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Negotiations continue between Lockheed and the Pentagon

Negotiations between the Pentagon and Lockheed Martin started last year to iron out all the details for the purchase of 32 F-35 fighters. The reason negotiations on pricing have dragged on for so long is due to the Pentagon's use of new pricing data according to Defense News. DOD officials are now using what's being called a "should-cost" estimate for the purchase of the F-35 fighters based on data from the previous four F-35 purchases.
 
Undersecretary of Defense for Acquisition Technology and Logistics, Frank Kendall, says that the Pentagon's move to "should-cost" estimates were used to develop a "bottoms-up cost estimate based on that previous history."
 
“We started negotiations on the government side with a very well-documented set of costs, called the should-cost, and then we were able to compare that to the bid that we received, item-by-item, line-by-line,” Kendall said during a July 16 meeting with a small group of reporters in his Pentagon office. “Going through and trying to resolve the differences has been the process that has taken so long.”
 
Kendall also notes that once negotiations conclude, "We’ll be in a very good place to go ahead and negotiate for future lots."
 

A group of Lockheed F-35B Lightning II fighters [Source: Lockheed Martin]
 
The Pentagon has been working hard to put pricing pressure on Lockheed Martin for F-35 purchases despite reducing the number of aircraft required over the next five years by 179 units. Typically, every time purchase plans are reduced by any partner nation, pricing for the F-35 increases.
 
Kendall also believes that sequestration, or mandatory spending cuts that will go into effect in January, will not affect every F-35 acquisition contract. Sequestration only applies to funding that is not yet obligated according to Kendall.

The Pentagon is fighting for every penny it can save on the F-35 fighters as the overall lifetime cost of the F-35 program continues to soar.

Source: Defense News



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By Ringold on 7/18/2012 11:59:18 AM , Rating: 2
I've made the comment before, but... Maybe I'm missing some form of grand military strategy, but if I was running the show, I'd tear up all contracts to buy F35s and F22s. Completely.

I'd use the F22s already delivered and existing aircraft and, with the savings from killing those boondoggles, triple-down on drones, which appear to be the future. In the process, I'd support several new entrants to the market, to try to avoid the Boeing/LockMart apparent duopoloy. Like COTS at NASA, I'd try to encourage some new innovators.

In the end, unless I'm missing something, the military would barely miss a beat and would have the most advanced craft in the air at much lower cost. Even if they weren't the most advanced, at least they'd be a fraction the cost and would be much more disposable since the loss of one wouldn't mean the loss of a highly trained pilot.


By Bad-Karma on 7/18/2012 10:42:57 PM , Rating: 2
quote:
Maybe I'm missing some form of grand military strategy, but if I was running the show,


Apparently you are, and with blanket concepts like that it's a good thing your not. If the enemy every found a way to defeat your "mass drone military" then one domino takes out the whole force. Never put all your eggs in one basket.


"It seems as though my state-funded math degree has failed me. Let the lashings commence." -- DailyTech Editor-in-Chief Kristopher Kubicki














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