Exclusive: Japan Secures Extra Cost Cuts On U.S. F-35 Fighter Jet Package – Sources (excerpt)
(Source: Reuters; published Feb 1, 2017)
By Tim Kelly and Nobuhiro Kubo
TOKYO --- Tokyo has secured cost cuts on support equipment for its next batch of six U.S. F-35 stealth fighter aircraft of around $100 million, according to sources and Japanese budget papers, on top of savings being finalised for all buyers of the high-tech jets.

The deal represents a rare case of Tokyo negotiating down the price of military hardware from its U.S. ally and underscores progress for the Lockheed Martin Corp-run F-35 program, which has faced criticisms over cost overruns and other problems.

U.S. President Donald Trump, who lashed the program as "out of control" in December, said on Monday he had been able to shave some $600 million from the latest U.S. deal to buy about 90 F-35s from Lockheed.

But defense analysts and sources downplayed news of those cuts, saying the discount hailed by Trump was in line with what had been flagged by Lockheed for months and would apply to other countries committed to the program.

Lockheed and the Pentagon did not directly respond to questions regarding the Japanese deal.

A spokesperson for the U.S. Defense Department office which runs the F-35 program said negotiations over the current batch of fighters, known in the industry as LRIP 10, [were] continuing.

"For every nation that buys an F-35 in LRIP 10, the base price of the F-35 will be the lowest in F-35 history," Lockheed spokesman Michael Rein said. (end of excerpt)


Click here for the full story, on the Reuters website.


(EDITOR’S NOTE: Japan may want its taxpayers to think it was won concessions from Lockheed Martin and the United States on F-35 prices, but this is a complete sham.

According to the December 2015 Selected Acquisition Report (above), Japan is paying $4,360.4 million to buy 16 F-35As, with an option for 24 additional aircraft.
Simple arithmetic shows that Japan will pay $272 million for each F-35 (i.e., $4,360.4 : 16 = $272 million).
This is nowhere near the fantasy prices claimed by Lockheed Martin, nor the $136.81 million unit price quoted by Reuters in this story:
Interestingly, Israel is paying $151.75 million for each one of its 33 F-35s on order, and South Korea $156.3 million for each of its own 40 aircraft.
One reason is that Japan is assembling the aircraft itself, which substantially inflates costs.)


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