CANBERRA/WASHINGTON Feb 25 This year's second
grounding of Lockheed Martin Corp's vaunted
F-35 warplane, plus looming U.S. defence cuts, are likely
to complicate a push this week by Lockheed and U.S. officials to
convince wary Australian lawmakers and generals to
stick to a plan to buy 100 of the jets.
Australia, a close American ally, is considering doubling
its fleet of 24 Boeing Co F/A-18 Super Hornets amid
delays and setbacks in Lockheed's $396 billion F-35 project.
That means Canberra could buy far fewer F-35s than initially
planned, at a critical time when Canada is also rethinking its
plans to make the F-35 - also known as the Joint Strike Fighter
(JSF) - its future frontline warplane.
Budget cuts have already forced Italy to scale back its
orders, and Turkey has delayed its purchases by two years,
though orders from Japan and Israel have buoyed the
firm, and additional Israeli orders are expected in 2013.
Singapore has also taken a more active interest in the
radar-evading jet, and South Korea is expected to announce a
winner in its fighter contest late this year.
Australia and others are watching orders and problems with
the jet with growing concern, since every reduction drives up
the price of the remaining fighters to be built.
Given that, Friday's news that the plane was being grounded
for the second time in two months, this time after a routine
inspection revealed a crack on a turbine blade, was especially
inopportune for Lockheed.
"It is a nuisance," said a spokesman for the Dutch defence
ministry, which has already paid for two test planes but will
determine the size of its total F-35 order later this year. "We
wait for results of the inquiry."
Australian officials know the stakes are high.
"We're only a small player, but other countries are
watching. Of course Lockheed don't want to see orders
vanishing," said a source at Australia's Defence Materiel
Organisation, part of the defence department, who was not
authorised to speak publicly.
U.S. Lieutenant General Christopher Bogdan, the Pentagon's
F-35 program chief, approved the fleetwide grounding just before
leaving Washington for a major air show in Melbourne, Australia
which starts this week, when it will draw attention from
potential customers in Asia.
Lockheed executives have been trying to reassure Canberra
that the JSF is on course. They insist that problems with
software and design, including imaging and night vision
functions of the pilot's helmet, are being resolved, and testing
is ahead of schedule.
One U.S. defence official, who was not authorised to speak
publicly, said the technical problems bedevilling the new
fighter were less troubling than Washington's budget woes.
Sweeping budget cuts due to take effect in the United States
on March 1 could cut funding for the Pentagon's biggest weapons
program and delay work on seven jets this year alone.
"What the foreign partners worry about is the stability of
the program writ large," said the official. "We're solving the
technical challenges. There are no showstoppers there, although
they're not cheap."
In the U.S., military budgets are already slated to be cut
by nearly $500 billion over the next decade, an amount which
could double unless Congress acts in the next week to
avert spending reductions known as "sequestration".
Australia's yearly defence budget of A$26.3 billion ($27.10
billion) was cut by 10.5 percent to A$24.2 billion this fiscal
year, while the military's estimated budget to 2015-16 was
slashed by A$5.5 billion.
Australia will decide at the end of this year on the timing
of an order for an initial 12 F-35s while it considers options
to replace 71 early model F/A-18 fighter jets and a recently
retired fleet of 24 Vietnam-era F-111 supersonic bombers.
After the latest grounding, a former Australian defence
minister in the Labor government, Joel Fitzgibbon, criticised
the country's military commanders for their "obsession" with the
"I think there is an almost obsession with the JSF within
the uniformed ranks. This is their brand new toy," Fitzgibbon,
who still holds a senior government role, told local media.
Many defence insiders expect plans for a fleet of F-35s to
be revised to feature 48 Super Hornets - 12 equipped as EA-18G
Growlers with radar-jamming electronic weapons - and as few as
50 Joint Strike Fighters.
A source familiar with the matter said Canberra's decision
could come within the next three to six weeks.
"The Super Hornets will eat into F-35 orders," said Sam
Roggeveen, a former Australian government intelligence and arms
analyst, now with the Lowy Institute security think tank.
"It's not too crude to say it will be a one for one
replacement, because so far that's the kind of basis that
defence has so far been working on anyway," Roggeveen said.
MASSIVE U.S. ORDER
F-35 program vice-president Steve O'Bryan and executive
vice-president Tom Burbage, who is retiring at the end of next
month, have travelled to visit all the program's international
partners in recent weeks.
"We will continue to drop the price of the airplane out to
approximately 2020 where the U.S. government estimate is for an
airplane, with the engine and all mission equipment, to be
approximately $67 million," O'Bryan said in Australia last week.
Lockheed is building three different models of the F-35
fighter jet for the U.S. military and eight countries that
helped pay for its development: Britain, Canada, Italy, Turkey,
Denmark, the Netherlands, Australia and Norway.
The Pentagon plans to buy 2,443 of the warplanes in the
coming decades, although many analysts believe U.S. budget
constraints and deficits will reduce that number.
The Lowy Institute's Roggeveen said the F-35 and Lockheed
would survive even a serious drop in foreign orders.
"The scale of the order from the U.S. is so much bigger than
international customers that Lockheed are not anywhere near the
point of desperation."