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Lockheed to Continue Support for the F-22

Update – Lockheed Martin put out a statement earlier today that the award was not a new contract but an addition to their existing one that raised the ceiling to the $7.4 billion amount.

One of the advantages that the OEM for a defense systems has is that they have the ability to win the majority of work on a produced and fielded articles. This is especially true for aircraft. The U.S. and many other countries rarely buy full technical rights to a defense program now due to the cost. This means that they have to rely on the OEM for modifications, improvements and other support.

In this vein, Lockheed Martin (LMT), the primary contractor on the F-22 Raptor fighter program just received a long term contract form the U.S. Air Force to provide this kind of effort for that fleet. Lockheed has delivered over 100 of the 5th Generation fighter aircraft and continues to produce them now although the U.S. is not ordering any more.

The contract has a value of over $7 billion and will allow system upgrades and performance improvements. As with many of these contracts it was sole source.

In the past the military has taken aircraft and helicopters into their maintenance and support systems. When BRAC started in the 1990’s one of the first areas targeted were the large depots and shipyards owned by the government. Many of these were closed and the work turned over to contractors either at their facilities or the former government ones. Many times contractors are hired to work at existing government facilities as well.

The F-22 while it is the most advanced combat aircraft in the world has had some recent problems. Along with many U.S. aircraft there were found to be issues with its Onboard Oxygen Generating System (OBOGS). This lead to the fleet being grounded while work was done to solve the issue.

Lockheed will work under this contract on improvements to the aircraft which could be new engines, electronics, software and integration of weapons as the fleet ages. It could also look at maintenance, reliability and availability enhancements. These contracts are not uncommon especially as production begins to wind down. They represent a good way for a company to continue making earnings and revenue off of a system in service.

Photo from Rob Shenk’s Flickr photostream.

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