Scrapping Pentagon F-35 Office an Option to Cut Upkeep Costs

January 14, 2020, Bloomberg – by Anthony Capaccio

Maintenance crews prepare a Lockheed Martin Corp. F-35A jet for a training flight in Hill Air Force Base, Utah.Photographer: George Frey/Bloomberg
  • Lawmakers seeking ways to reduce $1.1 trillion cost projection
  • House Armed Services panels meet in closed session on Tuesday

House lawmakers trying to reduce the projected $1.1 trillion cost of maintaining the F-35 over 60 years are considering options including eliminating the Pentagon’s central office in charge of the fighter jet built by Lockheed Martin Corp.

Dispersing responsibility to the three military services that are getting variations of the plane is among possibilities drafted by the Defense Department that will be reviewed Tuesday in a closed-door briefing of two House Armed Services subcommittees.

The proposal to “potentially dissolve and disaggregate the F-35 Joint Program Office” is aimed at gains in “efficiency and effectiveness,” Monica Matoush, a spokeswoman for the Armed Services Committee, said in an email.

Other possibilities include prodding Lockheed Martin to give up data rights on some spare parts — so that other suppliers could be sought — and pushing for improvements in the aircraft’s flawed diagnostic system.

Matoush said the briefing, which will include Under Secretary of Defense Ellen Lord and representatives of the Government Accountability Office, will also “evaluate the merits and disadvantages” of an unsolicited proposal by Bethesda, Maryland-based Lockheed to enter into a long-term, “performance-based” logistics contract for F-35 sustainment.

If accepted — and delivered on — that could be worth billions of dollars to the company. The proposal would tie financial incentives to reducing the plane’s cost per hour of flight to $25,000 from $35,000 and maintaining 80% fleet readiness.

Lord said Tuesday at a meeting with defense reporters that she’s still undecided on the proposal’s merits. The Navy is taking the lead in gathering the data needed to thoroughly assess the plan and an official assigned to review it will present his findings Friday, Lord said.

Cost ‘Clarity’

“At this point, I don’t know whether” the Lockheed proposal “makes sense or not because I have not seen all the elements of cost” and data backing it up, she said.

Lord added that she’s seen similar “performance-based logistics” proposals “be very efficient and effective when it’s a ‘win’ for industry and a ‘win’ for the government,” but “right now we need some clarity around cost” and intellectual property issues.

Separately, Lord later told Bloomberg that the F-35’s crucial but problematic aircraft diagnostics system known as ALIS, for Autonomic Logistics Information System, has been improved to replace the current version and renamed “ODIN,” after the father of the god Thor in Norse mythology. It stands for Operational Data Integrated Network.