Lockheed Martin gets $1B F-35 sustainment contract

WASHINGTON — Lockheed Martin raked in a $1 billion contract Tuesday for F-35 sustainment and logistics support for U.S. military and international customers.

According to the contract announcement, Lockheed will provide sustainment services including ground maintenance, depot activation, supply chain management, and initial pilot and maintainer training. It also covers work on the F-35's logistics platform, the Autonomic Logistics Information System, which guides maintainers through repair processes and helps manage spare parts.

The company "is honored by the trust and confidence the [Department of Defense] is placing in Lockheed Martin to support the maintenance and operations of the F-35 fleet across the world as the fleet builds up on an almost daily basis," a spokesperson said in an emailed statement.

Last July, Lockheed CEO Marillyn Hewson announced a new sustainment cost-reduction initiative targeted at cutting at least $1 billion from fiscal years 2018 to 2022. Over that five-year period, Lockheed, together with F-35 subcontractors Northrop Grumman and BAE Systems, would invest $250 million in projects that could decrease operation and maintenance costs over the long haul, she said then.

The jury is still out on the finalized contract value of the 10th batch of F-35s, announced in January by White House Press Secretary Sean Spicer. From Lot 9 to Lot 10, unit prices decreased about 7.5 percent and the conventional F-35 model dropped to below $100 million a copy for the first time. Although final numbers have not been released, the Pentagon estimates the contract — which includes 90 F-35 airframes but no engines, which are procured through a separate deal — will be worth about $8.2 billion.

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