May 20, 2020

Lockheed to Miss 2020 F-35 Production Goal Due to COVID-19

Production of the F-35 fighter in 2020 will be up to two dozen aircraft short of the planned 141 jets, due to a reduced flow of parts and a COVID-19-imposed work slowdown, Lockheed Martin announced May 19.

“At this time, we expect to see an impact of approximately 18-24 aircraft,” a company spokesperson said. A slowdown on the production line is due both to “supplier delays” and the need to adjust work schedules and manning of assembly stations to preserve worker safety, he said.

“Lockheed Martin is taking proactive measures to mitigate impacts and position the line for the fastest possible recovery,” the company said. Lockheed is “tapering” the line over a three-month period while “continuing to accelerate payments to small and vulnerable suppliers, adding it expects a “return to pre-COVID-19 production levels in the fall.” The 18-24 jets is a worst-case scenario, and if production of parts accelerates in the next few months, “We could see this number decrease,” the spokesperson said. It’s not clear how many of those aircraft will be F-35As for the USAF.

Financial impacts on the program are “consistent with what we’ve reported previously” and will be shared during the next earnings call, he said. In its April earnings call with investors and analysts, Lockheed projected a $375 million impact on reduced F-35 sales due to COVID-19.

In recent weeks, Lockheed has accelerated $450 million in payments to suppliers to keep parts production moving. Last week, it added another $300 million to that figure, bringing the total to $750 million.