F-35 fighter jet

Lockheed Martin’s fighter program encountering development delays, cost overruns

By Lee Tae-hoon

Chances are high for the government to pick the F-35 fighter jet as the mainstay of the Air Force later this year, but it is doubtful whether the new aircraft can be delivered to Korea as promised from 2016.

Seoul is expected to announce the winner of the bidding for its next-generation fighter acquisition project in October this year in line with its plan to introduce 10 advanced jets in 2016 and 2017, respectively, and the remaining 40 by 2020.

“Lockheed Martin officials recently informed us that the F-35 development and testing is progressing faster than anticipated and that they are confident of delivering fully operational fighter jets by 2016,” a senior official of the state-run Defense Acquisition Program Administration (DAPA) said Tuesday.

“But it is dubious whether their claims can be accepted as the F-35 program, which is still in the early stage of flight testing, continues to encounter development delays and cost overruns.”

Lockheed Martin, which has proposed to sell F-35s, is competing with its U.S. rival Boeing and the European Aeronautic Defense and Space Company (EADS) for the 8.29 trillion won ($7.3 billion) deal.

Another DAPA official pointed out that Korea will face great difficulties in imposing any significant penalty even if Lockheed Martin fails to deliver its latest stealth jets on time.

“Both Lockheed Martin and Boeing intend to sell their aircraft to Korea through the Foreign Military Sales program (FMS), which is often considered an unfair trade practice. It will leave little room for Seoul to punish them over delivery delays,” he said.

“Given that the FMS program is a contract based on trust between the U.S. government and another nation, no one has ever succeeded in negotiating with the Pentagon on a strict penalty for delays.”

The DAPA official said his agency plans to ask the U.S. government to pay up to 10 percent of the contract price as compensation for delivery delays, but it remains doubtful whether the Pentagon will agree to this.

“As it is unlikely for the U.S. government to comply with DAPA’s demand, it is also mulling ways to give lower marks to Lockheed Martin during the test and evaluation process later this year unless it can dispel mounting concerns over production delays,” he said.

The F-35 Joint Strike Fighter Concurrency Quick Look Review published on Nov. 29 last year concluded that U.S. defense giant Lockheed Martin will only be able to start producing a fully operational version of the F-35 in 2017.

“The program was not making sufficient progress toward meeting operational effectiveness criteria for the helmet mounted display, night vision capability, aircraft handling characteristics, and certain classified issues,” the Pentagon report said.

“The system was not on track to meet certain suitability requirements, including thermal management, the performance of the Autonomous Logistics Information System (ALIS), and aircraft material repair times.”

According to Aviation Week, Canada’s F-35 project manager said, although the country plans to purchase F-35s in 2014, and take delivery in 2016, the first aircraft will not arrive until 2019 and initial operation capability is not expected before 2020.