Air Force Official Slams Lockheed Martin on F-35 Program

The new deputy head of the Pentagon’s F-35 Joint Strike Fighter program said his office’s relationship with plane manufacturer Lockheed Martin Corp. (LMT) is “the worst I’ve ever seen.”

Air Force Major General Christopher Bogdan, on the job five weeks as deputy program executive officer, fired an unusual public salvo at the world’s largest defense contractor for what he described as a poor partnership in managing the Pentagon’s most expensive weapons program.

“We will not succeed on this program until we get past that,” Bogdan said in a discussion on the F-35 at the annual conference of the Air Force Association, a nonprofit civilian organization that promotes aerospace education. “We have to find a better place to be in this relationship. We have to.”

“We agree with Major General Bogdan that it takes everyone to be fully engaged to be successful,” said Michael Rein, a spokesman for Lockheed’s F-35 program. “We remain committed to continuing our work to solve program challenges and build on the momentum and success we’ve achieved during the past couple of years.”

The $395.7 billion F-35 acquisition program has been subject to criticism for years for ballooning costs. The $395.7 billion estimate is a 70 percent increase from the $233 billion projected in late 2001, when development began, after adjusting for inflation.

Photographer: Tom Pennington/Getty Images

A general view during the United Kingdom F-35 Lightning II delivery ceremony on July 19, 2012 at Lockheed Martin Corporation in Fort Worth, Texas. Close

A general view during the United Kingdom F-35 Lightning II delivery ceremony on July... Read More

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Photographer: Tom Pennington/Getty Images

A general view during the United Kingdom F-35 Lightning II delivery ceremony on July 19, 2012 at Lockheed Martin Corporation in Fort Worth, Texas.

‘No Money’

Bogdan said he has no intention of asking Congress for any more money for the F-35 beyond what’s already in the pipeline.

“There is no more money and no more time in the development of this program,” he said. “That is it. We will not go back and ask for any more.”

Asked what changes he would seek to make, Bogdan said, “We’ve got to shed our baggage,” while declining to elaborate.

While not offering specifics on the source of the problem with Bethesda, Maryland-based Lockheed, Bogdan said, “It should not take 10 or 11 or 12 months to negotiate a contract with someone we’ve been doing business with for 11 years.”

Bogdan cited three other concerns with the F-35 program that he said may cause delays. Calling the plane “a flying software computer,” he said that software development is behind schedule and may slip further behind as its complexity increases.

“Software is a huge risk, and we’ve got to do business a little differently,” he said.

Helmet Problems

He also cited problems with the helmet worn by F-35 pilots that he said must be corrected. Testing on the helmet will be conducted in the next 60 to 90 days, he said.

His office is also considering an alternative helmet made by BAE Systems Plc (BAESY) as a potential “back-up plan,” he said.

He also cited hurdles in the plane’s complex logistical system that may slow plans to get the aircraft into operation.

While saying he saw “glimmers of hope” in getting the program under control, Bogdan told reporters later, “if we do not improve on a day-to-day basis the way we deal with Lockheed Martin, we’re not going to get there.”

The first four contracts, for 63 jets, exceeded their combined target cost by $1 billion, according to congressional auditors.

Bogdan’s unusual public salvo came as the Pentagon is under growing pressure to cut costs. The Defense Department faces an additional $500 billion in cuts to future spending over the next decade unless Congress acts to prevent automatic across-the- board cuts that are slated to begin in January.

To contact the reporter on this story: David Lerman in Washington at dlerman1@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net

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