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WITHOUT FANFARE

Italy's first F-35A has quietly entered assembly - but questions reamin over the nation's degree of involvement in the project

By: Luca Peruzzi

Lockheed Martin
Italy and other customers will pay $103 million for each F-35A from LRIP 6

Italy has marked another significant milestone in the international assembly programme for the Lockheed Martin F-35 Joint Strike Fighter.

However, there has been opposition in the cash-strapped country to both the cost and scope of Italy’s industrial participation in the programme.

For that reason, there was little fanfare among the Italians last July when news broke that it had launched assembly activities for the first conventional take-off and landing F-35A from Low Rate Initial Production lot six (LRIP 6) at a new final assembly and check-out (FACO) facility inside Cameri Air Base, west of Milan.

The US Department of Defense (DoD) awarded two contracts worth $7.8 billion to Lockheed Martin on 28 September covering 71 F-35s for US and international customers. Of these, six F-35As are bound for Italy, equally split between LRIP 6 and 7.

FALLING COSTS

Italy and other customers will pay $103 million for each F-35A from LRIP 6 and $98 million for those from LRIP 7.

These price tags are approximately 2.5% and 6% lower respectively than aircraft from LRIP 5 – excluding, for both aircraft batches, the cost of engine and retrofits. “The F-35A cost for first multi-year procurement contract calendar year (2018) is expected to drop below $85 million, including engines, avionics and non-recurring costs,” Lockheed Martin's vice-president of F-35 program integration and business development Steve O'Bryan said to Flight International.

The recent downsizing of Italy’s F-35 fleet to 90 aircraft, comprising 60 F-35As and 30 short take-off and vertical landing (STOVL) F-35Bs – the latter equally divided between the Italian air force and navy – “lowered the overall programme cost to €14.3 billion ($20 billion), of which €2.1 [billion] has already been spent”, Lt Gen Domenico Esposito, head of the General Directorate for Air Armaments , which handles air systems procurement, said in a recent interview.

However, this figure does not include the aircraft’s operating costs, which are reportedly higher than expected, according to the F-35 Joint Program Office, and the integration cost of customer-specified weapons.

To be completed in 2014, the Italian defence ministry’s F-35 facility is divided into two main areas, devoted to FACO and to maintenance, repair, overhaul and upgrade (MRO&U) activities for both -A and -B variants respectively, with capacity for two aircraft per month, together with wing production and an assembly line.

Managed by Alenia Aermacchi and Lockheed Martin and currently manned by around 300 personnel, this number is expected to increase to around 1,000 when the facility is fully operational.

“The FACO will begin assembly activities on the second F-35A from November 2013, while the first is planned to be delivered in the last quarter of 2015,” O'Bryan says.

These and follow-on aircraft will be delivered with the same operational software as the US Air Force’s F-35As, which are planned to reach initial operational capability (IOC) in August 2016, to be followed by Italian and Israeli aircraft.

INTERNATIONAL DEPLOYMENT

Reportedly, the first five F-35As will be deployed to the US Air Force’s Luke Air Force Base in Arizona, for training activities, while the first aircraft will reach Amendola Air Base in southeast Italy in late 2016. The Italian navy’s first F-35B, due to be included in LRIP 9, is expected to be delivered in 2017, while Taranto-Grottaglie Air Base will receive its first aircraft the following year, with pilots to be trained in the US at Marine Corps Air Station Beaufort, South Carolina, together with UK colleagues.

In early 2011, Alenia Aermacchi began wing component assembly on the Cameri site to reduce learning curve risks in advance of launching activities on the new wing production and assembly line, developed as a twin of Lockheed’s facilities in Fort Worth, Texas.

As a major element of the Italian industry’s participation in the F-35 programme, in addition to Alenia’s facilities at Venegono, Nola and Foggia, a group of small to medium-sized companies spread throughout the country, including OMA, NCM, OMPM, OMI and LMA, provide the wing ‘equivalent’ components (including forward and aft wing carry-through, right and left outer wing boxes), which are assembled at Cameri.

Lockheed Martin
The F-35A will form the backbone of the
Italian air force's future fleet

Lockheed and Alenia signed a long-term agreement in February for production of the first 130 wing equivalents, ensuring aircraft low-rate production cover (LRIP 6-11) and is worth an estimated $1.2 billion, largely related to foreign customers. In late April, the two companies signed a $141 million contract for wings for LRIP 6 and 7, including $60 million in non-recurring engineering costs. Following lots will see planned increments in the amount of work handled, up to LRIP 11, when Alenia is expected to have its first full-wing delivery to Lockheed.

The overall Cameri facility represents an investment challenge for both the Italian government and the Alenia/Lockheed industrial team, as both Italy and the Netherlands have significantly reduced the number of F-35s ordered to 90 and 37 respectively, reducing the return on the Cameri investment.

The two countries signed an agreement in 2006 by which the Dutch defence ministry will provide maintenance and overhaul support at its Woensdrecht logistics centre for the Italian aircraft’s Pratt & Whitney F135 engines, while Italy will assemble the Royal Netherlands Air Force’s F-35As. Esposito was still confident recently of improving these figures with other potential sales in the European and Mediterranean regions. Belgium’s government is reportedly showing a new interest in an F-35 acquisition.

The majority of investment returns are consequently expected to come from future F-35 support activities for regional operators, including the US military, with Lockheed seeing the Italian FACO “as being the logical maintenance, repair, overhaul and upgrade centre of excellence for the European and Mediterranean region”, O’ Bryan says.

CO-OPERATION ROADMAP

The agreement between Italy and the Netherlands saw further progress on 20 September with the signing of a follow-on technical-industrial cooperation roadmap agreement, which will help further develop programme management on the European level for the long-term sustainment of the aircraft in the European-Mediterranean region.

Norway also joined the original Italian-Netherlands agreement for aircraft maintenance and support activities, and a similar cooperation agreement was signed with the UK in early September.

During September’s DSEI 2013 exhibition in London, Philip Dunne, the UK Minister for Defence Equipment, Support and Technology, acknowledged a series of meetings between European customers for joint maintenance, support and European armaments integration, including the MBDA Meteor beyond-visual-range air-to-air missile.

Over the past year, Cameri’s F-35 facilities have been visited by Dutch, Norwegian and UK air force chiefs. In March, the head of the Israeli Air Force’s Materiel Directorate also visited Cameri.

The return on Italy’s investment is also connected to national industrial participation in the programme. Beyond the LRIP 6-11 wing components agreement between Lockheed and Alenia, “there is potential overall business for a minimum 835 wing-sets throughout the F-35 programme based on best-value philosophy”, according to O’Bryan.

Other Finmeccanica companies are involved in the programme, including Selex ES with a swathe of components and activities including the aircraft’s back-up radios, cockpit lightning, electro-optical targeting system, electronic warfare components and supply chain management.

In a recent hearing before the Italian parliamentary defence committee, Finmeccanica’s chief executive, Alessandro Pansa said that “Italian industrial return from the [F-35 project] stands at $715 million, of which $565 [million] has been awarded to Finmeccanica companies.”

While he lowered the programme’s estimated overall potential economic return to around $10 billion – sharply down from the Italian defence ministry’s initial figure of $14.6 billion – even this lower figure “will depend on [Italy’s] capability to use the FACO for MRO&U purposes in support of UK, Netherlands and Norwegian aircraft, in addition to US F-35s deployed in Europe”.

He added that the overall workforce employed in Italy on the F-35 project could reach 5,000 people in the years ahead – just half of the initial estimate of 10,000 given by the Italian defence ministry.