President Donald Trump was a major factor in the cost reductions achieved in the F-35 fighter program, Lockheed Martin CEO Marillyn Hewson said Tuesday.
“We were in discussions … and he helped accelerate that along, and I think he put a sharper focus on price and how we would drive the price down,” Hewson told reporters at a Lockheed media event in Arlington, Va. “So he absolutely did contribute to us getting to closure on that.”
Marillyn Hewson told reporters on Tuesday. https://t.co/fB1vslH8AO
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In an interview with Defense News, she said Trump started with the basics of why the F-35 was needed and then looked at how to procure the plan at the lowest cost.
“He wanted to first understand the capabilities of the systems and spent time with military leadership understanding the actual programs,” Hewson said.
“Then we had a good dialogue about how do we get through the current negotiations, how do we continue to bring the price down, how do we get to a point where we can get to a more economic order quantity — multi-year, block buy, or something like that. He recognizes the capability was needed of the F-35, but he also recognized he wanted to get the best price. I was encouraged by those discussions and continue to be,” she said.
Hewson said Lockheed has set a goal of saving more than $5 billion on the aircraft.
“If you think about his focus and his long-term trend of increasing more spending in national security and on defense spending, the F-35 is the largest program that the Department of Defense has in its budget,” Hewson said. “So for him to focus on the F-35 and to focus on how he can get the best price for the taxpayer going forward, I think, was perfectly appropriate.”
Trump’s initial thoughts on the F-35 were anything but favorable, and tweeted his displeasure with the program in December.
The F-35 program and cost is out of control. Billions of dollars can and will be saved on military (and other) purchases after January 20th.
— Donald J. Trump (@realDonaldTrump) December 12, 2016
In February, however, an agreement was reached in which the cost of the F-35A variant dipped below $100 million for the first time. Hewson said that although the cost per plane was inching lower, Trump made it fall faster and farther.
Trump’s “emphasis and his engagement did absolutely make a difference,” she said.
“Since his election, President Trump has made clear that he and his administration will be focusing on ensuring that the government is a smart buyer, getting the most for the taxpayer’s dollar,” Hewson said. “In our positive and constructive dialogues over the last few months we were able to communicate how Lockheed Martin is fully aligned with these efforts.”
She also said “the President Trump effect” has been indirectly boosting Lockheed’s business by demanding NATO nations increase their defense spending to a level all member nations have promised, but few have met.
She credited Trump with an increased interest by foreign nations in boosting their own defense spending.
“NATO members are considering the shifts of U.S. priorities, and many see a great need to shoulder more of their own defense burdens,” she said. “This is significant. In fact, if NATO members fulfill their own stated pledges to spend 2 percent of their GDP on defense, it could result in a $100 billion increase in spending across the alliance.”
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