The Pentagon is poised to spend $761 million to buy two F-22 fighter planes and put a down payment on six more, marking a turning point in the technologically challenging Lockheed Martin Corp. program.
Testing and development of the Air Force jets are still going on, so "we view it as a vote of confidence on the part of the government to go ahead with the program," said Tom Burbage, Lockheed Martin's F-22 program manager.
Defense Secretary William S. Cohen is expected to certify the purchase to Congress this week. The Pentagon's top weapons buyer, Undersecretary of Defense Jacques Gansler, gave the contract his informal blessing Thursday and should sign an official memo in the next few days, the Air Force said.
"We're all very excited," said Burbage. "It assures us and assures our supplier base that the [military] is serious about moving forward."
Dubbed the Raptor, the F-22 is designed to use a combination of speed, maneuverability, sophisticated electronics and invisibility to radar to outfight any other aircraft in the world.
At a total development and production cost of $63.8 billion, the F-22 is also the world's most expensive fighter jet. The Air Force plans to buy 339 combat-ready models at a total public investment of more than $180 million per plane.
The pending contract calls for the military to spend $571 million for the first two production-line planes, and to provide $190 million in advance funding for the next six planes.
The full contract for that next batch is due to be awarded a year from now. If major technical or cost problems surface before then, the Pentagon can cancel the program but must pay several hundred million dollars worth of penalties.
Lockheed Martin -- joined by Boeing, which is building a third of the F-22s, and by engine-maker Pratt & Whitney -- has agreed to operate under a fixed-price contract for the first two sets of production planes.
That means the companies will have to eat any cost overruns. That is an unusual step, because most such contracts today require the government to cover all costs plus incentive fees for the contractors.
The companies agreed to the arrangement to demonstrate that they are committed to holding down expenses on the F-22, Burbage said.
"The budget pressures being what they are the Air Force needed that vote of confidence from the contractor team to keep the program on course," he said.
Because of concern over escalating costs, Congress has capped the current F-22 development contract at just over $19 billion and limited production spending to $40.9 billion. An earlier phase of development cost $3.8 billion.
The overall development effort continues even as the plane begins assembly-line production, with testing and troubleshooting not wrapping up until 2003. The F-22 has completed only about 200 hours of a 4,337-hour flight-testing program.
The F-22 is scheduled to enter service in 2004. It will replace the F-15C as the Air Force's top "air superiority" fighter jet.
Pub Date: 12/22/98