Pentagon, Lockheed Strike $85B F-35 Deal

The Pentagon and Lockheed Martin have reached an initial deal to produce 850 F-35 jets, with plans to buy at least 850 additional jets in what would be the biggest contract in the programme’s quarter-century history. The contract includes procurement of initial spare parts and modification kits, plus sustainment of the global F-35 fleet over 10 years.

The F-35 jet costs about US$100 million each, making the total value of the contract substantial. Lockheed Martin will self-fund at least US$7 billion in initiatives that support the programme.

The framework calls for producing 156 jets per year over a decade, which is intended to stabilise prices, ensure adequate spare parts supplies and improve reliability in the face of emerging threats like artificial intelligence and drones. This approach provides greater certainty for Lockheed Martin, according to the company's president and CEO Jim Taiclet.

Undersecretary for Acquisition Michael Duffey said in a statement that the agreement with Lockheed Martin proves the US government’s transformative approach to F-35 production. The US approved similar deals to increase production of critical munitions such as air defence interceptors in 2026.

## Why it matters The renewed award is a vote of confidence in the F-35, after the aircraft became a prime target of criticism. Many US fourth-generation jets, like the F-15s and F-16s, have been in service for decades and will be retired before the next generation F-47 and F/A-XX aircraft are in production. The F-35 will remain a major part of the US arsenal for many years, and this contract signals the US government's commitment to the programme.

## What happens next The contract is not yet final, but the initial deal marks a significant step forward in the production of the F-35jets. With the framework in place, Lockheed Martin can move forward with production, and the US government can ensure the sustainability of the global F-35 fleet over the next decade.