Pentagon sees slight drop in F-35 acquisition costs: sources

WASHINGTON Thu May 23, 2013 3:21pm EDT

Workers can be seen on the moving line and forward fuselage assembly areas for the F-35 Joint Strike Fighter at Lockheed Martin Corp's factory located in Fort Worth, Texas in this October 13, 2011 handout photo provided by Lockheed Martin. REUTERS/Lockheed Martin/Randy A. Crites/Handout

Workers can be seen on the moving line and forward fuselage assembly areas for the F-35 Joint Strike Fighter at Lockheed Martin Corp's factory located in Fort Worth, Texas in this October 13, 2011 handout photo provided by Lockheed Martin.

Credit: Reuters/Lockheed Martin/Randy A. Crites/Handout

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WASHINGTON (Reuters) - The Pentagon's annual report to Congress shows a decline of $4.5 billion, or just over 1 percent, in the projected development and acquisition cost of the Lockheed Martin Corp (LMT.N) F-35 fighter jet program, sources familiar with the data said on Thursday.

The U.S. Defense Department now projects the cost of developing and building the new radar-evading jet - the largest U.S. weapons program - to be $391.2 billion, down from last year's estimate of $395.7 billion, said the sources, who were not authorized to speak on the record.

In its annual "selected acquisition report," the Pentagon did not revise the projected $1.1 trillion cost of operating and maintaining the fleet of 2,443 new fighter jets over the next five decades, despite ongoing work by the F-35 program office and the main contractors to drive down those costs.

Lockheed is developing three models of the supersonic, single-seat F-35 fighter for the U.S. Air Force, Navy and Marine Corps, as well as eight countries that are helping fund its development: Britain, Australia, Canada, Norway, Denmark, Italy, the Netherlands and Turkey. Israel and Japan have also placed orders for the new war plane.

Current plans call for the U.S. military to buy a total of 2,443 F-35 jets in coming years, although many analysts believe mounting budget pressures could reduce the total purchase.

(Reporting by Andrea Shalal-Esa; Editing by Gerald E. McCormick and Leslie Adler)

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