Buy to Budget

Audio of this article is brought to you by the Air & Space Forces Association, honoring and supporting our Airmen, Guardians, and their families. Find out more at afa.org

Lockheed Martin agreed to the deferral of a $614 million award fee on the F-35 program, announced Monday by Defense Secretary Robert Gates as part of the Fiscal 2011 budget rollout. Dan Crowley, F-35 program manager for Lockheed Martin, said Tuesday it’s fair for the government to insist on performance and added that DOD is “going toward incentive-based fees” on all contracts. If the company can keep F-35 costs down and hit its marks in flight test and production, it could get the money, Crowley said. He also noted that since the government will take a conservative approach in estimating F-35 costs, if actual costs come in lower, the services could “buy to budget” and actually buy more airplanes with the same money. One thing is for sure, though: No money is going to be added to accommodate higher costs, Crowley said.

Audio of this article is brought to you by the Air & Space Forces Association, honoring and supporting our Airmen, Guardians, and their families. Find out more at afa.org