JSF special: Going global

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By Graham Warwick in Fort Worth

At full rate, production of the F-35 will draw on the manufacturing resources of not only the USA and UK, but the industries of partner nations around the world.

Contrary to press reports, no-one has yet signed up for any Joint Strike Fighters. What the partner nations have done is agree the draft of the memorandum of understanding (MoU) for the production, sustainment and follow-on development (PSFD) phase of the programme, which includes statements of intent from the eight international participants to acquire a total of 710 aircraft. But each needs national political approval to sign the MoU, planned for December, and even that will not commit them to buying F-35s.

stovl f-35 
© Lockheed Martin 

Italy will join the UK and US Marine Corps in operating the STOVL JSF

What it will do is enable Lockheed Martin and its partners to begin putting in place the global supply chain needed to produce and support the more than 3,000 aircraft planned. That includes establishing second sources within the partner nations for subassemblies and components that will be needed when the programme reaches full-rate production of some 200 aircraft a year. The industrial participation on offer will play a key role in whether all of the nations will sign the PSFD MoU.

“PSFD is the remainder of the life of the programme,” says Tom Burbage, Lockheed executive vice-president and general manager F-35 programme integration. “If a partner signs the MoU, it is acknowledging the fact that it will be part of the team going forward. It will be assessed a fee tied to a pro-rata share of the tooling and a share of the administration cost based on the number of aircraft planned,” he says. “But it is not a production order. It is not a commitment to buy.”

Orders will have to be placed 30 months before scheduled delivery, but most of the nations are not planning to make their next-generation fighter procurement decisions before 2008-2010 at the earliest. Other than “a couple of test aircraft” for Italy and the Netherlands, the first international purchases are planned for low-rate initial production (LRIP) Lot 4, for Australia and the UK. Second sourcing from international industrial partners is also planned to get under way later in LRIP.

The industrial participation plan presented to the partner nations is “quite specific”, says Burbage, and includes second sourcing of subassemblies and components by BAE Systems and Northrop Grumman as well as Lockheed. One deal agreed so far is for Italy’s Alenia Aeronautica to build the wing as a second source to Lockheed. Beginning with the outer wing, then the centre section, then mating and stuffing the complete centre wing, Alenia will eventually produce half of all wings at rate production.

Although industrial participation is key to winning production orders from the partner nations, outsourcing is also part of Lockheed’s plan to tap into the global supply chain to keep the JSF affordable. “We will not get to an affordable aircraft by keeping the work in-house,” says Edward Linhart, Lockheed vice-president F-35 production operations. “We have to move subassemblies to smaller, lower-overhead companies to get a better price.”

As the team plans ahead to rate production, it is analysing the capacity available and investment required and determining how much outsourcing is needed. “We are in the process of developing a second-source supply chain,” says Tom Fillingham, JSF programme manager for BAE, which is producing the aft fuselage, horizontal and vertical tails and CV outer wings. “We are working with local UK suppliers and also some of the international partners, principally Australia, Canada and the Danish.”

Northrop has already named several companies as second-source suppliers of composite parts and subassemblies for its centre fuselage, including Hawker de Havilland in Australia, Kongsberg Defence & Aerospace in Norway, Stork Aerospace in the Netherlands, Terma in Denmark and Tusas Aerospace Industries in Turkey. Stork’s Fokker unit is also producing in-flight operable doors and inner weapon bay doors, while its SP Aerospace division is developing the CTOL arresting gear.

Industrial participation, and particularly return on investment, has become a sensitive political issue in several partner nations in the run-up to a decision on signing the PSFD MoU. Nurtured by the industrial offsets that accompanied the purchase of Lockheed’s F-16, some nations’ industries have had difficulty adapting to the company’s competitive “best value” procurement policy for JSF. This led to a more targeted “strategic best value” sourcing approach that has moderated the concerns.

f-35c 
© Lockheed Martin   

Even the US Navy unique F-35C will benefit from economies of scale

Vocal critics

“Strategic best value acknowledges politics matters,” says Espen Barth Eide, Norway’s assistant defence minister. Oslo has been a vocal critic of the return on its JSF investment, but in May decided to stay in the programme – for now – after being presented with an improved package of Norwegian industrial participation in production and sustainment. Both government and industry believe Lockheed’s offer “is good enough to stay on board for now”, he says. The maximum potential is Nkr20 billion ($3.23 billion), “but NKr12 billion is quite certain if we stay on board”.

Norway is a good example of the task the JSF team faces in persuading each country’s industry and government to back the programme. “The MoU is a government-to-government issue. Our job is to make the industrial participation package attractive enough,” Burbage says. In Norway’s case, half is strategic sourcing and half is work that its industry will have “the opportunity to compete for and win”, he says.

Burbage cites Northrop’s letter of intent with Kongsberg to supply composite centre-fuselage components. “This is strategic, not competitive, sourcing. It is available to Kongsberg if it meets a competitive price.” An example of the second type is production of the conventional edges, for which Kongsberg is bidding now.

The process is being repeated across the partner nations, where much of the criticism has centred on the industrial return from their investment in the system development and demonstration phase. “Now we are talking about production and sustainment – and much larger funds,” says Burbage.

As well as second sourcing, a large part of the international participation is expected to come from the “global sustainment” plan to support the JSF in service. Although it is still being defined, global sustainment will involve supporting F-35s using the original equipment manufacturer infrastructure put in place for production.

Another issue to be resolved before the PSFD MoU can be signed in December involves restrictions on the transfer of US technology. Voiced most strongly by the UK, but also an issue for Italy and Australia, the concerns centre on ensuring “operational sovereignty” – their ability to maintain and upgrade the aircraft in service.

“The UK Ministry of Defence has identified technologies and capabilities that they feel are essential for UK operational sovereignty, and have provided those to the US government,” says Dan Bennett, director F-35 international programmes. “Lockheed Martin is working with the US and UK governments, along with BAE Systems and UK industry, to develop a technology transfer and licensing approach that will ensure we can deliver the industrial components of that capability.”

Technology transfer

A series of US/UK technical assistance agree­ments has allowed for the phased transfer of technology. Tom Fillingham, BAE’s F-35 programme manager, says: “We have everything we need for everything we do in SDD and production. The current technology transfer debate is about sovereign support, as sustainment will take UK industry into areas it is not currently involved in.”

US President George Bush and British Prime Minister Tony Blair agreed in late May that the UK will have the ability to operate, maintain and upgrade the JSF such that it retains operational sovereignty. The details are still being negotiated, but both Lockheed and BAE point out that the first F-35s are not due to arrive on UK soil until 2014-15 as initial testing is planned to be conducted in the USA.

Although several are years away from making a procurement decision, Lockheed is confident all eight international partners will sign up for the production and sustainment phase. The alternative is for a nation to give up its representation in the JSF programme office and go to the back of the queue and buy its F-35s through the usual foreign military sales channel.

The next few months will be critical for the Joint Strike Fighter programme, as the draft PSFD MoU is shepherded through the national political approval process in each partner nation. In the USA, meanwhile, the programme faces a challenge in Congress to secure funding to begin low-rate production. A successful first flight of aircraft AA-1 by late October will be a vital boost for the JSF.