After drawn out negotiations with the Department of Defense, Lockheed Martin signed a contract to produce the eleventh lot of the F-35A for $89.2 million per unit.

The price for the US Air Force’s conventional-takeoff-and-landing variant of the stealth fighter is the lowest yet, a 5.4% reduction from the prior production lot.

The low rate of initial production (LRIP) 11 agreement funds 91 aircraft for the US services, 28 for international development partners and 22 foreign military sales customers. Production of the aircraft started this year and deliveries will begin in 2019.

The US Marine Corps’ vertical-take-off-and-landing variant, the F-35B, cost fell to $115.5 million per unit in LRIP 11, a 5.7% reduction from the prior lot. The US Navy’s short-take-off-and-landing variant, the F-35C, cost was lowered to $107.7 million per unit in LRIP 11, an 11.1% reduction from the prior lot.

“As production ramps up, and we implement additional cost savings initiatives, we are on track to reduce the cost of the F-35A to $80 million by 2020, which is equal to or less than legacy aircraft, while providing a major leap in capability,” says Greg Ulmer, F-35 vice president and general manager.

Notably, the $80 million per unit figure cited by Lockheed Martin does not include initial development or upgrade costs, the so-called Continuous Capability Development and Delivery programme. The joint strike fighter programme has been criticised for its development overruns and ballooning upgrade costs.

Lockheed Martin says it has produced more than 320 F-35 aircraft, which now operate from 15 bases around the globe. The company says more than 680 pilots and 6,200 maintainers have been trained and the international F-35 fleet has more than 155,000 cumulative flight hours.

After years of development and low rate production, the USMC used an F-35B to launch an air strike in Afghanistan for the first time on 27 September. The Israeli Air Force was the first to use the aircraft in combat, declaring in March that its F-35I Adirs participated in two air strikes in the Middle East this year.