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Yahoo
19 hours ago
- Business
- Yahoo
The Top 5 Analyst Questions From Lockheed Martin's Q2 Earnings Call
Lockheed Martin's second quarter was marked by program-related losses and operational challenges that led to a significant shortfall versus Wall Street's expectations. Management attributed these results primarily to $1.8 billion in charges across several legacy programs, including classified aeronautics and helicopter contracts. CEO James Taiclet described the financial impact as 'disconcerting,' noting that unexpected cost growth on long-term contracts required a comprehensive reassessment of program assumptions and management oversight. These actions reflect Lockheed Martin's effort to address technical and contractual challenges while maintaining a focus on supporting key defense priorities. Is now the time to buy LMT? Find out in our full research report (it's free). Lockheed Martin (LMT) Q2 CY2025 Highlights: Revenue: $18.16 billion vs analyst estimates of $18.59 billion (flat year on year, 2.3% miss) EPS (GAAP): $1.46 vs analyst expectations of $6.42 Adjusted EBITDA: $970 million vs analyst estimates of $2.53 billion (5.3% margin, 61.6% miss) The company reconfirmed its revenue guidance for the full year of $74.25 billion at the midpoint EPS (GAAP) guidance for the full year is $21.85 at the midpoint, missing analyst estimates by 19.7% Operating Margin: 4.1%, down from 11.9% in the same quarter last year Backlog: $166.5 billion at quarter end, up 5.2% year on year Market Capitalization: $98.37 billion While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Our Top 5 Analyst Questions Lockheed Martin's Q2 Earnings Call Myles Walton (Wolfe Research) pressed on whether problematic development programs have truly been derisked. CEO James Taiclet emphasized new oversight teams and recurring senior management reviews, while CFO Evan Scott committed to continued transparency and active risk monitoring. Ronald Epstein (Bank of America) questioned why it took large charges to change review processes and how these charges affect cash flow. Taiclet explained that new cost risks were identified only after updated monitoring, and Scott detailed the cash flow impact, noting a $500 million usage this year and step-down in future years. Rob Stallard (Vertical Research) asked about reduced F-35 procurement in government requests and the flexibility to fill slots with export orders. Taiclet described the congressional process and highlighted the strength of the F-35 backlog and flexibility to adjust production to international demand. Sheila Kahyaoglu (Jefferies) sought clarity on a $4.6 billion IRS tax claim and its effect on future cash flow. Scott stated the company disputes the tax position, has reserved $100 million, and expects little impact on long-term cash flows due to new legislation and pension assumptions. Peter Arment (Baird) inquired about the Golden Dome missile defense opportunity and its timing for backlog growth. Taiclet said the opportunity remains unquantified until contracts are issued but highlighted ongoing architectural discussions and readiness to invest in capacity. Catalysts in Upcoming Quarters In coming quarters, our team will watch (1) progress on restructuring or derisking legacy contracts, especially in classified programs and helicopter platforms, (2) the pace of new contract awards for missile and aircraft systems that could drive backlog growth, and (3) margin stabilization as production scales and operational improvements take hold. Developments in government defense budgets and the resolution of tax matters will also be important to track. Lockheed Martin currently trades at $423, down from $461.34 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it's free). High-Quality Stocks for All Market Conditions When Trump unveiled his aggressive tariff plan in April 2024, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that's already erased most losses. Don't let fear keep you from great opportunities and take a look at Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). 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Yahoo
22-07-2025
- Automotive
- Yahoo
Reworked F-35 Pitched As ‘Bridging Fighter' Ahead Of F-47
Taiclet then moved on to the company's proposal to provide the F-35 with a range of potential modifications to create what was previously referred to as a 'Ferrari' or 'NASCAR upgrade' to the F-35's core 'chassis.' The company is now increasingly describing this initiative as a 'fifth-generation-plus' development of the basic F-35. As to what comes next for the F-35, Taiclet said he was 'very, very confident that the F-35 is here to stay and here to stay for a long time,' recalling that fact that it is the 'only fifth-generation fighter aircraft in production today in the free world.' Taiclet noted that, as well as air-to-ground, the F-35 has, in recent campaigns in the Middle East, excelled in terms of its 'orchestration of numerous other platforms.' Those other platforms have included assets at sea, in space, as well as other aircraft, including fourth-generation ones. Talking about the F-35, Taiclet pointed to the aircraft's success in the U.S. attacks on nuclear facilities in Iran last month, Operation Midnight Hammer . The CEO describes that particular mission as being 'led by the F-22 and F-35.' Between them, the stealth fighters 'provided the air dominance and defense suppression required for the bombers to reach Iran's hardened nuclear sites,' Taiclet said. 'Our platforms operated essentially undetected in highly defended and contested airspace, underscoring the value of advanced stealth, superior electronic warfare, and broadband communications capability.' In the second quarter, Lockheed Martin delivered 50 F-35s, bringing the company's total deliveries for the year to 97. More significantly, the manufacturer has now handed over 207 F-35s since it resumed deliveries last year , having paused them for around a year due to problems with the vital Tech Refresh 3 suite, or TR-3. The company says it is now on track to deliver between 170 and 190 F-35s this year. These details and more were provided in a second-quarter earnings call earlier today that involved Taiclet as well as Lockheed Martin Chief Financial Officer Evan Scott, and Maria Ricciardone, the company's Vice-President, Treasurer and Investor Relations. Lockheed Martin envisages its F-35 stealth jet as the 'bridging fighter' that will allow the U.S. Air Force to transition to the sixth-generation F-47, from rival Boeing. Speaking today, Lockheed Martin CEO Jim Taiclet reiterated the goal of inserting technologies developed under the company's unsuccessful Next Generation Air Dominance (NGAD) bid into a future version of the F-35. At the same time, the company discussed 'a highly classified program' in the aeronautical sector on which it admits it has so far suffered significant financial losses. La historia continúa 'We did bid on NGAD, and we weren't selected,' Taiclet reflected, referring to Lockheed Martin's loss to Boeing, which is now building the F-47 crewed sixth-generation fighter to meet that requirement. An artist rendering of Boeing's F-47. U.S. Air Force 'But the pivot that we made is one we're taking very seriously, which is how we create a bridge from today's fifth generation to the sixth-generation NGAD, which might not be fielded for a lot of years,' Taiclet said. 'How do we bridge capability there?' Taiclet continued. 'We're going to port a lot of our own NGAD R&D over to the F-35 and potentially over to the F-22 as well.' The CEO again stated the aspiration to develop modifications to the F-35 that mean the company can offer 80 percent of the effectiveness of a sixth-generation fighter, at 50 percent of the cost per unit. Taiclet added that, in terms of matching capabilities, the 80 percent figure also referred to the degree of stealth, as well as 'other aspects.' The fifth-generation-plus version of the F-35 is, Taiclet contended, 'the best-value option for the U.S. government going forward; it will be only one I'm aware of that will make that bridge, for maybe 10 years.' Not immediately clear is whether Taiclet expects a major delay on the F-47 program that will make an interim fighter a more urgent priority, although that would be one interpretation of this. As it stands, the Air Force has not said when it expects the F-47 to achieve initial operating capability. An Air Force graphic that states the F-47 would become operational between 2025 and 2029 very likely refers to the planned first flight of the F-47 and some of its developmental testing, as you can read about here. U.S. Air Force Although not discussed today in the course of the earnings call, in the past, Lockheed Martin has raised the possibility of a pilot-optional F-35, as well as new infrared and radar coatings. This latter modification corresponds with secretive U.S. military testing in recent years of new mirror-like coatings on F-35s, as well as F-22 Raptor and F-117 Nighthawk stealth jets. A U.S. Navy F-35C test jet with a mirror-like coating. U.S. Navy Other F-35 modifications discussed by the company include electronic warfare improvements, networking improvements, and autonomy. Lockheed Martin has also previously discussed potential changes to the F-35's outer mold line, especially with regard to the engine inlets and exhaust nozzle. Meanwhile, the feasibility of the fifth-generation-plus proposal, as well as the huge claims around the capability/cost match of such an aircraft compared to a sixth-generation design, remains very much open to question. However, the company is confident that such advances are not only possible but can also be achieved rapidly, if required. Earlier this year, Taiclet said he thought that, in the space of two to three years, it would be possible to port enough of the NGAD technologies over into the F-35 to provide 'a meaningful increase in capability for the F-35.' That two-to-three-year timeline related to 'first flight and integration,' Taiclet added. A U.S. Air Force KC-135 Stratotanker refuels a U.S. Air Force F-35A off the coast of Greece in October 2024. U.S. Air Force photo by Senior Airman Edgar Grimaldo Senior Airman Edgar Grimaldo It's also worth noting that, earlier this year, U.S. President Donald Trump mentioned the so-called F-55, a purported development of the F-35. Trump described the F-55 as a twin-engined F-35 and also discussed an 'F-22 Super' that would be an upgraded version of the Raptor. The exact status of the F-55 remains unclear, if it ever existed. Taiclet also discussed a separate 'highly classified' aeronautical program being run by Lockheed Martin Skunk Works, as a part of that division's efforts to 'push the boundaries of science and technology to deliver highly advanced solutions that provide our customers a step-function advantage over potential adversaries.' It's notable that such a project would even be mentioned, although its discussion within the context of the earnings call was limited to the losses that it has accumulated for the company. There was no indication whether the platform is crewed or uncrewed, or what kind of mission it will fulfil, although there have been other reports of secretive Skunk Works projects going over budget. F-35s under construction. Lockheed Martin 'This particular program discovered new insights in the quarter that required us to adjust our expected future costs on that program and then recognized the charge for doing so,' Taiclet added. 'I acknowledge the losses on this classified program are significant. Again, we are taking these charges very seriously.' In response to the losses, Lockheed Martin has made changes to the program team management and assigned experts across the company to improve the performance and oversight of this program under what Taiclet said was 'a comprehensive risk-identification and corrective action plan.' 'This is a highly classified program that can only be described as a game-changing capability for our joint U.S. and international customers,' Taiclet added, 'and therefore it is critical that it be successfully fielded.' With the classified program now at least being publicly acknowledged for the benefit of company shareholders, it's possible that more information about it might begin to emerge. Clearly, however, Lockheed Martin's efforts to develop advanced new aerospace technologies encompass programs above and beyond its ongoing efforts to rework the F-35. Contact the author: thomas@
Yahoo
30-05-2025
- Business
- Yahoo
The F-35 could be 'pilot optional' in the not-too-distant future, Lockheed Martin CEO says
Lockheed Martin's CEO announced plans for an uncrewed F-35. The F-35 and F-22 will gain next-gen stealth, electronic warfare, and weapons improvements, he said. The US Air Force wants uncrewed aircraft to support piloted ones and add mass to its force. Lockheed Martin is developing an advanced version of its F-35 stealth fighter jet that could potentially be uncrewed, the company's CEO said on Wednesday. Speaking at the Bernstein's 41st Annual Strategic Decisions Conference, CEO Jim Taiclet floated the possibility of an F-35 whose pilot could be "optional" within a "relatively modest time frame." He outlined what he called "fifth-gen-plus" aircraft, where within two or three years both the F-35 and the older F-22 Raptor would feature several capabilities, including stealth coatings, electronic warfare improvements, and an unspecified weapons improvement, he said. Lockheed is repurposing much of this tech from its failed bid for the F-22 Raptor replacement, advances whose capabilities could rival those of the winning jet design at a much lower cost. Boeing secured the contract for the US Air Force's Next-Generation Air Dominance program, or NGAD, to develop the sixth-generation F-47. Lockheed Martin didn't protest the decision. "Our target is 80% of the capability of an NGAD sixth-generation at 50% of the unit costs," Taiclet said. These improvements would be introduced in stages, he said, with consideration to how the aircraft will be integrated with other systems. Some updates could be done in two to three years for "a meaningful increase in capacity," Taiclet said. That includes stealth coatings on the aircraft's surface and adjustments to its shape, as well as electronic warfare and weapons capabilities upgrades. Sixth-generation are a class of aircraft whose stealth, speed, automation and extended range are expected to make them the world's premier aircraft as they enter service in the 2030s. More than 1,200 F-35s have already been delivered to the US and 12 additional countries' militaries. The F-35 program has hit several snags over the years, including costs and goals. The lifetime F-35 program costs top $2 trillion, and sustainability costs are also rising. Last year, the US Government Accountability Office assessed that the F-35 isn't hitting mission-capable goals and hasn't for years. On a company earnings call in April, Taiclet said the fifth-gen plus upgrade focused on better capabilities at a lower cost but details were sparse. "We're basically going to take the [F-35] chassis and turn it into a Ferrari," he said. Autonomous or uncrewed capabilities in aircraft have been a top priority for the US Air Force. Its Collaborative Combat Aircraft initiative has focused on unmanned aircraft capable of operating alongside piloted aircraft or autonomously for a variety of missions. Air Force leadership has touted these "loyal wingmen" as not only giving pilots a variety of options for how to employ them — as sensors, weapons carriers, or jamming platforms — but also offering the possibility of having enough with lower costs than crewed aircraft. That could be key in a conflict with a peer adversary, like China or Russia. A pilot could direct a CCA on missions too dangerous for crewed fighters. At the conference, Taiclet said Lockheed Martin's interest in pilot-optional F-35s lent itself to the CCA. "We're thinking of the F-35 not just as a standalone aircraft, but how it can interface with sixth generation and with unmanned aircraft and itself be optionally manned," he said. Efforts for F-35 autonomy would be similar to the Air Force's AI-guided F-16 fighter jet that's been used in recent years to test AI pilots. The aircraft is part of the Air Force and Defense Advanced Research Project Agency (DARPA)'s AI fighter jet pilot program, which has been working on testing, iterating, and updating AI agents to fly the jet. Last year, then-Air Force Secretary Frank Kendall flew in the X-62A pilot by AI, "witnessing several AI agents as they autonomously maneuvered the X-62 against a manned F-16 in dogfighting engagements," an Air Force official said at the time. Those manned-unmanned dogfights have been ongoing and the service has said it's learning a lot of information from them, especially on how autonomous aircraft could aid or support manned pilots. Read the original article on Business Insider
Business Insider
30-05-2025
- Business
- Business Insider
The F-35 could be 'pilot optional' in the not-too-distant future, Lockheed Martin CEO says
Lockheed Martin is developing an advanced version of its F-35 stealth fighter jet that could potentially be uncrewed, the company's CEO said on Wednesday. Speaking at the Bernstein's 41st Annual Strategic Decisions Conference, CEO Jim Taiclet floated the possibility of an F-35 whose pilot could be "optional" within a "relatively modest time frame." He outlined what he called "fifth-gen-plus" aircraft, where within two or three years both the F-35 and the older F-22 Raptor would feature several capabilities, including stealth coatings, electronic warfare improvements, and an unspecified weapons improvement, he said. Lockheed is repurposing much of this tech from its failed bid for the F-22 Raptor replacement, advances whose capabilities could rival those of the winning jet design at a much lower cost. Boeing secured the contract for the US Air Force's Next-Generation Air Dominance program, or NGAD, to develop the sixth-generation F-47. Lockheed Martin didn't protest the decision. "Our target is 80% of the capability of an NGAD sixth-generation at 50% of the unit costs," Taiclet said. These improvements would be introduced in stages, he said, with consideration to how the aircraft will be integrated with other systems. Some updates could be done in two to three years for "a meaningful increase in capacity," Taiclet said. That includes stealth coatings on the aircraft's surface and adjustments to its shape, as well as electronic warfare and weapons capabilities upgrades. Sixth-generation are a class of aircraft whose stealth, speed, automation and extended range are expected to make them the world's premier aircraft as they enter service in the 2030s. More than 1,200 F-35s have already been delivered to the US and 12 additional countries' militaries. The F-35 program has hit several snags over the years, including costs and goals. The lifetime F-35 program costs top $2 trillion, and sustainability costs are also rising. Last year, the US Government Accountability Office assessed that the F-35 isn't hitting mission-capable goals and hasn't for years. On a company earnings call in April, Taiclet said the fifth-gen plus upgrade focused on better capabilities at a lower cost but details were sparse. "We're basically going to take the [F-35] chassis and turn it into a Ferrari," he said. AI-guided fighters Autonomous or uncrewed capabilities in aircraft have been a top priority for the US Air Force. Its Collaborative Combat Aircraft initiative has focused on unmanned aircraft capable of operating alongside piloted aircraft or autonomously for a variety of missions. Air Force leadership has touted these "loyal wingmen" as not only giving pilots a variety of options for how to employ them — as sensors, weapons carriers, or jamming platforms — but also offering the possibility of having enough with lower costs than crewed aircraft. That could be key in a conflict with a peer adversary, like China or Russia. A pilot could direct a CCA on missions too dangerous for crewed fighters. At the conference, Taiclet said Lockheed Martin's interest in pilot-optional F-35s lent itself to the CCA. "We're thinking of the F-35 not just as a standalone aircraft, but how it can interface with sixth generation and with unmanned aircraft and itself be optionally manned," he said. Efforts for F-35 autonomy would be similar to the Air Force's AI-guided F-16 fighter jet that's been used in recent years to test AI pilots. The aircraft is part of the Air Force and Defense Advanced Research Project Agency (DARPA)'s AI fighter jet pilot program, which has been working on testing, iterating, and updating AI agents to fly the jet. Last year, then-Air Force Secretary Frank Kendall flew in the X-62A pilot by AI, "witnessing several AI agents as they autonomously maneuvered the X-62 against a manned F-16 in dogfighting engagements," an Air Force official said at the time. Those manned-unmanned dogfights have been ongoing and the service has said it's learning a lot of information from them, especially on how autonomous aircraft could aid or support manned pilots.
Yahoo
30-05-2025
- Business
- Yahoo
What We Just Learned A More Advanced 'Ferrari' F-35 Could Include
Pilot-optional F-35 Joint Strike Fighters could be coming in the future as Lockheed Martin looks for ways to ensure the jets remain relevant for decades to come. Technology from the company's unsuccessful bid for the U.S. Air Force's Next Generation Air Dominance (NGAD) sixth-generation fighter competition, along with new coatings and other modifications, could also go into what it has previously called a 'Ferrari' or 'NASCAR upgrade' to the F-35's core 'chassis.' The feasibility of this proposal, as well as the huge claim that it could produce a jet with 80 percent of the capability of a sixth-generation design at 50 percent of the cost, remains very much in question. In the meantime, Lockheed Martin says overall demand for the F-35 remains strong and that new customers, potentially including Saudi Arabia and India, could be on the horizon. Speaking at Bernstein's Strategic Decisions Conference yesterday, Lockheed Martin CEO Jim Taiclet said he thinks that, in the space of two to three years, 'we could have a meaningful increase in capability for the F-35' by porting some of the NGAD technologies over. In March, the Air Force announced that Boeing had won the NGAD combat jet competition with a design now designated the F-47. The two-to-three-year timeline relates to 'first flight and integration,' Taiclet added, noting that any upgrades would have to be phased into production gradually 'because you cannot introduce too much new equipment or too much new software at once, necessarily without interrupting the production flow.' As for the kinds of technologies being considered, Taiclet specifically mentioned new infrared and radar coatings applied on the surface of the aircraft. The implication here is that sixth-generation stealth coatings developed under the NGAD program could be applied to the existing F-35 airframe for an improvement in its low-observable qualities, and likely also its maintainability. The U.S. military has also been observed conducting secretive tests of new mirror-like coatings on F-35s, as well as F-22 Raptor and F-117 Nighthawk stealth jets, in recent years. Taiclet also raised the possibility of more invasive design changes that would address parts of the F-35's core structure. 'There have been some adjustments or learnings, I'll say, on outer mold line, which is the actual shape of the aircraft itself, especially with regard to engine inlets and outflow nozzles that we might be able to again improve on the F-35 without redesigning it,' the Lockheed Martin CEO explained. Engine intakes and exhausts are some of the most sensitive areas for low-observable (stealthy) aircraft. The F-35's rear aspect radar signature is a known weak spot of the design, and improvements here would clearly be welcome, especially as enemy air defenses become more potent. 'There's also electronic warfare improvements, networking improvements, and autonomy,' Taiclet added. Of these, autonomy is judged as being 'really critical' and would be the factor that could make the F-35 pilot optional. Since a lot of the work on autonomy has already been done, Taiclet thinks that a pilot-optional version of the F-35 could become a reality 'over a relatively modest timeframe.' Lockheed Martin's chief executive did not elaborate on what might be required, technically, to add pilot-optional capability to the F-35, but it does seem readily feasible given the aircraft's digitized, open architecture avionics and communications suite. At the same time, the benefits that a pilot-optional F-35 might offer would seem to be of debatable value. The F-35 is also already set to get major electronic warfare enhancements and more as part of the forthcoming Block 4 upgrade package, which we will come back to later on. Finally, in terms of bringing NGAD technologies into the F-35, Taiclet mentioned the possibility of introducing unspecified weapons that have been developed, or which are in development, for the sixth-generation fighter. With some or all of these new technologies, Lockheed Martin sees the opportunity to transform the F-35 into what Taiclet described as 'a more capable fifth-gen-plus version' of the Joint Strike Fighter. The idea of a reworked F-35 is something that Taiclet had raised back in April, soon after Boeing was selected as the winner of the NGAD crewed fighter competition, with its F-47. At the time, he had discussed a 'Ferrari' or 'NASCAR upgrade' for the F-35, but did not provide concrete details of what that might entail. He did, however, note a goal of offering 80-percent of the capability of the NGAD crewed fighter capability at just half the cost. Yesterday, Taiclet reiterated the 80 percent/50 percent target, which remains highly ambitious. 'That's a set of targets that we're going after as a company,' he said. 'We're recommending consideration of some of those ideas to the U.S. government right now.' Absent from Taiclet's conversation yesterday was the so-called F-55, a purported development of the F-35 that U.S. President Donald Trump mentioned while talking to the press earlier this month. Trump described the F-55 as a twin-engined F-35 and also discussed an 'F-22 Super' that would be an upgraded version of the Raptor. At yesterday's Strategic Decisions Conference, Lockheed Martin's Taiclet did say that a similarly ambitious upgrade effort to the one described for the F-35 could be applied to the F-22. The F-22 fleet is already set to receive a number of important upgrades in the coming years, including a new Infrared Defensive System (IRDS), additional sensor improvements, and stealthy drop tanks. Work to modernize the Raptors had already been feeding into the NGAD program. It's also worth noting that President Trump had raised the prospect of an F-55 while on a trip to the Persian Gulf region, raising the question about whether it might have been tied to interest from the countries in the region. Earlier this month, Reuters reported that Saudi Arabian officials had again met with their American counterparts about the possibility of purchasing F-35s. The United Arab Emirates (UAE) and Qatar have reportedly sought to buy Joint Strike Fighters in the past, as well. Concerns about the erosion of Israel's so-called 'qualitative military edge' and operational security issues are reported to have hampered progress on such sales in the past. The Israeli Air Force is currently the only F-35 operator in the Middle East. It's also interesting to note here that Qatar and Saudi Arabia both played significant roles in Boeing's development of versions of the Advanced Eagle, which the U.S. Air Force is now benefiting from with its F-15EX Eagle II. Now, 'in air superiority, there's a discussion about a path to fifth generation in Saudi Arabia,' Taiclet said yesterday. 'There'll be multiple steps in that. It could take some time, but I think if we can work with Saudi Arabia, Qatar, and the UAE on really bolstering their air superiority capabilities and their integrated air and defense capabilities … there will be really significant opportunity for the company along those lines, and a few others too.' It's not entirely clear from Taiclet's remarks here if he means there might also be a pathway emerging for potential 'fifth-generation' fighter sales to Qatar and the UAE, as well as Saudi Arabia. New 'air superiority capabilities and their integrated air and defense capabilities' could include sales of advanced F-16s, which are already heading to the region for the Royal Bahraini Air Force, as well as ground-based air and missile defense systems that Lockheed Martin produces. Lockheed Martin has already found significant export opportunities in the Middle East for its Terminal High Altitude Area Defense (THAAD) ballistic missile defense system and the PAC-3 series of interceptors for the Patriot surface-to-air missile system. Taiclet also talked about the potential for F-35 sales to India and re-raised the possibility of selling that country a particularly advanced F-16 derivative called the F-21. Though hard details remain elusive, the Indian Air Force looks to have lost at least some number of fourth-generation fighters in the course of a brief, but intense conflict with Pakistan earlier this month that also put the spotlight on Chinese fighter exports. 'I think the F-16 also has strong legs, if you will, and more [and] increasing interest as we go forward from a number of countries that aren't quite ready for F-35,' Taiclet said. There are 'some countries that could see F-21 or F-16, for India, for example, as a stepping stone to F-35.' 'We've already started with the wing section. So, F-16 wings are co-produced in India for export to other nations,' the Lockheed Martin CEO added. 'We've made commitments to literally the highest level of the Indian government, that should they choose F-21, which is the modernized version of the F-16, that we would initiate production as feasible in India for final assembly of the aircraft, as well as the wings.' Circling back to the F-35, in general, Taiclet also talked yesterday about the ongoing issues with that program. Work on the aforementioned Block 4 package, and the Technology Refresh 3 (TR-3) improvements that the jets have to receive first, continues to face delays. Taiclet blamed issues tied to an upgrade to the Distributed Aperture System (DAS), which is one part of Block 4, as being a major factor. You can read more about the existing DAS, and the threat warning and general situational awareness capabilities it offers, here. 'TR-3 is a technology refreshment, a technology upgrade, from the prior F-35 core processor, which is basically the onboard server computer; a data storage unit, which is much more robust and can hold and process a lot more information; and then a pilot display generator that is the next generation, is more sophisticated, more capable,' Taiclet explained. Then there is 'a software package, or firmware package, really, that integrates the core processor server, the data storage unit and the display, display generator, into the aircraft itself.' 'The hardware is complete. It's being produced at scale at L3Harris. The software integration with the aircraft is also complete, and so TR-3 has met its completion milestones. What's going on now is that aircraft are being run through the factory with TR-3, plus the first hardware component, or one of the initial hardware components, of the Block 4 upgrade to the aircraft hardware,' he continued. 'That piece of equipment is called a Distributed Aperture System, which is six apertures or antennas located around the aircraft that provide lots of sensing capabilities.' 'The holdup now is that the sensor set — a new piece of hardware and its own software and its own firmware — has to now integrate with the TR-3 aircraft, and that is a little bit behind schedule,' he added. 'Once that catches up, we think by the end of this year, then all those aircraft that have been delivered will be combat-capable.' The ongoing struggles with Block 4 and TR-3 do raise further questions about the fifth-generation-plus F-35 proposal, which involves relatively drastic changes to the aircraft beyond what is being worked on now, as well as the 80 percent/50 percent claim. There are also ongoing supply chain and other sustainment problems that present serious cost growth concerns for current and future operators, something TWZ has explored in detail in the past. 'Our first priority is the health of the F-35 program. What we suggested is longer-term production and sustainment agreements … where we could stabilize the supply chain, get some costs down, and make sure that we can deliver on time and on schedule more reliably,' according to Taiclet. It remains to be seen whether a fifth-generation-plus variant or derivative of the F-35 ultimately materializes. At the same time, Lockheed Martin at least working toward that end could provide the U.S. military a hedge against delays or other issues in the continued development of the F-47. The future outlook for the U.S. Navy's F/A-XX next-generation stealth fighter is currently murky, as well. The F-35 presents is an in-production design that can be leveraged, potentially even just in name. As a comparative example, the Navy first fielded the F/A-18E/F Super Hornet, a significantly different aircraft from preceding F/A-18 Hornet variants, after the cancellation of far more advanced, expensive, and entirely new designs. Regardless, Lockheed Martin looks committed to seeing how far it can push the bounds of the design, including possibly removing the pilot from the equation, as it pursues new export opportunities. Contact the author: thomas@
