December 22, 2016

Trump asks Boeing to price out Advanced Super Hornet F-18 with conformal fuel tanks to put negotiation pressure on Lockheed and the F-35

In response to a series of cost overruns and other development issues for the F-35 fighter jet, President-elect Donald Trump said on Thursday he has asked Boeing to "price-out a comparable F-18 Super Hornet."

Trump's request — announced via tweet — came a day after meeting separately with the CEOs from Lockheed Martin and Boeing to discuss bringing the "costs down" on the F-35 fifth-generation stealth jet and the next fleet of presidential aircraft.

On December 12, Trump said the cost for Lockheed Martin's fifth-generation stealth F-35 Lightning II jet was also "out of control." The message sent Lockheed Martin's stock down from $251 at the opening bell to $245.50, before it rebounded to a little more than $253 a share.

Boeing would clearly be super happy if they cut the price of the new Air Force One but then got an order for Advanced Super Hornets to replace some of the F-35 contract.



War is Boring discusses how the F-35 price tags are actually about double what Lockheed and the US Air Force try to claim.

On Dec. 12, 2016, president-elect Donald Trump asserted that F-35 unit cost was “out of control” through his preferred medium Twitter. On Dec. 19, 2016, U.S. Air Force Lt. Gen. Chris Bogdan, in charge of the Joint Strike Fighter project, gave the press his version of things.

The general said each one of the Air Force’s F-35A would cost $102.1 million, while both the U.S. Marine Corps’ F-35Bs and and U.S. Navy’s F-35Cs would set the taxpayer back 132 million each. Those costs average to approximately $122 million for a “generic” F-35.

Bogdan got these numbers from the funds Congress set aside in the 2015 defense budget for what the Pentagon called “Lot 9,” just one of a number of planned F-35 purchases. In November 2016, the U.S. military was still negotiating the final deal with plane-maker Lockheed Martin.

These figures are not the “sticker price.”

One could calculate a far more complete price from the appropriations that Bogdan told Congress he needed to buy functioning airplanes. The difference between what he is telling the press now and what he told Congress in 2015 is significant — it is also the difference between a factory simply putting together a airplane and delivering an airplane that can actually fly and operate.

For the 2015 fiscal year, the F-35 project chief petitioned Congress for $6.4 billion to produce 34 F-35s for the Air Force, Marine Corps and Navy. This amount did not included separate funds for research and development and other costs that the Pentagon asked for in budget request.




With the production data, we can calculate a F-35A has a price tag of $157 million, not $102 million. It’s $265 million for a F-35B and $355 million for a F-35C, not $132 million for either variant.

On average, these F-35s cost $188 million apiece, not $122 million.

More basically, Bogdan says the F-35’s price has been coming down, and indeed it has. The $188 million generic price in 2015 was less than the $250 million the Pentagon quoted in 2001.

However, an old Congressional Research Service report on the F-35 tells us that in 1994 the Pentagon was promising F-35As for $31 million, F-35Bs for $31 to $38 million and F-35Cs for between $30 and 35 million. In 2017 dollars, those costs would be $53 million per F-35A, $53 million to $65 million for each F-35B and $51 million to $60 million for a single F-35C.

Put another way, in 2017, a F-35A costs about twice what the Pentagon promised Congress more than two decades earlier. Compared to this initial estimate, the F-35B costs more than twice as much now, while an F-35C is about four times more expensive.

Trump can recognize when he is being scammed. In this case, the Pentagon is telling him American taxpayers can get F-35s for only two to four times what they originally advertised.

The flawed F-35 has formidable defenses (as a program, if not as an aircraft). Killing the project would require mollifying a wide variety of political interests within the United States, as well as large chunks of the defense industrial base. It would also require unruffling the feathers of allied governments, many of which have devoted considerable political capital to the purchase of the JSF.

President elect Trump seems to be far less concerned than prior presidents about ruffling allies and about messing with domestic political and business interests. Trump tweeted about the F35 yesterday and it trimmed $2 billion from Lockheed stock.



A combination of the following options is possible to replace the F35 program.

1. Build more F-22s. Restarting F-22 production would be expensive but the F22 is a proven and superior design. The would meet air force but not Navy or Marine needs.


2. Build improved unmanned systems
3. Update older fighters. Boeing has worked extensively at developing versions of both the F-15 and F / A-18 that have stealth characteristics. Boeing developed plans for the F-15 Silent Eagle, a modernization of the traditionally dominant fighter that would have dramatically reduced its radar signature. Similarly, Boeing has studied the concept of conformal fuel tanks on the F/A-18 Super Hornet, which would enhance its stealth capabilities and increase its range. Meanwhile, ever more sophisticated F-16s continue to roll off the production line.
4. Develop Generation Six fighter or systems



5. Buy foreign fighters like the Gripen, Eurofighter or Rafale. In order to have any chance of success, this would have to involve licensing deals to assemble and manufacture the aircraft in the United States. The US would be put into the uncomfortable position of requiring technology transfer agreements from European allies, rather than the other way around. This would have the advantage of putting the fear of almighty God in the U.S. defense industry, and of putting proven platforms into the hands of the USAF and USN. All three airframes are over a decade newer than the latest US legacy fighters, meaning that they still have significant upgrade potential. They also have reasonably reliable cost and performance expectations.

Boeing is pushing for conformal fuel tanks, an advanced cockpit system and a new engine for the Super Hornet that the company says would add even more range and warfighting capability.

Advanced Super hornet concept with conformal fuel tanks

Boeing has matured its Advanced Super Hornet concept to work with F35s and F22s.

The Navy has already put on contract three Super Hornet upgrades included in Boeing’s new Advanced Super Hornet design. The service will upgrade its Raytheon AN/APG-79 Active Electronically Scanned Array (AESA) radar. They added the Integrated Defensive Electronic Countermeasures (IDECM) Block IV with increased electronic warfare self-protection, which was fielded in 2016.

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