In a “landmark” agreement, the Pentagon and Lockheed Martin have agreed to a framework agreement to buy F-35 Joint Strike Fighters for the next 10 years.

Under the multi-year production and sustainment agreement, Lockheed Martin will produce 1,560 F-35 Lightning II aircraft for the US and its international customers at a rate of 156 fighters per year.

The US will buy at least 850 of these stealth fighter jets.

The agreement also covers associated initial spares, 10 years of modification kits, and a sustainment package for the global F-35 fleet.

It creates a stable, long-term procurement signal to modernize and expand America’s 5th-generation tactical aircraft.

However, the agreement’s execution remains subject to Congressional authorization and appropriations.

The US Congress is already considering granting the Pentagon authority to enter into multi-year procurement agreements with defense companies, specifically Lockheed Martin for the F-35 fighter and Boeing for the F-15EX Eagle.

The Pentagon also wants to buy at least 268 F-15EX fighters over the next decade.

The multi-year procurement and sustainment framework was first envisioned in the fiscal 2027 National Defense Authorization bill, released in May.

“We have fundamentally changed how we stabilize the American defense industrial base to produce at speed and scale,” said Under Secretary of War Michael P. Duffey in a statement.

“This agreement with Lockheed Martin proves it. By aligning financial incentives with actual performance, we are ensuring our warfighters are equipped with the lethal capabilities they need to fight and win.”

The Pentagon believes that multi-year procurement agreements, totaling hundreds or even thousands of aircraft and valued at billions of dollars, will encourage defense companies to make upfront investments in expanding production facilities.

Earlier this week, while commenting on the US Air Force’s updated fighter force structure report, under which the force envisions a 1,509 combat-coded fighter fleet by 2035, Lt. Gen. David Tabor, deputy chief of staff for plans and programs, has underlined that pushing multi-year procurement packages will provide financial stability to defense contractors and encourage them to invest in production facilities.

Notably, the US fighter force structure report is also pending before Congress, and it envisions a 60% stealth fleet by 2035.

The 60% stealth force will include 40% F-35s and 20% F-22 Raptors and F-47s.

If the report is approved, by 2035, two out of every five combat-coded fighters in the USAF will be F-35As.

Besides, the US Navy and the US Marine Corps will also fly additional F-35B and F-35C variants of the fighter.

The ten-year procurement framework with Lockheed for 1,560 F-35s over the next decade, including 850 exclusively for the US, will help the company invest in expanding and streamlining its production facilities to meet extraordinary global demand for the F-35.

To meet the demand, Lockheed will have to produce 156 F-35s annually.

Under the framework agreement with the Pentagon, Lockheed Martin has agreed to invest at least US$7 billion of its own money into projects to support the F-35 program.

“This multiyear framework strengthens the way we can plan and invest in the F-35 enterprise,” said Lockheed Martin Chairman, President and CEO Jim Taiclet.

“With the greater certainty that comes from the U.S. government’s transformative approach to F-35 production and sustainment, we can make the upfront investments needed to expand capacity, improve efficiency, and build a more resilient supply chain. That’s good for the taxpayer, good for our suppliers, and, most importantly, good for the United States and its allies.”

Lockheed Martin said in a statement that if the U.S. Congress grants multiyear authority and associated appropriations in the coming months, the F-35 Joint Program Office (JPO) and Lockheed Martin will finalize contract terms, pricing, and schedules through a formal contract award.

The statement added that the framework agreement will offer several advantages, including predictable, multi-year procurement planning, high-volume procurement efficiencies, and transparent, data-driven decision-making.

Notably, the F-35 Lightning II program relies on more than 1,400 domestic and global suppliers and contractors.

According to Lockheed Martin, the company manufactures nearly 30 to 42 percent of the jet outside the US across three continents before final assembly in Texas.

While Lockheed Martin is the primary contractor, the UK’s BAE Systems is a principal partner. BAE supplies much of the software code, the F-35’s rear fuselage, tails, the AN/ASQ-239 Barracuda electronic warfare system, the antenna, various avionics, and more.

Another British contractor, Martin Baker, is providing the ejection seats. The LiftSystem found in the F-35B variant is made by the UK’s Rolls-Royce (the only company building that type of STOVL lift fan).

Northrop Grumman is also a principal contractor, and it designs and produces critical F-35 components, including the center fuselage, AN/APG-81 AESA radar, communications subsystems such as the AN/ASQ-242 Integrated Communications, Navigation, and Identification (CNI) system, and the EO/IR Distributed Aperture System.

Leonardo and Cameri in Italy, GKN Fokker in the Netherlands, ASDAM Group in Australia, and nearly 30 companies in Canada also supply crucial parts for the F-35 fighters.

Over 1,500 firm orders for the F-35 over the next 10 years will allow Lockheed Martin to enter into long-term contracts with these suppliers to buy raw materials and critical parts in bulk, thereby stabilizing supply chains and increasing F-35s mission-capability rates.

It said the integrated procurement model, which pairs aircraft production with purchases of spare and modification parts, will deliver high-volume procurement discounts, drive down unit prices, and give the U.S. government the cost predictability it requires.

Meanwhile, during the October 22 earnings call, Lockheed reported third-quarter 2026 sales of US$20.7 billion, up from $18.6 billion in the third quarter of 2025.

It also reported a record backlog of US$292.0 billion, including US$52.5 billion tied to the multi-year award to produce PAC-3 Missile Segment Enhancement (MSE) interceptors.

Notably, Lockheed Martin’s market capitalization is approximately US$127 billion, so its current backlog of US$292 billion is 2.3 times its market value.

Together, the multi-year agreements for PAC-3 MSE interceptors and F-35 fighter jets will provide Lockheed with a stable source of income for years to come.

If Congress approves the F-35 multi-year procurement framework, Lockheed Martin’s backlog order book could easily cross US$350 billion.

“In the third quarter each of our four segments posted growth year-over-year, sales topped $20.7 billion and net earnings exceeded $1.8 billion, increases of 11% and 14%, respectively. We delivered $3 billion of free cash flow in the quarter, and increased our backlog to a record $292 billion, allowing us to raise our dividend for the 24^th year in a row,” said Lockheed Martin Chairman, President and CEO Jim Taiclet.

Taiclet also reiterated the company’s desire to integrate sixth-generation fighter-jet technologies into the F-35, upgrading it into what he called a “Ferrari” F-35.

Taiclet first voiced this desire in April last year after Lockheed lost to Boeing for the USAF’s Next Generation Air Dominance (NGAD) fighter, the F-47. He claimed that the company can integrate 80% of sixth-generation NGAD technology into its fifth-generation F-35 Lightning II, which is already in production, at half the cost.

If the multi-year F-35 agreement is approved and it provides Lockheed with 1,560 firm orders and stable cash flow over the next decade, then the company can invest in integrating some of these sixth-generation technologies into the F-35.

Notably, the F-35 is already the world’s most popular stealth aircraft.

Lockheed Martin has already delivered nearly 1,300 F-35s to the US and its international customers, more than all other stealth fighters combined, including the US F-22 Raptor, China’s J-20 and J-35A, and Russia’s Su-57.

A firm order for 1,560 more F-35s would bring the total close to 3,000 fighters by 2035.

The final decision, however, rests with the US Congress.

• Sumit Ahlawat has over a decade of experience in news media. He has worked with Press Trust of India, Times Now, Zee News, Economic Times, and Microsoft News. He holds a Master’s Degree in International Media and Modern History from The University of Sheffield, UK. 
• He can be reached at ahlawat.sumit85 (at) gmail.com

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