Tag: f-35 (Page 2 of 2)

Airbus, Boeing May Pull Out of Canada Fighter Jet Race

July 8, 2019 / WIL BALDWIN

OTTAWA (Reuters) – Airbus SE <AIR.PA> and Boeing Co <BA.N> may pull out of a bidding process to supply Canada with new fighter jets because they say the contest is unfairly tilted towards Lockheed Martin Corp <LMT.N>, two sources with direct knowledge of the situation said on Monday.

The three companies competing with Lockheed Martin’s F-35 jet have already complained about the way the contest is being run, and expressed concern some of the specifications clearly favour the U.S. firm, industry sources have said in recent weeks.

Next week the government is due to release the so-called request for proposals – the final list of requirements – for the 88 new planes it wants to buy. The contract is worth between C$15 billion (£9 billion) and C$19 billion and the planes are due to be delivered between 2025 and the early 2030s.

Boeing and Airbus have now formally written to Ottawa expressing concerns about the current requirements, said two sources familiar with the matter who declined to be identified given the sensitivity of the situation. The fourth bidder is Sweden’s Saab AB <SAABb.ST>.

Pat Finn, the defence ministry’s top official in charge of procurement, confirmed one of the four companies had sent a formal letter but gave no details. The final request for proposals is due out on July 17 and modifications are still being considered, he said.

“We continue to engage all four of them,” he said in a telephone interview. “We have had some comments (such as) ‘If changes are not made in such a place then we would frankly consider possibly not bidding.'”

“We are looking at those very seriously. I can’t say that we will make every change, but as far as we know we continue to have four bidders in the race.”

Airbus declined to comment. Boeing did not respond to a request for comment.

Canada has been trying unsuccessfully for almost a decade to buy replacements for its ageing F-18 fighters. In May, Ottawa changed the rules to allow Lockheed Martin to submit a bid, prompting Boeing to take the unusual step of announcing publicly it was surprised.

“Anyone who is not Lockheed Martin has expressed a very strong view,” said one of the sources. “We have been pretty clear with the government that this is not a request for proposals that lends to our participation.”

At least one firm has expressed unhappiness that the requirements emphasize the ability to carry out first strikes on targets abroad, a strength of the F-35, said the sources.

The government of Prime Minister Justin Trudeau insists the competition is not rigged. Finn said the defence ministry also had made changes to the requirements at the request of Boeing, Airbus and Saab.

Canada is part of the international consortium that developed the F-35. The former Conservative administration said in 2010 it would buy 65 of the jets but later scrapped the decision, triggering years of delays.

Trudeau came to power in 2015 vowing not to buy the F-35 on the grounds that it was too costly, but Ottawa has since softened its line.

(Reporting by David Ljunggren in Ottawa; Editing by Matthew Lewis)

FILE PHOTO: A real-size mock of F-35 fighter jet is displayed at Japan International Aerospace Exhibition in Tokyo

U.S. Arms Makers See Booming European Demand

June 23, 2019 / WIL BALDWIN

53rd International Paris Air Show at Le Bourget Airport

PARIS (Reuters) – U.S. arms makers say European demand for fighter jets, missile defenses and other weapons is growing fast amid heightened concerns about Russia and Iran.

The U.S. government sent a group of unusually high-ranking officials including Commerce Secretary Wilbur Ross to the Paris Airshow this year, where nearly 400 U.S. companies were showcasing equipment as the United States and Iran neared open confrontation in the Persian Gulf.

Lockheed Martin, Boeing and other top weapons makers said they had seen accelerating demand for U.S. weapons at the biennial air show despite escalating trade tensions between the United States and Europe.

“Two Paris air shows ago, there weren’t a lot of orders,” said Rick Edwards, who heads Lockheed’s international division. “Now … our fastest growth market for Lockheed Martin in the world is Europe.”

Many European nations have increased military spending since Russia’s annexation of the Crimea region of Ukraine in 2014, bolstering missile defenses and upgrading or replacing ageing fighter jet fleets. NATO members agreed in 2014 to move toward spending 2% of gross domestic product on defence.

Eric Fanning, chief executive of the Aerospace Industries Association, said the NATO pledge and European concerns about Russia were fueling demand. “I do think it reflects the increasing provocations of Russia,” he said.

Industry executives and government officials say growing concern about Iran’s missile development program is another key factor. Tehran’s downing of a U.S. drone came late in the air show, but executives said it would support further demand.

“Iran is our best business development partner. Every time they do something like this, it heightens awareness of the threat,” said one senior defence industry executive, who asked not to be named.

Edwards said Lockheed’s F-35 stealth fighter, selected by Belgium, is poised to win another new order from Poland, while Bulgaria, Slovakia and Romania are also working to replace Soviet-era equipment.

Edwards and other executives say they see no impact from the ongoing trade disputes between U.S. President Donald Trump and the European Union.

U.S. Army Lieutenant General Charles Hooper, director of the Pentagon’s Defense Security Cooperation Agency (DSCA), said Europe accounted for nearly a quarter of the $55.7 billion in foreign arms sales his agency handled in fiscal 2018.

Hooper said the U.S. government was making concerted efforts to speed arms sales approvals and boost sales to help arm allies with U.S. weapons.

Ralph Acaba, president of Raytheon Co’s’s Integrated Defense Systems business, said the company was boosting automation and working to deliver the Patriot missile system and other weapons in half the five-year period previously typical.

“Europe is really big for us now, and that’s a big change in just the last few years and even the last 18 months,” he said.

In addition to wooing new Patriot customers, Raytheon is upgrading existing systems for customers like Germany, which is likely to finalize a contract worth potentially hundreds of millions of dollars to the company in coming months.

Thomas Breckenridge, head of international sales for Boeing’s strike, surveillance and mobility programs, is eyeing contracts wins for Boeing’s F/A-18 Super Hornet fighter jets in Germany, Switzerland and Finland.

“There’s a huge appetite in Europe for defence as a whole,” he said.

(Reporting by Andrea Shalal; Editing by Jan Harvey)

Pentagon Gets 8.8% Discount in $34 billion F-35 Jet Deal

June 10, 2019 / WIL BALDWIN

WASHINGTON (Reuters) – The U.S. Department of Defense has a “handshake” agreement with Lockheed Martin Co to cut 8.8 percent from the price of its latest order of F-35A fighter jet, shaving a year from the time frame in which each aircraft will cost less than $80 million, a Pentagon official said on Monday.

The Pentagon said over three years the agreement will be worth $34 billion for 478 F-35 fighter jets. It is preliminary and a final deal is expected to be sealed in August for the 12th batch of jets, one of the most expensive aircraft ever produced.

The preliminary agreement details the first year, and lays out agreed upon options for two additional years. The options are there because official purchases cannot be made until the U.S. Congress approves an annual budget for those years.

This year’s agreement will lower the cost of each F-35A, the most common version of the aircraft, to $81.35 million, Under Secretary of Defense Ellen Lord said, down from $89.2 million under a deal inked in August 2018.

Under the options covering the second and third years of the purchase, the price of each jet will drop below $80 million, Lord said. In those later years production would be around 160 jets per year.

The F-35 program has long aimed at growing the fleet to more than 3,000 jets and bringing the unit price of the F-35A below $80 million through efficiencies gained by ordering larger quantifies.

“I am proud to state that this agreement has achieved an estimated 8.8% savings from Lot 11 to Lot 12 F-35A’s, and an estimated average of 15%” reduction across all variants from Lot 11 to Lot 14, Lord said in the statement. That savings exceeded expectations in a RAND Corp study.

“The unit price for all three F-35 variants was reduced and the agreement will include an F-35A unit cost below $80 million in Lot 13, exceeding the Pentagon and Lockheed Martin’s long-standing cost reduction commitment earlier than planned,” the Lockheed Martin F-35 program general manager Greg Ulmer said in a statement.

While being a major part of Lockheed’s revenue, the F-35 has recently been holding competitions to find less expensive subcontractors to help control costs.

The new pricing could encourage more foreign customers to join the F-35 program. Lockheed executives have said that any country with an F-16 jet, the predecessor to the F-35, is a potential customer. This could put the market size at about 4000 jets, Lockheed CEO Marillyn Hewson recently told an investor conference.

Vice Admiral Mathias Winter, the head of the Pentagon’s F-35 office, has testified to Congress, that “future potential foreign military sales customers include Singapore, Greece, Romania, Spain and Poland.”

Foreign military sales like those of the F-35 are considered government-to-government deals where the Pentagon acts as an intermediary between the defense contractor and a foreign government.

Other U.S. allies have been eyeing a purchase of the stealthy jet including Finland, Switzerland and the United Arab Emirates.

(Reporting by Mike Stone in Washington; Editing by Bill Rigby and David Gregorio)

FILE PHOTO: A Lockheed Martin F-35A Lightning II aircraft takes part in flying display during the 52nd Paris Air Show at Le Bourget Airport near Paris

Turkey Says No Delays in Delivery of Russian S-400’s

May 31, 2019 / WIL BALDWIN

ANKARA, May 31 (Reuters) – The delivery schedule for Russia’s S-400 missile defence systems to Turkey is continuing as planned, Turkish Foreign Ministry Spokesman Hami Aksoy said on Friday, dismissing reports of delay.

The U.S. and Turkey have been at odds over Ankara’s decision to purchase the S-400’s, which Washington says are not compatible with NATO systems and poses a threat to the F-35 stealth fighter jets. Ankara has proposed to form a working group to assess the U.S. concerns, but has not received a response yet.

On Monday, broadcaster Haberturk quoted Turkish Defence Minister Hulusi Akar as saying that the delivery of the S-400’s may not happen in June, when Turkey previously said the missiles were due to arrive, but added the agreement was a done deal.

“Reports in some media outlets about Turkey evaluating delaying the S-400 procurement upon the request of the United States do not reflect the truth,” Aksoy said in a statement, adding that Ankara’s offer for a joint working group with Washington was still valid.

(Reporting by Tuvan Gumrukcu and Ece Toksabay)

Lockheed Martin Raises 2019 Profit Forecast, Shares Jump

April 23, 2019 / WIL BALDWIN

FILE PHOTO: Lockheed Martin is seen at Euronaval, the world naval defence exhibition in Le Bourget near Paris, France, October 23, 2018. REUTERS/Benoit Tessier/File Photo

(Reuters) – Lockheed Martin Corp reported a better-than-expected 47 percent jump in quarterly profit on Tuesday and raised its annual profit forecast, helped by strong demand for its missiles and fighter jets, sending its shares up more than 5 percent in pre-market trading.

U.S. weapons makers have been expected to benefit from stronger global demand for fighter jets and munitions and higher U.S. defence budgets in fiscal 2020 as they announce first quarter earnings this week.

Lockheed’s Missiles and Fire Control business, which makes missile defences like the Terminal High Altitude Area Defence (THAAD), was one of its best-performing units.

On April 1, the unit was awarded a THAAD interceptor missile contract worth $2.4 billion, some of which are slated to be delivered to Saudi Arabia, which could boost earnings for the current quarter.

Overall, the Bethesda, Maryland-based company said its earnings rose to $1.70 billion, or $5.99 per share, in the first quarter ended March 31, from $1.16 billion, or $4.02 per share, a year earlier. That was partly helped by a $75 million dollar boost from additional tax deductions on foreign military sales.

Excluding that one-time gain, Lockheed reported $5.73 per share profit, well ahead of the $4.34 per share that Wall Street had expected, on average, according to IBES data from Refinitiv.

Lockheed’s overall net sales for the quarter rose 23 percent to $14.34 billion. The company’s sales backlog grew to $133.5 billion, up 3 billion over the quarter.

Operating margins at the aeronautics division, Lockheed’s biggest, fell to 10.5 percent in the first quarter from 10.8 percent a year earlier, but sales were up 27 percent to $5.5 billion on demand for the F-35 jet and some classified contracts.

The United States is considering expanding sales of Lockheed-made F-35 fighter jets to five new nations including Romania, Greece and Poland as European allies bulk up their defences in the face of a strengthening Russia, a Pentagon official told Congress in early April.

(Reporting by Mike Stone in Washington D.C. and Sanjana Shivdas in Bengaluru; Editing by Shinjini Ganguli and Bill Rigby)

Boeing Unveils Unmanned Combat Jet

February 26, 2019 / WIL BALDWIN

AVALON, Australia (Reuters) – Boeing Co on Wednesday unveiled an unmanned, fighter-like jet developed in Australia and designed to fly alongside crewed aircraft in combat for a fraction of the cost.

The U.S. manufacturer hopes to sell the multi-role aircraft, which is 38 feet long (11.6 metres) and has a 2,000 nautical mile (3,704 kilometre) range, to customers around the world, modifying it as requested.

The prototype is Australia’s first domestically developed combat aircraft since World War II and Boeing’s biggest investment in unmanned systems outside the United States, although the company declined to specify the dollar amount.

The Australian government is investing A$40 million ($28.75 million) in the prototype programme due to its “enormous capability for exports,” Minister for Defence Christopher Pyne told reporters at the Australian International Airshow.

Defence contractors are investing increasingly in autonomous technology as militaries around the world look for a cheaper and safer way to maximise their resources.

Boeing rivals like Lockheed Martin Corp and Kratos Defence and Security Solutions Inc are also investing in such aircraft.

Four to six of the new aircraft, called the Boeing Airpower Teaming System, can fly alongside a F/A-18E/F Super Hornet, said Shane Arnott, director of Boeing research and prototype arm Phantom Works International.

“To bring that extra component and the advantage of unmanned capability, you can accept a higher level of risk,” he said. “It is better for one of these to take a hit than for a manned platform.”

The Mitchell Institute for Aerospace Studies in the United States said last year that the U.S. Air Force should explore pairing crewed and uncrewed aircraft to expand its fleet and complement a limited number of “exquisite, expensive, but highly potent fifth-generation aircraft” like the F-35.

“Human performance factors are a major driver behind current aerial combat practices,” the policy paper said. “Humans can only pull a certain number of G’s, fly for a certain number of hours, or process a certain amount of information at a given time.”

MULTI-MISSION CAPABILITIES

In addition to performing like a fighter jet, other roles for the Boeing system include electronic warfare, intelligence, surveillance and reconnaissance alongside aircraft like the P-8 Poseidon and E-7 Wedgetail, said Kristin Robertson, vice president and general manager of Boeing Autonomous Systems.

“It is operationally very flexible, modular, multi-mission,” she said. “It is a very disruptive price point. Fighter-like capability at a fraction of the cost.”

Robertson declined to comment on the cost, saying that it would depend on the configuration chosen by individual customers.

The jet is powered by a derivative of a commercially available engine, uses standard runways for take-off and landing, and can be modified for carrier operations at sea, Robertson said. She declined to specify whether it could reach supersonic speeds, common for modern fighter aircraft.

Its first flight is expected in 2020, with Boeing and the Australian government producing a concept demonstrator to pave the way for full production.

“I would say we are some years away from exports, we are probably years away from it being in operation here in Australia,” Pyne said. “It is designed to be a cheaper platform, a shield if you like around the more expensive platforms, to protect our servicemen and women who might be on a Poseidon or a Wedgetail or a F-35A.”

Australia, a staunch U.S. ally, is home to Boeing’s largest footprint outside the United States and has vast airspace with relatively low traffic for flight testing.

The Boeing Airpower Teaming System will be manufactured in Australia, but production lines could be set up in other countries depending on sales, Arnott said.

The United States, which has the world’s biggest military budget, would be among the natural customers for the product.

The U.S. Air Force 2030 project foresees the Lockheed Martin F-35A Joint Strike Fighter working together with stealthy combat drones, called the “Loyal Wingman” concept, said Derrick Maple, principal analyst for unmanned systems at IHS Markit.

“The U.S. has more specific plans for the wingman concept, but Western Europe will likely develop their requirements in parallel, to abate the capabilities of China and the Russian Federation and other potential threats,” he said.

Robertson declined to name potential customers and would not comment on potential stealth properties, but said the aircraft had the potential to sell globally.

“We didn’t design this as a point solution but a very flexible solution that we could outfit with payloads, sensors, different mission sets to complement whatever their fleet is,” she said. “Don’t think of it as a specific product that is tailored to do only one mission.”

($1 = 1.3914 Australian dollars)

(Reporting by Jamie Freed; additional reporting by Gerry Doyle; editing by Gerry Doyle)

Lockheed Martin Lands $22.7 Billion 255-Jet Fighter Order

November 19, 2018 / WIL BALDWIN

Let the shareholders rejoice: Lockheed Martin‘s (NYSE: LMT) F-35 Lightning II fighter jet contracts are getting bigger — and bigger.

In September, Reuters reported on a Pentagon deal to buy what it called at the time “the biggest batch yet” of Lockheed Martin’s joint strike fighter – 141 fighter jets valued at $11.5 billion. To win such a big order, Lockheed lowered its average F-35 cost to $81.6 million. With engine and other incidental costs factored in, flyaway costs were a bit higher. Lockheed’s F-35B variant flyaway cost $115.5 million, its F-35C cost $107.7 million, and the F-35A ended up at $89 million. Still, as Lockheed noted at the time, this contract offered the “lowest per-aircraft price in program history,” which undoubtedly helped Lockheed seal the deal.

Big as that sale was, however, the contract Lockheed just won easily eclipses it.

Click the link below for the full story!

Lockheed Martin Lands 255-Jet Fighter Order

Image from lockheedmartin.com

Are Supersonic Flights Moving Closer to a Comeback?

May 29, 2018 / WIL BALDWIN

The dream of traveling from coast to coast or across the ocean in a matter of hours is a real possibility, with the Federal Aviation Administration beginning work on updated regulations to accommodate a new generation of supersonic aircraft. The changes would be great news for passengers, while creating both challenges and new opportunities for aerospace giants like Lockheed Martin (NYSE: LMT) and Boeing (NYSE: BA).

The FAA intends to issue a formal proposal on new noise guidelines by December, according to a post on the White House’s Office of Information and Regulatory Affairs website. The new rules would allow for testing of new supersonic technologies that are designed to not generate a disruptive sonic boom, and pave the way for eventual approval of the new technologies if they work as planned.

Click the link below for the full story!

Supersonic Flight Comeback

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