WASHINGTON (Reuters) - Lockheed Martin Corp (N:LMT) subsidiary Lockheed Martin Aeronautics Co has received an interim payment of $1.28 billion for its 10th contract for F-35 fighter jets, the Pentagon said.
It said in a statement the payment was to ensure there would be no major production delays while the final terms of the contract for 90 F-35 Lightning II jets up to a maximum of $7.19 billion were being finalised.
The award is a modification to a previous Low Rate Initial Production (LRIP) contract and comes after negotiations on the ninth contract for F-35 jets concluded.
The U.S. Department of Defense will continue to negotiate the specifics of LRIP 10 to finalize the contract, a spokesman for the F-35 Joint Program Office (JPO) said.
This order includes 76 F-35A aircraft for the U.S. Air Force, Non-U.S. Department of Defense (DoD) participants and foreign military sales customers; 12 F-35B aircraft for the U.S. Marine Corps and non-U.S. DoD Participants and two F-35C aircraft for the U.S. Navy.
"Once a final agreement on LRIP 10 is reached, the balance of the funding is provided. We appreciate the actions taken by the JPO to ensure delivery of F-35s," a spokesman for Lockheed Martin Aeronautics said.
The F-35 is the Pentagon's costliest arms program. The U.S. Defense Department expects to spend $391 billion to develop the plane and buy 2,443 of the supersonic, stealthy new warplanes, in the coming decades.
Lockheed, and its main partners including Northrop Grumman (N:NOC), Pratt & Whitney (N:UTX) and BAE Systems (L:BAES), have been developing and building F-35s for the U.S. military and 10 allies.