Lockheed may shift F-35
fighter work away from Canada
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[June 10, 2016]
By Andrea Shalal
BERLIN (Reuters) - Top U.S. weapons
maker Lockheed Martin Corp is studying whether to shift work on its
multibillion-dollar F-35 fighter jet away from Canadian firms given
uncertainty about Ottawa's plans to buy the jet.
Jack Crisler, Lockheed's vice president of business development for
the F-35 program, told Reuters Lockheed was under pressure from
other partner countries that had placed firm orders or accelerated
orders to shift more work to them.
"This is not anything punitive. It is just business," he said in a
telephone interview from the Netherlands, where the F-35 will fly in
its first international air show on Saturday.
Canadian firms will account for development and production work on
the F-35 program worth about $1 billion by the end of 2016, Crisler
But future work could be in jeopardy if Canada decides to skip a
competition and order F/A-18E/F fighter jets built by rival Boeing
Co <BA.N>, as indicated by recent Canadian media reports, he said.
A spokeswoman for Canada's defense ministry said the reports were
not accurate, but gave no further information.
Crisler said Lockheed had been unable to secure a meeting with the
Canadian government to discuss the issue.
He said F-35 supply chain contracts were competitively awarded in
rough proportion to the purchase plans of the nine original partner
countries that helped fund development of the radar-evading jet: the
United States, Britain, Canada, Turkey, Italy, Norway, the
Netherlands, Australia and Denmark.
Canada's ruling Liberals won an election last October on a promise
not to buy F-35s because the planes were too expensive. Prime
Minister Justin Trudeau told the House of Commons the opposition
Conservatives had "clung to a plane that does not work and is far
from being able to work."
Joe DellaVedova, a spokesman for the Pentagon's F-35 office, said
Canada remained a partner in the $379 billion program, and U.S.
officials continued to provide the Canadian government information
about the jets as they decided how to proceed.
More than 180 of the new jets are now flying, including an initial
squadron of U.S. Marine Corps F-35 jets that were declared ready for
combat a year ago, he said.
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An F-35A Lightning II Joint Strike Fighter takes off on a training
sortie at Eglin Air Force Base, Florida in this March 6, 2012 file
photo. REUTERS/U.S. Air Force photo/Randy Gon/Handout
Crisler said if Canada held an open competition, Lockheed would retain contracts
with Canadian firms, but it would need to rethink if Ottawa opted for a
sole-source deal with Boeing.
"We are evaluating all that now," he said. "The most important thing is that
we've got to protect the enterprise as we get ready to ramp up production."
Sixty Canadian firms had worked on the F-35 development program, and 70 others
are now involved in production of the jets, including Magellan Aerospace <MAL.TO>,
Canadian firms involved urged Ottawa on Thursday to hold a fair and open
competition to replace its aging fleet of CF-18 fighter jets. Their supply
contracts, they wrote in the joint statement, were contingent on Canada buying
"Not selecting the F-35 will set off a chain of events that will see hundreds of
millions of investment dollars lost, and high-tech jobs leaving Canada, going to
countries who are buying the F-35," they said.
(Additional reporting by David Ljunggren; Editing by Mark Potter)
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