Pentagon, Lockheed agree to 10-year deal for 850 F-35 jets

The Defense Department and Lockheed Martin agreed to a 10-year framework that the Pentagon says guarantees at least 850 F-35 Lightning II fighters for the U.S. military, pending congressional approval and funding.

The framework, announced Thursday, includes initial spare parts plus 10 years of modification kits and sustainment. It also covers orders from foreign customers, with production continuing at 156 aircraft per year, according to Lockheed.

In exchange for the decade-long commitment, Lockheed will self-fund at least $7 billion in initiatives supporting the F-35 program, the Pentagon said.

“With the greater certainty that comes from the U.S. government’s transformative approach to F-35 production and sustainment, we can make the upfront investments needed to expand capacity, improve efficiency, and build a more resilient supply chain,” Lockheed CEO Jim Taiclet said in a statement. “That’s good for the taxpayer, good for our suppliers and, most importantly, good for the United States and its allies.”

Neither announcement gave a total value or per-jet price. Lockheed said the F-35 Joint Program Office and the company will work out terms, pricing and schedules in a formal contract if Congress approves a multiyear buy and provides the money in the coming months.

A multiyear buy lets the Pentagon purchase a weapon across several years under one contract instead of negotiating annually, which generally lowers unit cost. Lockheed said the framework is expected to save taxpayers billions of dollars through “long-term pricing and industry volume discounts.”

“We have fundamentally changed how we stabilize the American defense industrial base to produce at speed and scale,” said Michael Duffey, the Pentagon’s undersecretary for acquisition and sustainment. “This agreement with Lockheed Martin proves it. By aligning financial incentives with actual performance, we are ensuring our warfighters are equipped with the lethal capabilities they need to fight and win.”

Neither the Pentagon nor Lockheed described those performance-based incentives.

At 850 jets over 10 years, the framework averages 85 U.S. aircraft per year. That matches the Pentagon’s fiscal 2027 request for 85 F-35s across the services. In fiscal 2026, Congress funded just 47 F-35s.

The framework comes days after the Air Force told Congress it needs 1,509 combat-coded fighters, or jets assigned to combat units, by 2035. The request came in a force structure report sent Oct. 16. F-35As would make up about 40% of that fleet.

The House and Senate versions of the annual defense policy bill would both let the Pentagon sign multiyear F-35 contracts. The House passed its bill in July. Senate Democrats blocked theirs from reaching the floor that month, and leaders have put it off until after the November midterm elections. The framework can’t become a contract until both bills pass and are merged into a single law.

The framework also faces a funding hurdle. Congress has not yet approved a full-year defense budget. A stopgap funding law keeping the government open through Dec. 11 holds spending at last year’s levels and generally bars the Pentagon from starting new programs or multiyear buys.

Lockheed pitched the framework as a readiness fix, saying steady orders will improve the F-35’s mission-capable rate, the percentage of time jets can fly at least one assigned mission.

“Predictable demand from long-term contracts with suppliers will enable bulk procurement of raw materials and critical parts, slashing turnaround times and reducing logistics bottlenecks,” Lockheed said. “This will result in better mission-capable rates by eliminating the annual contracting cycle that has historically strained the industrial base.”

A Government Accountability Office report in June found that the rate fell from 67% in fiscal 2021 to 44% in fiscal 2025, while the share of time jets could fly all assigned missions dropped from 38% to 25%. Later that month, F-35 program chief Lt. Gen. Gregory Masiello told senators the fleet had outgrown its support system.

The F-35 deal follows a string of Pentagon framework agreements aimed at speeding up weapons production.

In January, Lockheed reached an agreement to speed PAC-3 MSE output, then signed another weeks later to quadruple THAAD interceptor production. The THAAD deal led to a contract worth more than $35 billion in June. Last year’s defense bills had already approved multiyear buys for both interceptors.

On Oct. 19, the Pentagon announced a framework with BAE Systems covering up to seven years of buys of Advanced Precision Kill Weapon System laser-guidance kits.

Lockheed said the program will support 317,000 U.S. jobs and roughly $79 billion in yearly economic activity over the decade.