(Adds details on cost per plane, quotes from general, byline)
By Andrea Shalal
WASHINGTON, April 17 The Pentagon on Thursday
forecast the cost of developing and buying Lockheed Martin
Corp's F-35 fighter jet at $398.6 billion, up 2 percent
from last year, but said the projected cost to operate and
maintain the jets was down about 9 percent.
The total cost of the F-35 Joint Strike Fighter, the
Pentagon's costliest weapons program, is now seen at $1.42
trillion, down about 6 percent from $1.50 trillion, including
research, development, procurement and operations through 2065.
Air Force Lieutenant General Chris Bogdan said the higher
acquisition cost was mainly due to postponed orders by the U.S.
military and some allies. But he said he was unhappy about a
$4.3 billion increase in costs on the plane's engine, which is
built by Pratt & Whitney, a unit of United Technologies Corp
Bogdan told reporters that growing demand for the new
fighter jet would drive procurement costs lower in coming years,
citing potential orders from South Korea, Israel, and Singapore.
But he said the Pentagon's F-35 program office continued to
work closely with Lockheed and Pratt to drive down the cost of
building, flying and maintaining the plane.
The Pentagon report estimated the total "lifecycle" cost of
the U.S. F-35 fleet at $1.02 trillion, including inflation, down
from $1.11 trillion a year earlier, but the F-35 program office
said improving reliability and other adjustments meant the
number would be closer to $917 billion.
Bogdan said the huge fighter jet program was making steady
progress, but there was more hard work to do to complete flight
testing, which is about 55 percent complete, drive down costs
and start assembling planes in Italy and Japan.
"I'm pretty pleased," he said. "But there's a lot of work to
go. We're still in the catch-up phase."
Lockheed is building three F-35 models for the United States
and eight countries that paid for its development: Britain, the
Netherlands, Canada, Australia, Norway, Denmark, Turkey and
Italy. The program's cost is 70 percent over initial estimates,
but costs have stabilized since a major restructuring in 2012.
The latest report estimated the average procurement cost of
the F-35 would be $138.9 million in then-year dollars, or $162.2
million, including the cost of research and development.
Bogdan said Pratt was spreading its overhead costs over a
smaller base, given a dip in its commercial bases, and said the
company needed to adjust more quickly to the altered market.
Lockheed spokesman Michael Rein said the new report showed a
significant reduction measured in 2012 dollars, the second
consecutive year that costs had come down, but the company
remained committed to further cost reductions.
"We are confident that as the program continues to grow and
mature costs will continue to decrease," he said.
Pratt said it had an aggressive cost-cutting program in
place and was continuing to pursue reductions in its supply
chain, manufacturing process and overhead rates.
Pratt spokesman Matthew Bates said the company had invested
in its factory based on expected orders, but nearly 500 engines
had been postponed from 2013 to 2016, a 25 percent reduction in
the factory's projected workload.
Despite those cuts and lower spare parts orders for the F119
engine used on the F-22 fighter jet, Pratt continued to lower
the price in each successive F-35 engine contract, he said.
"Everyone understands how important it is to deliver an
affordable, dependable engine; it is our highest priority."
(Reporting by Andrea Shalal; Editing by Bill Trott and Cynthia