As the daffodils return to D.C., the Pentagon has kicked off its annual engine-bashing event in preparation for contract negotiations with Pratt & Whitney, the United Technologies unit that makes the powerplant of the F-35 fighter. F-35 program executive officer Chris Bogdan is complaining that Pratt has failed to bring down the cost of each F135 engine (that’s the engine’s official designation) at the rate it committed to several years back. However, that isn’t Pratt’s fault: its cost commitments were predicated on an expected ramp-up of engine production that hasn’t materialized. In fact, as a result of five separate program reschedules, the Pentagon has cut the planned engine production rate between 2013 and 2016 by 67%. It has also slashed use of the engine on the Air Force’s F-22 fighter that shares components and servicing with the F-35’s engine. So of course engine costs are not falling at the pace originally projected, because the government has wiped out the economies of scale essential to achieving optimum efficiency. The cost of the engines has declined with each successive production lot, but there’s just so much you can do when your main customer keeps moving the goal post. I have written a commentary for Forbes here.
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