Italy Government Coalition Averts Split Over F-35 Jet Purchase (excerpt)
(Source: Reuters; published June 26, 2013)
ROME --- Italy's ruling coalition averted a split over a motion to scrap its purchase of 90 Lockheed Martin F-35 fighter jets on Wednesday by agreeing to seek parliament's approval before going ahead with further spending on the program.
The awkward right-left governing bloc, formed two months ago to end a political stalemate that followed February's deadlocked national election, risked fragmenting over a vote to pull out of the fighter program first agreed more than a decade ago.
The lower-house motion, presented last month and supported by opposition groups and some members of Prime Minister Enrico Letta's center-left Democratic Party (PD), was gathering further support in the PD even as late as Tuesday, the eve of the vote. (…/…)
After a two-hour meeting on Wednesday, the ruling parties came up with a new motion that the government then supported.
The new motion called on the government to push for further integration of European Union defense projects to reduce costs, and says it should seek the support of parliament before advancing to further stages of the fighter purchase. (end of excerpt)
(Click here for the full story, on the Reuters website.
(EDITOR’S NOTE: The above story is not quite right, and the compromise motion is more complicated than it appears.
The literal translation of the motion’s language is
“Regarding the F-35 program, the government commits itself not to proceed with any further acquisition if Parliament has not ruled on the issue.”
This means that, while the government has avoided a vote to pull out of the program, and while Parliament has approved acquisition decisions made to date, it will subject future decisions to much closer scrutiny.
This is expected to focus on prices, as large minorities in government and in Parliament oppose paying up to 12 billion euros in a single program that will, in reality, benefit mostly one single company, Finmeccanica, at a time when Italy is starved of government investment.)
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I
taly Pays $200.3M for Each of its First F-35s
(Source: defense-aerospace.com; published June 27, 2013)
PARIS --- On June 26, just before the Parliamentary debate, the Italian newsletter Analisi Difesa published a very interesting analysis of what Italy has paid to date for the F-35 aircraft it has ordered. The figures it published were obtained from confidential sources it did not better identify.
It should be noted that these figures do not include R&D costs already paid by Italy, nor the €800m+ cost of building and setting up the Final Assembly and Check-Out (FACO) facility in Cameri, near Turin.
As of mid-June, Italy’s total procurement payments stand at €396.4 million, with another €516 million falling due by Dec. 31. Also coming due this year is a €60.3 million payment for long-lead items on future orders for 7 additional F-35As and the first F-35B STOVL aircraft, for a total of €972.7 million.
This is what this amount has paid for, according to Analisi Difesa:
- LRIP 6: three F-35As for the air force:
Since this order was approved in 2009, Italy has paid €323 million for the three aircraft and their engines and €26.5 million euros for logistic support. Two other payments (an additional €45 million for the aircraft and €68 million for support) come due by Dec. 31, 2013.
In all, Italy will have paid €462.5 million for the first three (LRIP 6) aircraft it is buying, which works out to €154.1 million per aircraft ($200.3 million at current exchange rates).
This is 58% more than the €97.9M unit price that Gen. Claudio Debertolis, Italy’s National Armaments Director, provided to Parliament in December 2012.
In a general discussion of F-35 costs, not specifically related to Italy, Lockheed Martin spokesman Benjamin J. Boling told Defense-Aerospace.com June 25 that aircraft “costs continue to decrease with each successive LRIP lot.” Unit costs for the F-35A had decreased from $78.7 million reported in 2011 to $76.8 million in 2012, he said quoting the Selected Acquisition Reports (SAR) released by the Pentagon.
- LRIP 7: 3 F-35As for the air force:
In 2011, Italy signed an order for Lot 7 long lead items (€47.4 million). Two more payments fall due by December: one for the aircraft and their engines (€314 million) and one for logistic support (€89 million).
- LRIP 8: Italy is buying 4 F-35As in this lot:
In 2012, Italy paid €38.1 million for Lot 8 long-lead items.
- LRIP 9: Italy is buying 3 F-35As and one F-35B for the navy in this lot:
Earlier this year, Italy paid €22.2 million for Lot 9 long-lead items.
To sum up, by December 2013 Italy will have paid €973.2 million towards its first 14 F-35 aircraft, with a similar amount to be paid in future years. This works out to an average of about €138 million (or $179 million) per aircraft.
As we have said before, we recognize that dividing total contract cost by the number of aircraft is an imperfect way of computing average unit costs, but it is the only method available given the way that the Pentagon releases contractual information relating to the program.
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) e uma parte dos Tornados.