Lockheed Martin agreed to the deferral of a $614 million award fee on the F-35 program, announced Monday by Defense Secretary Robert Gates as part of the Fiscal 2011 budget rollout. Dan Crowley, F-35 program manager for Lockheed Martin, said Tuesday it’s fair for the government to insist on performance and added that DOD is “going toward incentive-based fees” on all contracts. If the company can keep F-35 costs down and hit its marks in flight test and production, it could get the money, Crowley said. He also noted that since the government will take a conservative approach in estimating F-35 costs, if actual costs come in lower, the services could “buy to budget” and actually buy more airplanes with the same money. One thing is for sure, though: No money is going to be added to accommodate higher costs, Crowley said.
A three-month continuing resolution that ended in December inflicted less pain on the Department of the Air Force than it had expected, as procurement and construction continue in the new year. The federal government operated under a stopgap spending measure that stretched from the beginning of the fiscal year on…