{"id":52133,"date":"2020-07-22T18:54:59","date_gmt":"2020-07-22T18:54:59","guid":{"rendered":"https:\/\/one.sightlinemg.com\/defensenews\/uncategorized\/2020\/07\/22\/lawmakers-put-lockheed-under-pressure-to-pay-back-pentagon-for-f-35-parts-problems\/"},"modified":"2026-08-07T23:55:35","modified_gmt":"2026-08-07T23:55:35","slug":"lawmakers-put-lockheed-under-pressure-to-pay-back-pentagon-for-f-35-parts-problems","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/defensenews\/air\/2020\/07\/22\/lawmakers-put-lockheed-under-pressure-to-pay-back-pentagon-for-f-35-parts-problems\/","title":{"rendered":"Lawmakers pressure Lockheed to pay back Pentagon for F-35 parts problems"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">WASHINGTON \u2014 Lockheed Martin\u2019s F-35 program head on Wednesday refused to commit to fully compensating the U.S. Defense Department for <a href=\"https:\/\/www.defensenews.com\/air\/2019\/06\/12\/inventory-management-failures-are-grounding-f-35-jets\/\" target=_blank>delivering parts not ready to be installed on the jet<\/a>, which may have resulted in more than $183 million in labor costs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cIt\u2019s not all associated with Lockheed Martin performance. There are many aspects associated with [parts that are] not ready for issue,\u201d Greg Ulmer, Lockheed\u2019s vice president for the F-35 program, told <a href=\"https:\/\/www.defensenews.com\/congress\/2020\/06\/23\/house-committee-targets-lockheed-in-probe-of-f-35-parts-problems\/\" target=_blank>the House Oversight and Reform Committee<\/a>. \u201cI\u2019m committed to meeting with the Defense Contract Management Agency as well as the [government\u2019s F-35 Joint Program Office] to sit down and reconcile the concerns and adjudicate the cost appropriately.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It was a response that lawmakers on the committee \u2014 which held a hearing July 22 to explore the beleaguered jet\u2019s ongoing sustainment problems \u2014 were not happy with.<\/p>\n\n\n\t<aside class=\"smg-interstitial-link wp-block-smg-interstitial-link\">\n\t\t<a href=\"https:\/\/one.sightlinemg.com\/defensenews\/air\/2020\/03\/16\/congressional-watchdog-skeptical-on-new-f-35-logistics-system\/\" class=\"smg-interstitial-link__inner\">\n\t\t\t\t\t\t\t<div class=\"smg-interstitial-link__media\">\n\t\t\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"300\" height=\"200\" src=\"https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/6125697.jpg.jpg?w=300\" class=\"smg-interstitial-link__image wp-post-image\" alt=\"\" \/>\t\t\t\t<\/div>\n\t\t\t\t\t\t<div class=\"smg-interstitial-link__content\">\n\t\t\t\t<span class=\"smg-interstitial-link__kicker\">Related<\/span>\n\t\t\t\t<h3 class=\"smg-interstitial-link__title\">Congressional watchdog skeptical on new F-35 logistics system<\/h3>\n\t\t\t\t\t\t\t\t\t<p class=\"smg-interstitial-link__excerpt\">The Government Accountability Office wants more details about the cost and design of the Operational Data Integrated Network, or ODIN.<\/p>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/a>\n\t<\/aside>\n\t\n\n\n<p class=\"wp-block-paragraph\">Much of the hearing\u2019s discussion centered on <a href=\"https:\/\/www.dodig.mil\/reports\/audits-and-evaluations\/article\/1877598\/audit-of-f35-readyforissue-spare-parts-and-sustainment-performance-incentive-fe\/\" target=_blank>a June 2019 report<\/a> from the Defense Department\u2019s inspector general, which found that the department may have paid up to $303 million in labor costs since 2015 to correct wrong or incomplete \u201celectronic equipment logs\u201d or EELs. Since then, the Defense Contract Management Agency revised that estimate to at least $183 million, said Rep. Carolyn Maloney, the committee\u2019s chairwoman.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThat\u2019s $183 million that the American taxpayers were forced to pay because Lockheed Martin failed to meet the requirements of its contract,\u201d Maloney said in her opening comments.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The F-35 program is the only program to link an aircraft part to an EEL, which serves as an electronic record of the part\u2019s usage and life span and can be used by the military to inform maintenance and buying practices.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But since 2015, Lockheed has delivered more than 15,000 parts <a href=\"https:\/\/www.defensenews.com\/air\/2018\/06\/01\/some-of-the-oldest-f-35s-on-the-globe-are-forced-to-sit-and-wait-for-upgrades\/\" target=_blank>to the U.S. services<\/a> with incorrect or incomplete EEL information that prevented maintainers from being able to register a part in the F-35\u2032s logistics system, the inspector general report found. As a result, military maintainers and Lockheed support personnel <a href=\"https:\/\/www.defensenews.com\/air\/2019\/02\/01\/bad-data-in-f-35-logistics-system-resulting-in-lost-missions\/\" target=_blank>were forced to spend hours troubleshooting these problems<\/a>, racking up additional costs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cEvery time a pilot gets into those planes and flies into the sky, they\u2019re risking their life,\u201d Maloney told Ulmer. \u201cA contract is a contract. And the contract says you will deliver a plane \u2014 which you\u2019ve done beautifully, it\u2019s a beautiful plane. But it also says that the material that is needed to fly that plane have to be delivered too.\u201d<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1200\" height=\"857\" src=\"\/wp-content\/uploads\/2026\/08\/2173960.jpg.jpg\" alt=\"\" class=\"wp-image-35369\" srcset=\"https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/2173960.jpg.jpg 1200w, https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/2173960.jpg.jpg?resize=300,214 300w, https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/2173960.jpg.jpg?resize=768,548 768w, https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/2173960.jpg.jpg?resize=1024,731 1024w\" sizes=\"auto, (max-width: 1200px) 100vw, 1200px\" \/><figcaption class=\"wp-element-caption\">From the factory floor \u2026 Lockheed Martin employees work on the F-35 Lightning II Joint Strike Fighter production line in Fort Worth, Texas. Defense Contract Management Agency LM Fort Worth Keystones support the vital Department of Defense mission of administering Joint Strike Fighter contracts. (Defense Contract Management Agency)<\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Lt. Gen. Eric Fick, who leads the Pentagon\u2019s F-35 Joint Program Office, said that Lockheed and the department are currently negotiating a compensation package that will allow the government to recoup some of those expenses.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cMy understanding is that the team has come to an agreement relative to the magnitude of the issue of the problem, but that the consideration offer demanded has not yet been agreed to,\u201d he said. In other words, Lockheed and the Pentagon have agreed on the scope of the agreement, but not how much money Lockheed will pay back to the department.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Lawmakers asserted that, as Lockheed continues to rake in money from its contracts with the Defense Department, the company should be doing more to invest in solutions to the F-35\u2032s technical problems.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The committee\u2019s top Republican, Rep. James Comer of Kentucky, repeatedly asked Ulmer about <a href=\"https:\/\/www.defensenews.com\/top-100\/\" target=_blank>Lockheed\u2019s recent earnings and revenue<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWith all of this profit, why is Lockheed failing to fulfill the contract and deliver EELs intact and on time?\u201d Comer said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Rep. Stephen Lynch, D-Mass., said it was unfair for Lockheed to accept contractually permitted incentive payments when the F-35 has so many issues, and he warned that the company could suffer \u201creputational damage\u201d unless future contracts become more fair.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cI do believe the F-35 is probably one of the finest aircraft out there \u2014 when it flies. When it flies. And that\u2019s the problem,\u201d he said. \u201cSo you\u2019re on notice, Mr. Ulmer.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Ulmer responded that Lockheed has spent $30 million to resolve a problem with the electronic logs, and that the company is negotiating in good faith with DCMA on a financial solution on the labor issue.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWe\u2019ve had six direct meetings with the DCMA since April 2. We were meeting with the DCMA prior to April 2 to work on this issue together,\u201d he said. \u201cYou have our resolve to fix this problem.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Maloney also called on Lockheed to deliver internal documents related to the issue that she requested in a June 18 letter, saying that the company had yet to provide some information.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cIt\u2019s upsetting to me. If you can\u2019t deliver a document, I have no trust that you can deliver a plane that\u2019s going to operate [correctly],\u201d she said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><b>Making improvements<\/b><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As late as last year, the problem of managing electronic logs for spare parts was so serious and systemic that it was designated a \u201ccategory 1\u201d deficiency \u2014 the Pentagon\u2019s label for critical technical flaws that restrict the jet\u2019s ability to be ready for combat or perform its primary missions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But on Jan. 13, it was downgraded to the lesser \u201ccategory 2\u201d status because of \u201cdata quality improvements\u201d that \u201chave reduced the frequency and magnitude of issues that have impacted operational units\u2019 abilities to quickly release aircraft for flight following maintenance,\u201d the F-35 Joint Program Office <a href=\"https:\/\/www.defensenews.com\/smr\/hidden-troubles-f35\/2020\/04\/24\/five-f-35-issues-have-been-downgraded-but-they-remain-unsolved\/\" target=_blank>told Defense News in April<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Ever since the IG report was released last year, the Defense Department has taken major steps to try to fix the EEL problem, said Ellen Lord, the Pentagon\u2019s undersecretary for acquisition and sustainment.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThe department has increased the RFI [ready for issue] rate at Hill Air Force Base, Luke AFB, and Marine Corps Air Station Yuma from 43 percent in February, to exceeding the RFI threshold metric rate of 70 percent in every month since April, achieving a high of 83 percent in June,\u201d she said in testimony delivered to the committee.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Action requests made to Lockheed to resolve EEL issues have also sharply decreased, from more than 1,100 requests in March 2020 to 363 in June \u2014 lower than the threshold metric of 389, Lord said.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"3000\" height=\"2081\" src=\"\/wp-content\/uploads\/2026\/08\/AUSA_ellenlord03.jpg.jpg\" alt=\"\" class=\"wp-image-59983\" srcset=\"https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/AUSA_ellenlord03.jpg.jpg 3000w, https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/AUSA_ellenlord03.jpg.jpg?resize=300,208 300w, https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/AUSA_ellenlord03.jpg.jpg?resize=768,533 768w, https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/AUSA_ellenlord03.jpg.jpg?resize=1024,710 1024w, https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/AUSA_ellenlord03.jpg.jpg?resize=1536,1065 1536w, https:\/\/one.sightlinemg.com\/wp-content\/uploads\/2026\/08\/AUSA_ellenlord03.jpg.jpg?resize=2048,1421 2048w\" sizes=\"auto, (max-width: 3000px) 100vw, 3000px\" \/><figcaption class=\"wp-element-caption\">Ellen Lord, undersecretary of defense for acquisition, technology and logistics, speaks during the Association of the United States Army&#8217;s annual meeting in Washington on Oct. 11. (Mike Morones\/Staff)<\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThe F-35 JPO is also working to negotiate more comprehensive contract terms in future sustainment contracts to ensure that the contract has defined EEL and RFI metrics to measure performance,\u201d she said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Much of the improvement that has occurred since 2019 has been due to reforms put in place by a team made up of government and industry stakeholders, said one defense official, who spoke to Defense News on condition of anonymity.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Of the 65,000 unique parts on the F-35, only about 1,000 have EELs \u2014 usually, parts that can be repaired, the official said. All F-35 parts that have an EEL also have a bar code associated with a specific part number, a serial number and a \u201ccage code\u201d that indicates the supplier, as some parts are manufactured by multiple companies.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">One of the biggest problems related to EELs occurred when a military base accepted a new spare part. Typically, Lockheed sends each part with an \u201cadvance shipping notice,\u201d a set of paperwork that includes information about the part that can be plugged into the F-35\u2032s IT backbone \u2014 <a href=\"https:\/\/www.defensenews.com\/air\/2019\/02\/27\/how-the-us-air-forces-kessel-run-team-plans-to-solve-one-of-the-f-35-programs-biggest-headaches\/\" target=_blank>the Autonomic Logistics Information System<\/a>, also developed by Lockheed \u2014 to process the part and bring up the EEL information.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">However, if that advance shipping notice doesn\u2019t arrive, contains incorrect information or doesn\u2019t match with the EEL information, what should be a \u201csix- to eight-step [process]\u201d turns into a \u201c66-step [process],\u201d the defense official said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In February, the team implemented a number of software fixes for ALIS that would help decrease the number of EEL problems. It also made improvements to the advance shipping notices to ensure that parts arrive properly labeled and with the correct information, the official said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That month, the team also decided to cut down the number of parts that are associated with EEL records, reducing data-entry requirements. It plans to remove the EEL requirement for 44 percent of air vehicle parts that currently are tracked with electronic logs; and by March 2021, those parts will have gone through the process of having their EELs removed.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The defense official said the program will continue to use EELs for parts that are critical to safety or have a limited life span, but that the program was gathering life cycle data for many parts where that information historically hasn\u2019t been tracked in legacy fighter programs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cI think when you have the ability to start collecting all kinds of data electronically, maybe we were too aggressive on how many parts we assigned EELs to,\u201d the official said.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Pentagon wants financial compensation for F-35 parts that are not ready to install upon delivery.<\/p>\n","protected":false},"author":7,"featured_media":75993,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_yoast_wpseo_meta-robots-noindex":"","_yoast_wpseo_meta-robots-nofollow":"","_yoast_wpseo_canonical":"","_acf":"","_yoast_wpseo_primary_category":7,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","_smg_distribution_targets":[]},"categories":[7,8,160,12,36,19],"tags":[],"coauthors":[3384],"class_list":["post-52133","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-air","category-congress","category-daily-news-roundup","category-industry","category-newsletters","category-pentagon"],"acf":{"subheadline":"","legacy_arc_id":"4TDKNK2OJNCELMCX2KF4AUNF6E","arc_canonical_url":"\/air\/2020\/07\/22\/lawmakers-put-lockheed-under-pressure-to-pay-back-pentagon-for-f-35-parts-problems\/","remove_feature_photo":false,"is_sponsored":false,"subtype":"","redirect_url":"","disable_inline_ads":false,"native_logo_pretext":"Presented By:"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.0 (Yoast SEO v28.1) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Lawmakers pressure Lockheed to pay back Pentagon for F-35 parts problems - Defense News<\/title>\n<meta name=\"description\" content=\"The Pentagon wants financial compensation for F-35 parts that are not ready to install upon delivery.\" \/>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Lawmakers pressure Lockheed to pay back Pentagon for F-35 parts problems\" \/>\n<meta property=\"og:description\" content=\"The Pentagon wants financial compensation for F-35 parts that are not ready to install upon delivery.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/one.sightlinemg.com\/defensenews\/air\/2020\/07\/22\/lawmakers-put-lockheed-under-pressure-to-pay-back-pentagon-for-f-35-parts-problems\/\" \/>\n<meta property=\"og:site_name\" content=\"Defense News\" \/>\n<meta property=\"article:published_time\" content=\"2020-07-22T18:54:59+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2026-08-07T23:55:35+00:00\" \/>\n<meta name=\"author\" content=\"Valerie Insinna\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Valerie Insinna\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"7 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\n\t    \"@context\": \"https:\\\/\\\/schema.org\",\n\t    \"@graph\": [\n\t        {\n\t            \"@type\": \"Article\",\n\t            \"@id\": 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