Italy, Turkey Picked For F-35's European Maintenance
By GILLIAN RICH, INVESTOR'S BUSINESS DAILY
Lockheed Martin's (NYSE:LMT) F-35 jet will provide "hundreds of billions of dollars" in maintenance work worldwide in the next 50 years, according to Air Force Lt. Gen. Chris Bogdan in a Reuters report.
Italy and Turkey were selected Thursday to do maintenance in Europe. Italy will do heavy maintenance on the fighter plane in Europe, with Britain as the backup.
Turkey will deal with heavy maintenance on the F135 engines, which are made by United Technologies' (NYSE:UTX) Pratt & Whitney unit, with additional sites in Norway and the Netherlands to open in the next two to three years.
With development and productions costs totaling $400 billion, the F-35 is the most expensive weapons program ever. The Pentagon also estimates costs to operate and maintain the F-35 could reach $1 trillion during the fleet's life cycle.
But in September, the Government Accountability Office warned sustainment costs could be even higher and quoted a defense official calling the current sustainment strategy "not affordable."
The GAO also estimates that annual operational and support costs for the F-35 will be $19.9 billion (in 2012 dollars) during the fleet's peak years, 79% higher than costs for other aircraft like the F-15 and F-16.
But the overseas orders that Lockheed needs to help offset a slowdown in military spending at home have been lagging. For example, Rome originally ordered 131 jets in 2012, then cut its order to 90. And opposition in Israel is growing over the size of a second batch of F-35s due to range, payload and maneuverability concerns.