Report: Lockheed Aims to Save $5B on F-35 Program Amid Lot 11 Contract Negotiations

Lockheed Martin (NYSE: LMT) has initiated talks with suppliers to generate $5 billion in cost savings on the F-35 program as the company negotiates a contract to produce the 11th batch of fighter jets, Bloomberg reported Tuesday.

Julie Johnsson and Anthony Capaccio write Lockheed CEO Marillyn Hewson, also an inductee into Executive Mosaic’s Wash100 for 2017, told reporters Tuesday that President Donald Trump and his administration “put a sharper focus on price.”

Hewson’s statement came three months after she offered Trump her “personal commitment” to reduce the F-35 program’s cost and a month after the company finalized an $8.5 billion contract with the Defense Department to deliver 90 lot 10 F-35s.

Bruce Tanner, chief financial officer at Lockheed, said in an interview that he thinks Trump’s presence “creates momentum to get Lot 11 done quicker than we have in the past.”

The report said Trump’s proposed budget for fiscal 2018 included the procurement of additional F-35s for the U.S. Air Force.

An official with Lockheed said Tuesday the lot 11 agreement may place an order for up to 130 fighter jets from the company, the report added.