Lockheed Martin (LMT) Receives $1.27 Billion Contract For F-35 Lightning II Aircraft

Lockheed Martin Corp. has been awarded a $1.27 billion contract to deliver F-35 Lightning II aircraft, the U.S. Department of Defense announced Monday. The Marine Corps will receive six F-35B aircraft, Air Force will get three F-35As and the Navy will take the delivery of four F-35Cs.

“Work will be performed in Fort Worth, Texas [55 percent]; El Segundo, California [15 percent]; Warton, United Kingdom [10 percent]; Orlando, Florida [5 percent]; Nashua, New Hampshire [5 percent]; Baltimore, Maryland [5 percent]; and Cameri, Italy [5 percent], and is expected to be completed in December 2019,” the Pentagon said, in a statement.

In March, Gen. Christopher Bogdan said that the F-35 Joint Strike Fighter has been running four months behind schedule and will only get its combat capability package in late 2017. In a written testimony to the House Armed Services subcommittee on tactical air and land forces Wednesday, Bogdan blamed software testing issues on the newer 3F software for the most recent delays to $1.5 trillion program.

Bogdan set up what he called the “Red Team,” made up of experts from the Navy, Air Force and outside the Pentagon, to fix the problem. The Red Team began its study and will report back in about a month, Bogdan said.

The U.S. decided to build more than 2,300 F-35s over the next 40 years, replacing several aircraft programs across the military branches. However, it is taking into account increasing the number of F-15s, F-16s and F-18s as airstrikes against the Islamic State group put pressure on the resources of the Air Force.

According to a December 2015 Congressional research report, the U.S. Air Force may require to cut the amount of F-35s it buys over the next 10 years as aircraft research and procurement strain an already tight military budget. The current Air Force budget through 2020 is $72.7 billion and it is expected to cover costs of nine aircraft programs. Of that, 42 percent will be spent only on the F-35. Although it was not clear how many aircraft the Air Force will cut annually from the proposed 60, a reduction of 10 per year over the next five years would represent a saving of around $5 billion, provided the price of the aircraft remains around $100 million each, the report stated.