It has been an interesting week in the life of the F-35 program. First, Italy dropped plans to buy two fighters to participate in the initial testing phase, which some could — and have — interpreted as a vote of no confidence. Then, InsideDefense.com reported leaked US Air Force budget documents potentially adding billions of dollars to the F-35 program, a seemingly huge and timely shot of fiscal confidence.
But it’s possible that neither story is really what it seems.
The leaked USAF budget document calls for retiring 300 fighters and re-investing the $3.4 billion partly to accelerate F-35 procurement. That comes less than three months after the USAF also disclosed a receiving a $5 billion budget plus-up in the next six-year spending cycle, with the proceeds also partly flowing to speed up F-35 deliveries. In sum, some portion of $8.4 billion is being shifted to pay for more F-35s.
On its face, these proposals represent a huge turn-about in the USAF’s strategy, which had previously been to buy more F-22s at all costs, even at the expense of the F-35. It also helps restore the USAF’s original plan to buy a maximum 110 aircraft per year after 2012, not 48 as currently budgeted. Unit cost savings generated by larger annual orders would greatly help the F-35s affordability, a key concern as several international partners face looming procurement decisions.
But some aerospace industry experts are not convinced the USAF will so easily back off its demands to buy more F-22s. Here’s what Richard Aboulafia, vice president of the Teal Group, emailed me:
I think it’s prudent to expect Air Force F-35A procurement to stay at about 48 per year. But the big variable is added funding for F-22s. That, of course, would largely come out of F-35 funding, which probably helps explain the Air Force’s desire to bolster the F-35. All roads, perhaps, lead back to the Raptor.
So we’re back to the question: What is the USAF really up to?
On the other hand, Italy’s apparent rejection of the F-35 program earlier this week also might not be what it seems. Within the last two weeks, Italy’s Alenia Aeronautica has signed a deal to build 1,200 wing sets for the F-35, serving as a second source to Lockheed Martin. Moreover, Italy is also moving forward on establishing its own final assembly and check out line, and it’s very likely that the government simply plans to re-invest the savings from dropping out of the IOT&E phase into the capital needed to build the FACO line.