from the selling-lemons dept.
Lockheed Martin Corp is in the final stages of negotiating a deal worth more than $37 billion to sell a record 440 F-35 fighter jets to a group of 11 nations including the United States, two people familiar with the talks said.
This would be the biggest deal yet for the stealthy F-35 jet, which is set to make its Paris Airshow debut this week.
The sale represents a major shift in sales practices from annual purchases to more economic multi-year deals that lower the cost of each jet.
The pricing of the jets was still not final, though the average price of the 440 jets was expected to be $85 million, the people said on condition of anonymity because they were not authorized to discuss the negotiations publicly.
The multi-year deal for the fighters will consist of three tranches over fiscal years 2018-2020.
[...] Last week, representatives from 11 F-35 customer nations met in Baltimore, Maryland to discuss terms and toured a Northrop Grumman Corp (NOC.N) facility in Maryland that provides equipment for the jet. Those nations included Australia, Denmark, Israel, Italy, Japan, the Netherlands, Norway, Turkey, South Korea, Britain and the United States.
Overall fleet-wide monthly availability rates remain around 50 percent, a condition that has existed with no significant improvement since October 2014, despite the increasing number of new aircraft. One notable trend is an increase in the percentage of the fleet that cannot fly while awaiting replacement parts – indicated by the Not Mission Capable due to Supply rate.
[...] Total acquisition costs for Lockheed Martin Corp.'s next-generation fighter may rise about 7 percent to $406.5 billion, according to figures in a document known as a Selected Acquisition Report. That's a reversal after several years of estimates that had declined to $379 billion recently from a previous high of $398.5 billion in early 2014.
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