Lockheed eyes deal for next F-35 batch in near term
Reuters July 24, 2013, 12:09 am
Workers can be seen on the moving line and forward fuselage assembly areas for the F-35 Joint Strike Fighter at Lockheed Martin Corp's factory located in Fort Worth, Texas in this October 13, 2011 handout photo provided by Lockheed Martin. REUTERS/Lockheed Martin/Randy A. Crites/Handout
By Andrea Shalal-Esa
WASHINGTON (Reuters) - Lockheed Martin Co Chief Executive Marillyn Hewson said the company is making "good progress" in negotiations with the Pentagon about the next two batches of F-35 fighter jets and hopes to complete an agreement in the near term.
Lockheed is building three models of the F-35 for the U.S. military and eight international partner countries - Britain, Australia, Canada, Norway, Turkey, Italy, Denmark and the Netherlands. Israel and Japan have also ordered the jet.
Pentagon officials had hoped to reach agreement with Lockheed on the sixth and seventh orders of F-35 jets - deals valued at multiple billions of dollars - around mid-year, after protracted and difficult discussions on the previous order.
The total number of jets involved is 71, with 36 of the planes to be purchased in the sixth production lot, and 35 in the seventh, said Joe DellaVedova, spokesman for the Pentagon's F-35 office. He said that number includes 60 F-35s for the U.S. military, and 11 for Australia, Italy, Turkey and Britain.
"We've been very open and transparent with our data and I think the negotiations are going well," Hewson told reporters after the company reported higher-than-expected second-quarter earnings.
"We've making good progress and we hope that we'll be able to close in the near term," she said, also citing strong Pentagon and international support for the F-35 program, despite U.S. budget cuts.
DellaVedova declined to predict when an agreement could be reached. The F-35 is the Pentagon's biggest weapons program, and officials have been pushing for lower prices to ensure the program's future given mounting budget pressures and mandatory budget cuts that could cut the Pentagon's budget by $500 billion over the next decade.
The Pentagon reached agreement with Lockheed on the fifth batch of F-35s last December, agreeing to buy 32 of the advanced warplanes for $3.8 billion.
The U.S. government is negotiating separately with Pratt & Whitney, a unit of United Technologies Corp to buy engines for the sixth batch of jets.
(Reporting by Andrea Shalal-Esa; Editing by Gerald E. McCormick and Sofina Mirza-Reid)
