The well-known goal for the US Air Force’s F-35A variant is to become affordable by meeting the $25,000 cost per flying hour (CPFH) target. We have recently seen the F-35A CPFH quoted at $36,000 in 2021, down from $44,000 in 2019 and $67,550 back in 2014.
That’s definitely trending in the right direction. Less than two years ago in 2019, DCAPE Bob Daigle said the “stretch goal” was to hit $34,000 CPFH, but expected actual costs to be closer to $37,000 by 2025.
Despite all the controversy, including HASC Chairman Adam Smith calling the F-35 program a “rathole“, former acting SecDef Chris Miller calling it a “piece of —“, and CSAF Charles Brown calling it a “Ferrari,” it seems that the F-35A might reach its target.
Note, however, that the $25,000 CPFH target is in Base Year 2012 dollars. That means the 2021 Then Year CPFH figure of $36,000 translates into $30,920 when deflated into Base Year (BY) 2021 dollars. That makes the goal easier to reach.
Methodology
Below, I performed a fairly simple log-linear regression to see if and when the F-35A target will be reached. First, I assume that the cost per flying hour of the F-35A is driven by the US Air Force’s inventory. It was hard to find the cumulative F-35As delivered to the USAF in each of those years. What I did as a proxy was presume that there is a three year lag between production units being authorized and their deliveries. We can quibble about that, but I think this gets you pretty close. By FY2021, the cumulative production units authorized in the Selected Acquisition Report (SAR) was 448, but assuming the 3 year lag, the total inventory is perhaps 282.
Next, I normalize the three F-35A CPFH data points I have (2014, 2019, and 2021) into BY 2012 dollars using the raw GDP Chain-Type Price Index. I then regress the F-35A inventory against its BY12 CPFH in log-space, and project it forward using the production schedule found in the SAR, and put the results back into unit space. (Also, I estimate future inflation at 2.5% annually.)
The results are in the chart below. You can access my Excel workbook here (dated Apr 22, 2021).
Discussion
Based on this extremely over-simplified analysis, the F-35A might reach the $25,000 CPFH target by 2025. This seems to validate the JPO’s 2019 estimate that its cost reduction program would achieve $25,000 by 2025. In Then Year dollars, however, the F-35A’s CPFH never hits the $25,000 target. In fact, CPFH costs start creeping up towards the end of the 2030s due to the effects of inflation.
Take this with a grain of salt. It’s hard to know what’s really going on from the outside. But there you have it — the simpleton’s forecast of F-35A cost per flying hour. I don’t think anyone expects the Marine Corps’ F-35B STOVL or Navy’s F-35C CTOL variants to reach affordability any time soon. We will see what that means for the future of the program. Here is some more analysis on maintenance cost across the three F-35 variants.
On April 22, 2021, there was a HASC hearing on F-35 accomplishments, issues, and risks. There was some interesting discussion I’ll blog on shortly.
In the HASC April hearing on the F-35 they mentioned a couple of other F-35A ($2012) CPFH figures: $41,300/hr for 2017, $37,000/hr for 2019, $33,300/hr for 2020. Check out 1:42:45 for the 2017 & 2020 figures, or 2:37:05 for the 2019 and (again) 2020 figures: https://www.youtube.com/watch?v=jhhUK2eYfb4
Awesome thanks for the heads up! I wrote this ahead of the hearings but have been meaning to go back and listen to them. Just using those three figures from 2017, 2019, and 2020, the model now estimates the $25K mark wont be reached until 2029. That’s mostly because it is missing data from the earlier years where it was really expensive, creating a steeper curve.
It’s also interesting these figures are coming from Lockheed Martin. Obviously, they aren’t the operators. The CPFH data should be coming from AFTOC. So DoD analysts told Lockheed what that cost was, and Lockheed tells the world, but DoD won’t say it out loud? [Update: yes, at 2:37:00 General Fick talks about cost]