Amid Big F-35 Deal, P&W Sees Challengesc

May. 26, 2013 - By AARON MEHTA – Defense News

WASHINGTON — Pratt & Whitney has signed a $1 billion contract for the fifth batch of F-35 Joint Strike Fighter engines and expects to sign a sixth contract shortly, according to the company’s head of military engines.

The low-rate initial production (LRIP) contract with the US military includes 35 jet engines — 32 for installation and three spares — as well as sustainment, support and spare parts. The engines will power 22 of the F-35As for the US Air Force, three of the jump-jet F-35Bs for the Marine Corps and seven F-35C carrier variants for the Navy. Through the first four LRIPs, Pratt has delivered 98 engines to the F-35 program.

“We were able to close the LRIP-5 contract for about a 6 percent price reduction relative to LRIP-4, so we continue to get good cost reductions,” Bennett Croswell, president of Pratt’s military engines division, told Defense News last week.

As part of the contract, Pratt has taken on 100 percent risk on cost overruns, a move Croswell described as proof “we have confidence in our ability to hit the cost targets.” He also said that taking on risk may facilitate the signing of LRIP-6, which he hoped would be done “soon.”

During the interview, Croswell highlighted Pratt’s “War on Costs,” a 2009 plan to bring the price of the high-tech F-135 engine down to that of the older F-119 design, despite significant upgrades to thrust and weight.

Since the delivery of the first production representative engine, costs on the F-135 have dropped by 40 percent, Croswell said. Those cost savings are also seen in the contract for LRIP-5, which saw a 6 percent drop in cost from LRIP-4.

Despite two well-publicized engine problems this year, Croswell said he believes the relationship between Pratt and the Pentagon’s F-35 Joint Program Office (JPO) is strong.

“I think we have a great relationship with [Air Force Lt. Gen. Christopher Bogdan, the head of the JPO], and as long as we continue to deliver, I suspect we will continue to have that relationship.”

In January, the Marine Corps’ F-35B variant was grounded following an engine problem during a test flight. The source of that problem was later identified as an improperly crimped line in the fueldraulic system. Nine days after the jump-jet variants were cleared to resume flights, the entire JSF fleet was grounded when a crack was discovered in one of the blades in the Pratt-designed engine. The following week, Bogdan heavily criticized both Pratt and Lockheed for “trying to squeeze every nickel” out of the program.

“I think the JPO customer is satisfied with how we handled the situation. Gen. Bogdan makes great points. He thinks that contractors should accept more risk on the program. I agree with him,” Croswell said, pointing to Pratt’s internal investment of $60 million of its own money as an example of how the company has taken on some of that risk.

Engine Sales

Despite the movement on F-135 sales, Croswell said the company knows there are challenges on the horizon.

A series of decisions to push F-35 purchases to the right has halved expected F-135 sales since 2009. Combined with the end of production on the F-119 and slowed sales on the F-117 and F-100 engines, the company is facing a production gap Croswell referred to as a “bathtub.”

He expects a total of 75 engine sales in 2015. While that number should increase in later years as F-35 sales grow, it leaves the company in a tricky situation of planning for the future while in a low period.

To help bridge that gap, Croswell said Pratt is looking for ways to use existing engine designs for new platforms.

“A lot of the newer platforms that are being considered for the future, they’re not going to buy a thousand of them,” he said. “So across the board, we need to find ways to deliver good propulsion capability without large development costs. So we are looking at any off-the-shelf engine we have. We’ll look at our whole suite of engine capability and see what meets the future requirements.”

As an example, he pointed to the Navy’s X-47B unmanned aircraft, which runs on an F-100 jet engine, an older model designed for the Air Force’s F-15 and F-16 fighters.