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F-35 Funds Withheld From Pratt & Whitney Over Delays

The Pentagon is withholding funds from United Technologies Corp. (UTX)’s Pratt and Whitney unit because of persistent delays in delivering engines for the F-35, the head of the fighter program said.

“They’ve stayed steady” in the last two years, Lieutenant General Christopher Bogdan, head of the F-35 program office, told reporters today. “They haven’t gotten any better, but they haven’t gotten any worse.”

Pratt & Whitney is the sole provider of engines for the $391.2 billion F-35, the Defense Department’s costliest weapons project. The company has delivered 134 engines and 46 lift fans for the propulsion system on the F-35B, the short-takeoff and vertical landing version to be used by the Marine Corps.

The delays stem from flaws, many of them discovered as the engines are being delivered to the military. “Right at the end, which is not a good place to find things,” Bogdan said after testifying before the House Armed Services Committee.

Bogdan said he didn’t have readily available how much is being withheld or has been permanently lost to Pratt & Whitney.

Matthew Bates, a spokesman for the unit of Hartford, Connecticut-based United Technologies, didn’t have an immediate comment on Bogdan’s remarks. Lockheed Martin Corp. (LMT) is the prime contractor on the F-35.

Bogdan said in a statement to the House panel that the latest production lot of engines is “currently slightly ahead of contract delivery dates. However far too often engine deliveries are interrupted by technical issues and manufacturing quality escapes” resulting from deficiencies.

Although the delays are forcing the company to miss contractual milestones, it has never stopped Pratt & Whitney from delivering an engine “by the time we needed it to put into an airplane,” Bogdan said. The engine is assembled by Pratt & Whitney from components made by subcontractors, he said.

“We withhold money,” Bogdan said. “Sometimes we permanently withhold, which means they never get it back, and other times we withhold for contract delay or simply because there is a quality escape.”

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editors responsible for this story: John Walcott at jwalcott9@bloomberg.net Larry Liebert, Mark McQuillan

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