Lockheed Martin F-35 Deal: What the 850-Jet Framework Covers

The U.S. Department of War and Lockheed Martin have agreed a framework under which the company is set to build 850 F-35 Lightning II fifth generation fighters for the U.S. Armed Forces over ten years, a significant departure from the lot-by-lot negotiations that have repeatedly held up contracts for the program. The framework, announced jointly on October 22, covers production Lots 21 to 30 alongside initial spares, ten years of modification kits and sustainment, and orders from international clients, with output to be held at 156 aircraft per year across all customers. Neither party disclosed a value, and the agreement is not itself an order, since it depends on Congress granting multiyear authority and the funds to match. It reflects a wider shift towards long-term commitments for the Pentagon’s most important weapons, following a seven-year $58.62 billion contract for PAC-3 MSE interceptors awarded to Lockheed in July.

The 850 American jets work out to an average of 85 a year, the figure Lockheed Chief Executive Jim Taiclet indicated in July the Pentagon wanted, which leaves roughly 71 places a year for foreign operators. The department stated that Lockheed will self-fund at least $7 billion in initiatives supporting the program, with Taiclet stating: “This multiyear framework strengthens the way we can plan and invest in the F-35 enterprise.” The announcement follows a protracted negotiation over the previous batch, with the $24.3 billion contract for 296 aircraft across Lots 18 and 19 only finalised on September 29, 2025, at an average of around $82.4 million per airframe excluding the F135 engine by some estimates. Talks on Lot 20 remain unresolved, and Lockheed’s third quarter results released the same day confirmed that its costs on the Lot 20 advance acquisition contract had begun to exceed the funding the government had authorised.

The framework is expected to underpin the U.S. Air Force’s plans to field 1,509 combat-coded fighters by 2035, with the F-35 to form around 40 percent of that fleet. Demand from abroad has also grown considerably, with Saudi Arabia’s purchase of 48 F-35A jets clearing congressional review on October 17, and with more than 1,375 F-35s now fielded from 42 bases worldwide according to Lockheed. Deliveries have nonetheless been uneven, with Lockheed handing over a record 191 aircraft in 2025, a total inflated by jets held in storage during software delays, but only 94 in the first nine months of 2026 against 143 over the same period a year earlier. Both chambers’ versions of the fiscal year 2027 National Defense Authorization Act reportedly include multiyear F-35 provisions, although the bill has yet to become law.

The F-35’s main weakness remains its upgrade path rather than its production rate, with the Technology Refresh 3 hardware upgrade and the Block 4 capability package it is meant to enable both significantly delayed, according to a Government Accountability Office report from September 2025. Deliveries of TR-3 aircraft resumed in July 2024 with truncated software, and the jets have since been restricted to training while the F-35 Joint Program Office withholds a declaration of combat capability. The Pentagon’s Director of Operational Test and Evaluation reported that by the end of September 2025 a total of 812 F-35s in all configurations had been delivered to the U.S. services, of which 158 were TR-3 aircraft, with none of them yet cleared for combat.