Murphy's Law: Making The F-22 Too Expensive To Stop Building

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December 8, 2008: The U.S. Department of Defense, the U.S. Congress and the builder of the F-22 fighter are brawling with each other over a clause in the manufacturing contract that awards the Lockheed Martin Corporation $147 million if they have to stop building the F-22 and shut down the manufacturing process (close plants, dismiss staff and terminate contracts with hundreds of supplier firms.) Such a termination payment is not unheard off. Shutting down the manufacturing process for a complex weapons system is expensive, especially if there are long-term contracts in place to obtain many components (which would be a lot more expensive if bought on short term contracts.)

But many military, government and political officials claim that the amount of the cancellation payment is excessive. Apparently the amount was made that large by Congress to encourage building more F-22s, at least more than the current 183 aircraft built or on order. Such subterfuges are not unknown in defense contracting. But this time around, that pile of cash has become the center of a feud between Department of Defense officials who want to limit the number of F-22s to be built, and air force generals, politicians and defense contractors who want to build more. And that's how the game is played.

 

 

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