a fifth batch of jets being purchased by the U.S. military, boosting the size of that order to 32 jets, the Pentagon and Lockheed officials said.

Lockheed and the Pentagon are still negotiating the final terms of a fixed-price fifth production contract for the new radar-evading supersonic fighter jet, after reaching agreement in December on a $4 billion "undefinitized contract action" for 30 fighter jets.

Friday's deal, announced in the Pentagon's daily digest of major contracts, brings the size of the fifth order in line with the number funded in the Pentagon's fiscal 2011 budget. That fiscal year ended last September, but the negotiations got off to a late start.

It adds one conventional takeoff aircraft to the 21 already planned for the Air Force as part of the fifth production contract, and one carrier variant to the six planned for the Navy. The Marine Corps' total remains at three for this order.

Lockheed is developing and building three variants of the new Joint Strike Fighter for the U.S. military and eight countries that are helping to fund its development.

The Pentagon told Congress last month that the projected cost to develop, build and operate and maintain 2,447 jets for 55 years would be $1.51 trillion, up 8.6 percent from the previous estimate.

Turkey, which said in February it intended to buy a total of 100 F-35s, will buy only two this year, and will decide each following year how many planes it will order, Defence Minister Ismet Yilmaz told Reuters on Thursday.

The Pentagon and Lockheed remain upbeat about the future of the new fighter after a recent restructuring, but the project has hit some snags overseas.

Italy cut its total order by 41 jets to 90, due to budget pressures, and Canada last week said it was freezing a C$9 billion budget for next-generation fighters after a government watchdog report said Canada's decision to buy 65 F-35s was based on bad data that understated the program's problems.

The other partner countries are Britain, Australia, the Netherlands, Norway and Denmark.

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