Strategy Page on the latest setback to the F-35 program:
U.S. Department of Defense officials are trying to slow down production of the new F-35 fighter because testing is revealing more design problems than anticipated. If the current production schedule remains in place there is a high risk that very expensive modifications will be needed for F-35s that have entered service. The air force has already ordered 58 F-35s to be produced before all testing is completed and plans to produce 472 F-35s this way. The Department of Defense is more concerned about the additional costs than the air force, which just wants to get the aircraft into production as quickly as possible. The air force fears that the production orders will be cut even further if the F-35 does not enter service quickly.
There are more disputes between the Department of Defense and the air force. For example, the two are trying to agree on what the F-35 will cost. The air force insists that it is $65 million each, while the Department of Defense says when all costs are included it will be more like $111 million each. Another number being debated is how many F-35s will actually be produced. The air force assumes 2,443 for the air force, navy, and marines but the Department of Defense is not so sure that many will eventually be built. Total development cost is now put at $65 billion, which comes to over $25 million per aircraft if 2,443 are built. Development costs for the new U.S. F-35 fighter-bomber has grown by more than a third over the last few years. The additional development costs are accompanied by additional delays. Current estimates are that the F-35 will enter service in another 6-7 years. The Department of Defense believes production and development costs will continue to rise and that the number to be built will decline. Both trends increase the average aircraft cost. Based on past experience the higher Department of Defense estimates are more likely to be accurate.
