By Mike Stone
(Reuters) - Nearly half of President Donald Trump's 2017 $30 billion supplemental defense budget proposal - $13.5 billion - would go to buy and modernize warplanes, warships and missiles.
Although Congress must approve the request and is likely to make changes, Lockheed Martin (NYSE:LMT) is one of the biggest beneficiaries in the administration's proposal, which includes a request for additional Lockheed F-35 warplanes and THAAD missile defense systems, as well as more Army Blackhawk helicopters made by Sikorsky Aircraft, a Lockheed subsidiary.
The stealthy F-35 Joint Strike Fighter costs $95 million - $123 million per plane, depending on the model. Despite $728 million in savings after Trump complained about its "tremendous cost and cost overruns," it remains the most expensive weapons system ever built.
In a Dec. 22 tweet, before he was inaugurated, Trump had suggested buying more Boeing (NYSE:BA) F/A-18s, which he called "comparable" to the F-35, despite the fact that the F-35 is a stealth aircraft difficult for enemy radar to detect. The 1990s-vintage F/A-18 is not stealthy.
Boeing, however, is the maker of the Apache (NYSE:APA) attack helicopter, which the administration's budget proposal highlighted as a potential additional purchase.
The budget request did not give any specific order quantities for aircraft or missiles.
The proposal also requests money to complete the third version of the DDG-51 Navy destroyer being built by Huntington Ingalls Industries Inc. at Bath Iron Works in Maine. A General Accounting Office report published on Aug. 4 said the Navy "has not demonstrated sufficient acquisition and design knowledge" to provide an accurate estimate of the vessel's cost.
The administration's supplemental request takes the base Pentagon budget for fiscal 2017 to $541 billion, analyst Robert Stallard of Vertical Research said in a report on Thursday.
Congress will likely consider the request before April 28, when the current Defense Department funding expires.
