How Do They Do That?

The price of the F-35 strike fighter came down four percent in both Lot 6 and Lot 7 production. How? Lorraine Martin, Lockheed Martin’s F-35 general manager, said in an interview on Monday the company and the Pentagon “spent a lot of time in [Lot] 5 understanding costs” and “what does it really take to build the aircraft, and what are all the cost components?” Learning curve and production efficiencies are improving, there are fewer and fewer discoveries in flight test, and negotiating two lots at once also added some economy of time and cost. With these under her belt, she’s hoping that now the company and the government can “get back on that regular cadence . . . of being in sync with the acquisition- and procurement-planning process.” That means long-lead money and contracts line up. She expects to submit the company’s next lot proposal before the end of 2013, and get on contract for Lot 8 in the January-March timeframe. For Lot 5, the sequence was out of sync by 18 months; for Lot 6 and Lot 7, four months. Getting back on track “helps everyone” with cash flow, especially to the sub-tier vendors, she said. The F-35 program is now below the official government cost estimate “and we expect it will stay below,” said Martin. She spoke with the Daily Report in National Harbor, Md., at AFA’s 2013 Air and Space Conference.