{"id":68902,"date":"2024-11-25T18:45:00","date_gmt":"2024-11-25T18:45:00","guid":{"rendered":"https:\/\/one.sightlinemg.com\/defensenews\/uncategorized\/2024\/11\/25\/pentagon-lockheed-reach-handshake-deal-for-next-f-35s\/"},"modified":"2026-08-08T01:16:27","modified_gmt":"2026-08-08T01:16:27","slug":"pentagon-lockheed-reach-handshake-deal-for-next-f-35s","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/defensenews\/air\/2024\/11\/25\/pentagon-lockheed-reach-handshake-deal-for-next-f-35s\/","title":{"rendered":"Pentagon, Lockheed reach handshake deal for next F-35s"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The Pentagon and Lockheed Martin have reached a handshake agreement for <a href=\"https:\/\/www.defensenews.com\/air\/2024\/10\/22\/lockheed-feels-financial-pinch-from-f-35-upgrade-contract-delays\/\" target=\"_blank\">two more lots of F-35 Joint Strike Fighters<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The initial agreement will cover production of lots 18 and 19 of the stealth fighter\u2019s air vehicle, Lockheed and the F-35 Joint Program Office said in a joint statement. The handshake deal was first reported by <a href=\"https:\/\/www.airandspaceforces.com\/lockheed-f-35-program-office-lots-18-19\/\" target=\"_blank\">Air and Space Forces Magazine<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The JPO and Lockheed said they are still negotiating the final terms of the deal and will announce how many F-35s the contract will cover and their cost when the agreement is officially signed. Lockheed Chief Financial Officer Jay Malave said in an<a href=\"https:\/\/www.defensenews.com\/air\/2024\/10\/22\/lockheed-feels-financial-pinch-from-f-35-upgrade-contract-delays\/\" target=\"_blank\"> October earnings call<\/a> that the company expects to strike a deal for lots 18 and 19 by the end of 2024.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In late 2023, the Pentagon gave Lockheed permission to start working on lots 18 and 19 and awarded the company an advance contract to start funding the production of those jets. But in the <a href=\"https:\/\/www.defensenews.com\/air\/2024\/10\/22\/lockheed-feels-financial-pinch-from-f-35-upgrade-contract-delays\/\" target=\"_blank\">October earnings call<\/a>, Lockheed said that money has run out. The company has kept working on these jets and is funding the advance production itself, to avoid supply chain disruptions from halting work.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The delay in reaching the lot 18 and 19 contract, as well as millions of dollars in withheld payments to Lockheed over incomplete upgrades, has hurt the company\u2019s bottom line. Lockheed said in October that it faced about $700 million in delayed revenue on the jet in its third quarter.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The previous F-35 contract, which covered lots 15 through 17, was struck in 2022. That deal provided up to 398 F-35s to the U.S. military, international partners and foreign military sales for $30 billion.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The JPO estimates the average cost of an F-35A across lots 15 through 17 is $82.5 million. The F-35B, which is flown by the Marine Corps and capable of short takeoff and vertical landing flight, costs $109 million on average. And the carrier-based F-35C costs an average of $102.1 million in those lots.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">While the prices of the lot 18 and 19 F-35s are unknown, they are expected to go up. Lockheed officials have said that the military\u2019s plans to reduce the number of F-35s it buys, along with the increasing complexity of the latest fighters and inflation, are likely to drive cost growth.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">F-35 contracts typically cover three lots at a time. But the 20th lot could be the first covered under a multi-year contract, so this deal will only cover lots 18 and 19.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Pentagon also awarded Lockheed an $870 million contract Nov. 22 to start procuring parts in advance that will be needed to build lot 20 aircraft, largely at its factory in Fort Worth, Texas.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Lockheed Martin has felt financial strain as early funding for the upcoming F-35 jets dried up, but kept working on them to avoid supply chain disruptions.<\/p>\n","protected":false},"author":7,"featured_media":119279,"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":[7,160,36],"tags":[],"coauthors":[3412],"class_list":["post-68902","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-air","category-daily-news-roundup","category-newsletters"],"acf":{"subheadline":"","legacy_arc_id":"GYL5SZSZFZBQZA6DKCAHNVWCNQ","arc_canonical_url":"\/air\/2024\/11\/25\/pentagon-lockheed-reach-handshake-deal-for-next-f-35s\/","remove_feature_photo":false,"is_sponsored":false,"subtype":"","redirect_url":"","disable_inline_ads":false,"native_logo_pretext":"Presented 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