Pentagon official: Lockheed should share costs of keeping program on track

Lockheed Martin should share the costs of keeping the high-priority F-35 Joint Strike Fighter (JSF) program on schedule, Ashton Carter, the Pentagon’s acquisition chief, said Monday.

“You don’t want to be in a situation where the government bears the cost of schedule slips in a program all by itself,” Carter told reporters.

“It's reasonable that risk in a program be shared — be shared equitably,” he said.

The next-generation fighter jet has been billed as a relatively low-cost way to replace a variety of fighters used by U.S. military services and forces in other countries.

But the Joint Estimating Team (JET), the Pentagon’s independent analysis cell, has projected substantial cost overruns and schedule delays for the JSF program, which is a high priority for Defense Secretary Robert Gates.

One estimate said $16 billion more is needed to avoid major problems that could set the program back two years, according to information first reported by InsideDefense.com.

The JET forecasts schedule slips and cost overruns that contrast with more optimistic projections made by the Pentagon’s F-35 program office and Lockheed Martin.

Carter indicated he believed the company and program officials may need to revise their estimates.

“I'm working with the contractor and the program office to improve the realism of the cost and schedule that is in the program of record," Carter said.
“This is a joint program, an international program. There are many people who are counting on good performance. … Which is why I would like to keep it as close to schedule and budget as we can manage it.”

Carter indicated that a realistic plan for the F-35 would be somewhere in between the estimates provided by the JET and those by the program office and Lockheed Martin.

“My job is to help the department think of ways that we can do things differently and end up somewhere in between the program office and the contractor estimate, and the JET estimate,” he said. “I can’t tell you where in between that we will end up, but I am looking for a realistic program schedule and cost.”

Carter’s comments came after a weekend review of the F-35 program that included meetings with Lockheed Martin CEO Robert Stevens and other executives on Sunday.

Carter described the discussions as “very cordial,” “constructive” and “professional.”

“The leadership of Lockheed Martin is committed to the Joint Strike Fighter program. They say that and I believe them,” Carter told reporters.

“On schedule, I emphasized to the CEO, and he agreed, that we need a realistic plan and commitment to that plan and as regards cost, that we need to address the affordability issue which is the hallmark of the Joint Strike Fighter program,” Carter said.

In order to avoid schedule slips, Carter said he was considering adding aircraft to the F-35 testing program. That move could allow “the necessary string of tests” to occur in a “more compressed time,” he said.

Another option is adding more personnel to speed up completion of the aircraft’s software, Carter said.

But no final decisions have been made about how the Pentagon will proceed with the F-35 program to avoid the significant cost increases and schedule delays forecast by the independent Pentagon analysts, Carter said.

He said he anticipates the new F-35 strategy will be implemented over the next few weeks as Pentagon officials finalize the 2011 defense budget plan.