Wednesday 27 April 2022

Lockheed Martin’s (LMT) $398 Billion F-35 at Risk of Costly Fixes, GAO Says

US Air Force / Tristin English


Lockheed Martin’s (LMT) $398 Billion F-35 at Risk of Costly Fixes, GAO Says - Bloomberg
  • U.S. and allies face added expenses for potential retrofits
  • Combat simulation tests may unearth costly flaws: watchdog
ByAnthony Capaccio

April 25, 2022, 9:57 PM GMT+7

The U.S. and allies buying Lockheed Martin Corp.’s F-35 may face millions in added costs if serious problems emerge during long-delayed combat simulation tests of the fighter jet, according to Congress’s watchdog agency.

The annual report by the Government Accountability Office is a reality check on likely add-ons to the three-year-old, $398 billion estimated cost of acquiring the planes. F-35s have received renewed attention with their deployment to Eastern Europe, Germany’s announcement of plans to to buy 35 of the planes and fresh NATO interest in its “dual capability” to carry a nuclear bomb following Russia’s invasion of Ukraine.

Lockheed has delivered more than 750 of a potential 3,300 jets to the U.S. and partners. They are in operation in nine nations, including South Korea, the U.K. and Israel, and deliveries continue even as the final round of simulated tests against the most advanced air defenses and aircraft of adversaries remains in limbo. It most recently had been scheduled for December 2020, three years late. 

While the U.S. “is purchasing aircraft at these high rates, those that are already in the fleet are not performing as well as expected,” the GAO said.

Completion of the combat testing is legally required before full-rate production -- the point when a program should have demonstrated an acceptable level of performance and reliability and is ready for higher manufacturing rates.

“If the full-rate production decision occurs in 2023, we estimate that the program will have delivered 1,115 aircraft before finishing operational testing,” or about one-third of the total projected to be purchased by the U.S. and partner nations, and foreign military sales, which “increases risk,” the watchdog agency said.

“It means that more aircraft will need to be fixed later if more performance issues are identified, which will cost more than if those issues were resolved before those aircraft were produced,” according to the report.

Software Upgrade
Separately, the cost of the Defense Department’s program to regularly upgrade software to handle new weapons has risen by $741 million since 2020 to about $15 billion and will stretch to 2029, or three years later than planned.  That effort “is continuing to experience cost growth and schedule delays,” the GAO said in its evaluation of the upgrade, called Block 4.

The Pentagon also continues to grapple with five previously undisclosed deficiencies with the aircraft’s on-board system to prevent fuel tank fires as well as with the engines, rudder and electronic combat system, the GAO said.

The flaw in the aircraft’s system for preventing wing fuel-tank fires “increases the risk of explosion in the event of a lightning strike.” The program office “is currently identifying the root cause” and “a way to fix it,” the GAO said. 

The F-35’s total projected cost for now is $1.7 trillion, which includes $1.3 trillion in estimated operations and sustainment over 66 years. “We were unable to determine the extent to which F-35 program costs changed” because the “F-35 program office did not provide an update on total program cost more recently than as of December 2019,” the GAO said.

The report doesn’t include Defense Department responses. The program office in prior years has issued comments after the report’s release. 

Laura Siebert, a spokesperson for Bethesda, Maryland-based Lockheed, said in a statement that “we have not received the latest GAO report but recognize these reports are a snapshot in time. Working closely with our customers and the Joint Program Office, we have been addressing previous GAO recommendations.”

Source bloomberg.com

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via usni.org


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