DoD wants to see more savings in next JSF order

DoD wants to see more savings in next JSF order

Air Force Times

By Marcus Weisgerber - Staff writer
Posted : Tuesday Apr 12, 2011 18:08:14 EDT

The Pentagon is preparing to negotiate its next order of F-35 Joint Strike Fighter aircraft with Lockheed Martin, this time with a concerted effort to crank down the jet’s price, according to the Air Force’s top acquisition official.
The Defense Department will “focus on continuing to build the inertia on the program and production side and to continue to get the right price of the aircraft for both the Air Force and the Navy customers,” David Van Buren, the Air Force’s acting acquisition executive, said during an interview Tuesday at the Pentagon.
To that end, the Air Force has listed “a more affordable JSF” as its top acquisition priority, replacing the long-standing top priority of purchasing a new tanker. The service awarded the tanker contract to Boeing in February. Getting that program off and running is now the No. 2 priority.
The so-called low-rate initial production lot-5 (LRIP 5) includes the next batch of JSF aircraft requested in 2011. DoD’s 2011 budget proposal requested 43 F-35 aircraft, however, Congress has indicated that it would not fund more than 32 jets. This factor prompted the Pentagon to request 32 JSF aircraft in 2012, according to DoD budget documents. Lawmakers are expected to vote on the 2011 budget this week.
Last year, the Pentagon converted its F-35 contract with Lockheed from cost plus incentive fee to fixed price. Those negotiations took about five months before a deal was reached in September.
“My sense is that it would be a shorter period of time than [LRIP] 4, because [LRIP] 4 was a conversion of the proposal that came in as a [cost plus incentive fee contract] that we converted to a fixed-price-type contract, basically, at the table as we evolved through that negotiation process,” Van Buren said.
While a proposal for the multiservice jets has not been written, officials are looking at the upcoming negotiations as a continuation of the last round of talks.
“I think that is just a building block of what we did from LRIP 4, where we converted to a fixed-price-type contract, which I think was very important,” Van Buren said. “This will just be a continuation of that endeavor.”
Pentagon officials have yet to receive a finalized proposal for the LRIP 5 jets, but expect the negotiations to commence this year.
Over the years, the F-35 has encountered numerous setback and issues that have prompted cost projections to soar. Last year, DoD warned that the program, which includes more than 2,400 U.S. jets and an expected 700-plus international order, could top $380 billion.
Industry and defense officials have committed to lowering that price and last year’s signing of a fixed-price contract with Lockheed was considered an initial step. The Pentagon’s 2012 budget proposal reflects a restructuring of JSF development and production.
In recent months, the JSF program has exceeded flight testing goals, with a few speed bumps along the way.

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