Lockheed Martin is developing a new procurement concept for the early F-35 Lightning IIs being bought by the programme’s non-US partners.
Called the consortium buy, the new concept will allow foreign customers to benefit from a multi-year buy long before they would normally be able to. Under present plans, these low-rate initial production (LRIP) JSF aircraft will cost considerably more than later aircraft built after the full rate production decision.
The USAF can only commit to multi-year procurement after ‘Milestone C’, when LRIP gives way to full-rate production (FRP). Before that it is constrained to yearly buys.
“Partners are not similarly constrained,” says George Standridge, vice president for F-35 business development and customer engagement. This means they could buy their 368 LRIP6 and LRIP7 aircraft in what would amount to a multi-year purchase. “The consortium buy will benefit our partners by giving pricing stability and certainty, and will help ministers to plan their budgets, and for industry to make investment decisions.”
Lockheed Martin is still developing the concept, defining ground rules and conditions, and will mature the concept over the summer and autumn, delivering a preliminary proposal in the first quarter of next year.
Standridge believes it’s far too early to talk about prices, though the gulf between LRIP and FRP unit flyaway costs for the USAF is considerable. The USAF Committee Staff Procurement Backup Book (FY 2009 budget estimates) gives an LRIP6 cost of $91.223m, with a post-2013 cost of just $79.973m.
In return, partners would commit to an upfront purchase of a defined number of aircraft, effectively locking them into the programme, and Lockheed would gain from being able to stabilise its production planning and its production supply chain.
Source: Flight International
