UK to spend 2.5 billion on F35

The BBC is reporting a purchase of 14 new F35 aircraft by the MOD. A few interesting points in this article.Firstly the purchase price of the aircraft is understood do be GBP 59 million which is a major reduction over our first three aircraft at GBP 154 million.

http://www.bbc.co.uk/news/uk-26124894

Secondly in an attempt to grab the headlines the BBC as with every other media outlet continues to make up figures for the purchase price by lumping in expected support costs as well which, is how a purchase for GBP 826 million becomes GBP 2.5 billion. Seeing this headline I thought this was the announcement for the full 48 aircraft not just the 14 we were already aware of.

The question is why do media outlets feel its acceptable to slap 30 years worth of support contracts onto an initial price for military equipment.

** BEGIN RANT**

Imagine the cost of HS2 is we slapped 30 years worth of staff and maintenance cost’s onto the project or the cost of a MRI scanner if treated in the same way. In the past politicians and civil servants were guilty of this as a big headline figure was better to get the press to report it and it looked like government was doing a good job by spending money,but I feel the media are continuing to pedal these figures on their own and trying to turn a positive news story of reduced cost of F35 into a negative one of military spending too much money in a time of austerity.

I work in the financial industry (obviously the source of all evil in the world) and if I made a claim to a client and exaggerated something by three fold I could not only be fined but could possibly go to jail, yet our media who claim they are the only industry in the UK that cannot be regulated are frequently able to exaggerate claims to try and make news.

I know this is a little off topic however I believe the media or at least parts of it are convincing the public both in the UK and in other countries of the military frivolously spending money well poor hospitals and schools go with out when indeed nothing could be further from the truth.

** END RANT**

If these  figures are accurate I think its welcome news that F35B cost’s are already down to GBP 59 million even though the aircraft is still in low rate initial production. Hopefully this can lead to a bigger purchase in future.

 

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Mark
Mark
February 12, 2014 8:00 am

It’s not 30 years of support thats including price.
That bill will come later

This is the initial package to get the aircraft flying and set up the main base for servicing. It’s entirely consistant with the price quoted to South Korea for there aircraft, or the same thing that’s included with any other aircraft we buy so 2.5 b is it would appear the cost to buy workable aircraft.

Anon
Anon
February 12, 2014 9:31 am

This has been out for a while now. More in depth article here: http://www.janes.com/article/33540/uk-to-approve-bulk-f-35b-buy-in-2017

DavidNiven
DavidNiven
February 12, 2014 9:54 am

cheers Anon,

“The UK F-35 programme is scheduled to seek financial approval for its fifth and final main gate in 2017. At this point the overall cost of the programme will be published,” Dunne noted.

Fedaykin
February 12, 2014 11:39 am

I wonder how they are going to deal with the issue of the initial planned purchase of 138. Lockheed Martin have clearly stated that they are working on the principle that the UK will eventually buy 138 and if that is significantly cut then the work share will have to be looked at.

Whilst a cut in Work share probably wouldn’t hurt Rolls Royce and BAE Systems it would cause trouble with the smaller suppliers down the chain who produce components that can be procured elsewhere.

Challenger
Challenger
February 12, 2014 4:15 pm

@TD

Mark is probably right in saying that £2.5 billion doesn’t represent 30 years of support but is more about entry into service and supply chains, infrastructure and so on.

I share your displeasure though in the way the media does often latch onto a figure which best represents their view on the subject rather than stating the costs clearly. In this case the UK media seems to be generally disdainful of MOD procurement in general and the whole CVF/F35 saga in general (and to be fair with years of delay, cost inflation, twists and turns in our planning and broad confusion over the whole matter they aren’t entirely unjustified). So they slap £2.5 billion into the headline and through the report to pursue or reinforce the opinion on how horrendously expensive and misguided the enterprise is.

To be fair (and i’ll show myself to be slightly leftist here) the BBC are for the large part more impartial and concerned with the facts than most, and the media as a whole is a wide spectrum of quality as well as intention but i still think your point which i have elaborated on stands.

‘I wonder how they are going to deal with the issue of the initial planned purchase of 138. Lockheed Martin have clearly stated that they are working on the principle that the UK will eventually buy 138 and if that is significantly cut then the work share will have to be looked at’

It’s an interesting question, i wonder whether the figure of 138 is non-negotiable or if their is a compromise to be reached. I suspect that we could hold onto our work-share with the initial order of 48 and a firm promise of a second order to follow, the question is when and how many we want to buy vs how many they need to sell to preserve the current arrangement.

I know a lot has changed since late 2010 but Air Marshal Bagwell said it was the RAF’s firm intention to end up with a fleet of 100, although of course that was when they thought it would be F35C and we have yet to pass though 2015 and another SDSR so i really think it’s anyone’s guess.

Anon
Anon
February 12, 2014 4:17 pm

F-35 variants are being studied as part of FCAS, see: http://www.aviationweek.com/Article.aspx?id=/article-xml/asd_08_19_2013_p03-01-607933.xml

JDW reported in 2012 that Hammond had stated that additional F-35s may be ordered after 2030 to replace Typhoon.

Fedaykin
February 12, 2014 4:31 pm

I agree the way forward is staggered batches over the years, it is a reasonable compromise solution and I am sure Lock Mart are expecting the MOD to go down that path. I only see problems if the Government faffs around not giving clear reassurances that is the way forward.

There are advantages not buying all the airframes up front, it keeps the lines open trickling out sub assemblies and we benefit from buying later more mature Blocks with issues ironed out.

Mark
Mark
February 12, 2014 6:02 pm

Martin

No more misleading or correct than any other program we discuss here. I happen to think its not really misleading at all this aircraft requires new infrastructure, it requires new training facilities, it requires software control centre and it require spares and the ground based health monitoring systems to work. These costs are included in every other program we see the nao report on or when fsta, a400m, typhoon, or lynx are discussed here. In fact we should probably add in the 1b or so we’ve already spent on r and d if you want to directly compare to the cost of those program’s. At the end of the day it covers the cash this country will spend for the capability it desires.

If you only buy a plane it is just a big paper weight that’s why the usual cost comparisons are pointless. You only know the cost when you decide to pay for something and this is our cost when we buy f35 it is a very expensive aircraft to buy and operate.

All Politicians are the Same
All Politicians are the Same
February 12, 2014 6:08 pm

@ Mark

“You only know the cost when you decide to pay for something and this is our cost when we buy f35 it is a very expensive aircraft to buy and operate.”

yet one that becomes cheaper and better value every air frame you buy.

Mark
Mark
February 12, 2014 6:21 pm

Apas

Up to a point yes but that is exactly the same with anything we buy.

All Politicians are the Same
All Politicians are the Same
February 12, 2014 6:29 pm

@ Mark, precisely so given the plummeting unit cost the in service arrangements for such a huge Fleet and the requirement to pay up front costs anyway, surely this is even more pronounced for F35?

DavidNiven
DavidNiven
February 12, 2014 6:34 pm

‘better value every air frame you buy.’

Lets not get ahead of our selves, the jury is still out on this.

All Politicians are the Same
All Politicians are the Same
February 12, 2014 6:40 pm

@ David Niven

As it was with F16 F4 and bloody well should have been with F3 but as somebody posted the other day, the P51 was not designed to be what it became and neither was the original P38 or the F4.

DavidNiven
DavidNiven
February 12, 2014 6:47 pm

@APATS,

I agree there are plenty of aircraft that have gone on to excel in roles they were not intended, but as the F35 has yet to do this the or even its primary role ( its not operational yet), I’d say the jury is still out.

Mark
Mark
February 12, 2014 6:51 pm

Apas

There a number of answers to “plummeting” unit costs depending on what you wish to base it against. Infrastructure costs are upfront provided you don’t want to base them in more than one location when you then need to pay for infrastructure again. High numbers only reduce costs so much, then they level out and you continue to pay the same amount where that is on f35 is unknown as well many other things. We are also operating a variant whose global fleet size is similar to the ones we currently operate.

Observer
Observer
February 12, 2014 7:05 pm

Mark, but isn’t that infrastructure cost independent of the F-35? Can’t say that it’s the F-35’s fault if for example the UK gets the F-16 (ok, you guys can stop laughing now, it’s just an example) and you have to get the same infrastructure change too. In that case, it’s the fault of having a new plane in service, be it an F-16, F-35 or even a Taranis.

Mark
Mark
February 12, 2014 7:35 pm

Observer

New infrastructure is required for any aircraft you buy yes, but this one requires more than most due to what it is and how it goes about its operations. If I want to operate f35 I have to buy the infrastructure, the alis system, the software centre, the radar signature measurement and repair systems, upgrade my facilities to support the electrical demands of this aircraft and have special facilities in place for the new battery systems on the aircraft, I have to modify the airfield to meet the vertical landing demands of this aircraft and to set up the enhanced simulator systems this aircraft will train on, and the deployed ones that will follow it to the place of operation.

I’m not sure why this a contentious issue this is the reason you limit your fleet types to avoid this very expense but it is an expense that needs to be paid to operate this aircraft and so should be counted against what we budget to acquire and operate it. I really don’t know why people want to exclude that from this contract order.

All Politicians are the Same
All Politicians are the Same
February 12, 2014 7:39 pm

@Mark
Welcome to the 21st century (I know only the RAfs second one but for those with traditions instead of habits), the days of adjusting your scarf and kicking the tyres are forever gone. Do you really need to shorten the runnway for vertical landings? :)

Mark
Mark
February 12, 2014 8:10 pm

Apas

Ha well they wouldn’t be biggles without the scarf and goggles. Off course they need to shorten the runway to keep the tree huggers happy for the increased noise! but you’ll need the hover pads they had a wittering for harriers ect.

Observer
Observer
February 12, 2014 9:15 pm

I did hear that they needed to heat proof LHA’s flight decks to withstand the heat from the F-35B, but this is the first time I’ve heard that they need to heat proof runway tarmac too….

mike
mike
February 12, 2014 9:41 pm

@ APATS

lol well, the FAA still has Habits then, considering its sprightly age…especially its modern 1930’s reboot ;)
And the submarine service! Hated by the rest of the fleet for some time…

I dont think these will equip an operational squadron, likely will form most of the OEU – 17Sqn – and then the OCU (I still say a flight within a USMC sqn would be better for the start) but its something… but all such news should have the small print – “subject to terms and conditions of political football and 2015”.

As for infrastructure, I still say we should have a ground training rig for carrier ops, a land based mock up with ramp… like we had at Wittering/Cottesmore and Yeovilton, and of course…eco-freindly hover pits :D

Observer
Observer
February 12, 2014 9:51 pm

Mark, look closer. There is no accredited source that said that normal runways could not take the heat and had to be retrofitted, just that new heat resistant pads were to be built for VTOL. You can skip it totally and it still won’t affect ops. Just do STOL.

Mark
Mark
February 12, 2014 10:06 pm

Observer

Read closer what I wrote I said they would need hover pads like they had for the harriers at wittering and that’s exactly what they will be doing.

H_K
H_K
February 12, 2014 10:23 pm

GBP 59 million… hmm, sounds about right WITHOUT the engine, retrofits, and VAT.

Latest F-35B unit prices for LRIP 7 (2015 delivery):
$104 million – airframe only
$146 million – with engine and retrofits
$175 million – incl. VAT

i.e. GBP 105 million! Inching down slowly (3-4% per batch), but still 50% more than Typhoon (GBP 72 million).

Elm Creek Smith
Elm Creek Smith
February 12, 2014 10:33 pm

The RAF/MoD decided that the aircraft that replaced the Harrier must have STOVL capabilities, right? That meant the F-35B version of the JSF. Without that capability as a given, the F-35A or F-35C for the RAF and the F-35C for the FAA (Do they still call it that?) would make much more sense with much greater load-carrying/range capability. Of course, that would mean the QE and POW(PoW?) would have to be conventional carriers. I can understand the US Marine Corps requirement for an STOVL aircraft, but I have my doubts that the RAF/FAA does, especially when they aren’t going to be supporting the BOR against hordes of SGFG tanks anymore.

John Hartley
John Hartley
February 12, 2014 10:59 pm

ECS. I keep looking at the model of the 59,000 ton Super CdG, the French wanted to build as their second CVN circa 2004. Two of those for the RN would have been a better choice than the Obese Stovl elephants we are stuck with.

Overseas
Overseas
February 12, 2014 11:29 pm

See that ad for the Outlander SUV? That’s why the headline is the way it is. Click bait, nothing more.

And yes, the (multi-headed evil all encompassing) media is spinning the info they are provided to meet their editorial guidelines. BBC do it just the same as everyone else, don’t be naive to think otherwise.

Think Defence
Admin
February 12, 2014 11:36 pm

ECS, as you can imagine the F35/JSF/JCA debate has been done to death on Think Defence

To get the background and rationale, you could try these

https://www.thinkdefence.co.uk/2013/01/looking-forward-to-an-f35-future-part-1-introduction/

This one goes to 5 parts

And this is a general search link

https://www.thinkdefence.co.uk/index.php?s=F35

plus a few selected posts

https://www.thinkdefence.co.uk/2012/05/making-sense-of-the-f35-decision/
https://www.thinkdefence.co.uk/2010/09/i-am-puzzled/

And my all time favourite

https://www.thinkdefence.co.uk/2012/03/the-f35-and-mod-credibility/

Should only take you a couple of thousand years to wade through that lot :)

Observer
Observer
February 13, 2014 4:16 am

TD, done to death? You’re too kind. If the topic was a cat, he would have been on life 8 or 9 by now. :)

On the bright side, there is light at the end of the tunnel and we’re finally going to get practical demonstrations of how it can screw up in service (took them long enough) instead of doom and gloom predictions. I blame Gloomy for all the gloom. :P

“F-35 runs aground on sandbank.”

Mark
Mark
February 13, 2014 7:54 am

Martin

Because the uk government has not purchased voyager it is merely renting a service there is no up front cost.

Second the r and d budget for the civil a330 be it repayable loans or whatever does not come from the MOD budget so is irrelavent to uk defence. Money paid for development did for f35.

a
a
February 13, 2014 1:51 pm

The question is why do media outlets feel its acceptable to slap 30 years worth of support contracts onto an initial price for military equipment.
Imagine the cost of HS2 is we slapped 30 years worth of staff and maintenance cost’s onto the project or the cost of a MRI scanner if treated in the same way… I feel the media are continuing to pedal these figures on their own and trying to turn a positive news story of reduced cost of F35 into a negative one of military spending too much money in a time of austerity.
I work in the financial industry…

Ah, yes, if only BBC defence correspondents conducted themselves with the same scrupulous honesty and probity that we see in the financial industry!
I wonder which bit of the industry in particular they should try to emulate? The bit that was deliberately lying about Enron being a massive fraud, in order to keep earning fees from Enron? The bit that was marking up securities prices in order to rip off its customers? The bit that was hand in glove with Bernie Madoff and refusing to raise the alarm about his deals with them? The bit that was laundering money for the Mexican drug cartels? The bit that was lying about subprime CDO ratings? The bit that was conning its customers into buying unnecessary insurance or rate hedges? Or maybe the bit that was conspiring to rig every index it could in order to screw over its counterparties? So many options!

Fedaykin
February 13, 2014 4:53 pm

Actually it should be noted that the press HAS been slapping the maintenance and staffing costs onto any reports about the cost of HS2.

Repulse
February 13, 2014 6:54 pm

http://www.theguardian.com/politics/defence-and-security-blog/2014/feb/12/armed-forces-defence-army-navy

Lovely bit of Navy bashing also going on at the moment… If only the F35Bs belonged to the Navy :)