Posted: Wednesday, 03 March 2010 9:31AM
Pentagon Slips F-35 Schedule, Reviews Costs
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WASHINGTON (Reuters) - U.S. Air Force Secretary Michael Donley on Tuesday underscored the Pentagon's commitment to Lockheed Martin Corp's F-35 fighter program, saying it would likely survive a mandatory review triggered by cost overruns.
Pentagon acquisition chief Ashton Carter last week signed a memorandum implementing restructuring steps outlined by top defense officials.
The February 24 memo, first reported by The Hill newspaper, said the Pentagon was extending development of the program by 13 months; adding one carrier variant plane for extra testing; and moving a decision about full-rate production to November 2015, when initial testing is complete.
Carter's memo also added $2.8 billion to the development cost of the F-35, based on more conservative estimates from an independent estimating team. It said the Pentagon would withhold $614 million in award fees from Lockheed and its F-35 partners, Northrop Grumman Corp and BAE Systems.
The Pentagon was still working through details before notifying Congress about a probable breach of cost thresholds that would trigger a review that could lead to the program's cancellation, Donley told defense reporters.
Donley said no "showstoppers" had emerged that could lead to cancellation, and no alternatives to the fighter.
Donley said if Lockheed drives down costs and improves performance, the Pentagon could add back some of the 122 fighter jets that were removed from the five-year budget plan.
"Our goal from the very beginning, having accepted that slightly more pessimistic baseline, was to pull it back and to not make that a self-fulfilling prophecy," he said. "We want to hold the contractor's feet to the fire, we want to incentivize them to make good on the promises that they had made earlier and to deliver on schedule," he said.
Carter's memo said the department would request long lead procurement funding for 48 fighter planes in fiscal 2011.
Donley said the delay in F-35 development would push back the projected date to start operating the new fighters until late 2015 from 2013. But he said progress by Lockheed could allow officials to speed up the program.
Donley said he was not aware of further management changes in the F-35 program "on the government side" after last month's decision to remove the program manager, Marine Corps Major General David Heinz. He said it was unclear when Heinz's replacement would be named, but noted the job required Senate confirmation since it was now a three-star position.
Carter, the Pentagon officials running the program, the chief executives of the prime contractors working on the F-35 programs, and the acquisition chiefs for the eight international partner countries, will meet at Lockheed's Fort Worth, Texas plant for a two-day review starting on Wednesday.
Pentagon officials are due to provide detailed briefings on the F-35 restructuring at the annual "CEOs conference".
Donley said the Air Force was considering funding a service life extension program for the Lockheed F-16 fighter planes, given the expected delays in fielding of the F-35, but no final decisions had been made.
It was not yet clear if any funding for such a program would be added to the fiscal 2011 budget or later budget years, he said.
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Story Copyright 2010, Reuters
Photo Copyright 2010, Getty Images
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