Lockheed CEO: New Deal to Cut Costs on Next F-35 Line ‘Close’

Marillyn Hewson

Lockheed Martin (NYSE: LMT) is “close to a deal” on a new contract that would “significantly” bring down costs of the next line of F-35 fighter jets and add 1, 800 new jobs at its Fort Worth, Texas facility that houses production, the company’s chief executive said Friday after a meeting with President-elect Donald Trump.

That new contract would also create “thousands more” jobs across the U.S. supply base for the F-35 program, CEO Marillyn Hewson added in a written statement and remarks to a pool of reporters inside New York City’s Trump Tower aired on CNBC.

Hewson also said the meeting included discussions on how to continue efforts to cut costs in the F-35.

The next contract for the F-35 will cover the program’s 10th batch for 94 aircraft and would follow the November 2016 award of a $6.1 billion unilateral contract for 57 airplanes.

Hewson’s statement comes two days after Trump promised “big things” for the F-35 during a news conference and indicated he would like to see a competition between that aircraft and the F-18 Super Hornet combat plane made by Boeing (NYSE: BA).

Trump first criticized the F-35 as “out of control” and too costly in a Dec. 12 Twitter post and subsequently met with Hewson Dec. 21 where she gave the president-elect her “personal commitment” to continue cost reduction efforts.

Trump then tweeted Dec. 23 he asked Boeing to price out a “comparable” F-18 Super Hornet fighter jet.

Shares in Lockheed traded up almost 1 percent to $255.03 and Boeing’s stock added $0.55 to $158.84, both as of 1 p.m. Eastern.

Executive Mosaic’s GovCon Index that includes Lockheed and Boeing climbed 0.63 percent to 89.008.

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