Lockheed Martin to drive down cost of F-35 fighter jet program

The alternative to Lockheed Martin’s F-35 fighter aircraft is Boeing’s F-18, an older generation aircraft which lacks the distinctive stealth capabilities of the F-35.

Marillyn Hewson, Lockheed Martin’s CEO has told U.S. President-elect, Donald Trump, that she is committed to driving down the cost of the F-35 fighter jet.

“Based on the tremendous cost and cost overruns of the Lockheed Martin F-35, I have asked Boeing to price-out a comparable F-18 Super Hornet!” had tweeted Trump.

Trump tweet’s had suggested that Lockheed Martin’s rival Boeing could offer a cheaper alternative to its F-35 fighter aircraft.  Hewson responded to the tweet by stating that she heard his message “loud and clear” and that she was committed to driving down the cost of the program.

“I gave him my personal commitment to drive the cost down aggressively,” said Hewson in a statement.

Boeing’s F-18 alternative, an older generation aircraft, lacks the stealth capabilities of Lockheed Martin’s F-35.

As per an U.S. official, given the importance of stealth technology, it is difficult to understand what Trump is stating. The U.S. faces increasing hostilities from neer-peer countries such as China and Russia. Stealth technology is a way to counter advanced defences.

“Somebody needs to ask Donald Trump how he’s going to be able to confront China without aircraft capable of penetrating anti-access and area denial systems, including air defenses,” said the official.

Significantly, most defense analysts opine that the F-35 cannot be compared to the f-18.

“Impractical if not irrational,” said Richard Safran, a defense analyst at Buckingham Research.

“First, the F/A-18 is a carrier-based naval fighter. Certainly it could not meet the U.S. Marine Corps need for vertical lift. It would not be suitable for the Air Force either – the extra weight of a carrier fighter makes it less than ideal for the Air Force.”

“Unless the rules of physics have changed, you cannot make a non-stealthy, two-engined, carrier-based aircraft from the 1980s into a single-engine, multi-role stealthy fighter from the 2000s,” wrote analysts from Vertical Research Partners in a note.

The Pentagon did not respond to requests for comments.

Ever since Trump tweeted his thoughts on the F-35 program, Lockheed Martin’s shares have slumped nearly 6.4% and have lost nearly $5 billion market value.

“We have no idea how this plays out but believe ‘Twitter risk’ for defense companies could be a significant issue over the next four years,” wrote Cowen’s Schweizer in a note. “This is Lockheed Martin’s time in the barrel.”

Advertisements


Categories: Creativity, Geopolitics, HR & Organization, Regulations & Legal, Strategy

Tags: , , , , , , , , , , , , , , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: