The key facts
- The Pentagon and Lockheed Martin concluded a 10-year framework agreement for 850 F-35 fighters; the cost was not named
- Lockheed is investing $7 billion and promises a production rate of 156 aircraft per year; the deal requires Congressional approval
- The agreement also covers spare parts, modification kits, maintenance, and international orders
Ten-year contract for 850 F-35s
The Pentagon and Lockheed Martin on Thursday announced a 10-year agreement for the production of 850 F-35 fighters, underscoring Washington's long-term commitment to the stealthy, high-tech aircraft. The parties did not disclose the cost of the agreement. It is structured as a 'framework' deal and, according to the Pentagon, is meant to 'modernize and expand' the F-35 program, but it still requires approval and funding from Congress.
Terms and expected savings
In response to the Pentagon's decade-long commitment, Lockheed Martin will fund $7 billion in projects in support of the F-35, the military department said. The company committed to producing aircraft at a rate of 156 machines per year and, according to it, expects savings of billions of dollars thanks to 'long-term pricing and industry volume discounts.' In addition to the aircraft themselves, the agreement covers an initial stockpile of spare parts, 10 years of modification kits and maintenance, as well as orders from international customers.
Pentagon's goals
'We have fundamentally changed the approach to stabilizing the American defense industrial base to produce quickly and at scale,' said senior procurement official Michael Duffey in the Pentagon's announcement. According to him, 'by aligning financial incentives with real outcomes, we are providing our military with the lethal capabilities they need to fight and win.' Lockheed said the deal, if approved, would give Washington a 'predictable, affordable and sustainable' fighter program.
Lockheed statements and context
Lockheed chief Jim Taiclet said on an investor call that the announcement 'cements the aircraft's role as the key frontline fighter of the free world for years to come.' In a separate statement, he noted that greater certainty allows for upfront investments in capacity expansion, efficiency improvements, and a more resilient supply chain. The F-35 is a joint project of the United States and a number of allies; according to Lockheed, more than 1,375 such aircraft are based worldwide, and three variants can cost more than $100 million per aircraft. American forces used the F-35 in combat during the US-Israeli war against Iran.
International interest and economic impact
Significant international interest in the aircraft is reported: last month the United States approved the sale of 48 aircraft to Saudi Arabia for $24.3 billion. Turkey, excluded from the program in 2019 after purchasing a Russian air defense system, recently expressed confidence that access to the aircraft would be restored — though Israel strongly opposes this. Lockheed said the program will support more than 315,000 jobs and generate nearly $80 billion in economic activity over the next 10 years. On Thursday, the company also reported third-quarter profit above expectations, once again benefiting from increased activity across all segments.
