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GE/RR propose F136 engine fixed price offer

written by australianaviation.com.au | April 30, 2010
A development F136 engine. (JSF PO)
A development F136 engine. (JSF PO)

The General Electric and Rolls-Royce team developing the alternate F136 engine for the F-35 JSF program has announced it has offered the Pentagon a fixed price offer for the engine.

An April 28 release says the offer intends to “create and accelerate competition” between the program’s two engines, the other being the Pratt & Whitney F135. A blowout in F-35 program development costs in recent years has prompted the US Secretary of Defense to try to cancel the F136 several times, but each time Congress has stepped in and restored development funding for the engine. This latest move is seen as a bid to provide surety in pricing for the program.

“We are announcing a fixed price offer for F136 engines purchased in 2012, followed by further price reductions for engines procured in each 2013 and 2014,” said David Joyce, president and CEO of GE Aviation. “We can create a competitive environment that will save the government (US)$1bn (A$1.1bn) over the next five years, and (US)$20bn (A$21.5bn) over the life of the JSF program.”

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The fixed price offered is dependent on a guaranteed number of engines being ordered over a defined period, and would be void should numbers be reduced or schedules change.

But analysts have pointed out that any savings made from more competitive tenders for engine supply contracts would have to more than offset the additional development and production costs, as well as the costs of carrying two support infrastructures for the two engines. Pentagon spokesman Geoff Morrell was quoted recently as saying, “the Department certainly is not convinced that the speculative benefits of competition will offset the very real upfront and ongoing costs of pursuing an extra engine.”

25% off starts now! Australian Aviation magazine Cyber Monday sale is now live. Have the very best of Australian Aviation’s annual print and digital subscription. This includes every In Focus and Behind the Lens digital magazine, special coverage, exclusive photos and editions you may have miss. Subscribe now at australianaviation.com.au.

GE/RR propose F136 engine fixed price offer

written by australianaviation.com.au | April 30, 2010
A development F136 engine. (JSF PO)
A development F136 engine. (JSF PO)

The General Electric and Rolls-Royce team developing the alternate F136 engine for the F-35 JSF program has announced it has offered the Pentagon a fixed price offer for the engine.

An April 28 release says the offer intends to “create and accelerate competition” between the program’s two engines, the other being the Pratt & Whitney F135. A blowout in F-35 program development costs in recent years has prompted the US Secretary of Defense to try to cancel the F136 several times, but each time Congress has stepped in and restored development funding for the engine. This latest move is seen as a bid to provide surety in pricing for the program.

“We are announcing a fixed price offer for F136 engines purchased in 2012, followed by further price reductions for engines procured in each 2013 and 2014,” said David Joyce, president and CEO of GE Aviation. “We can create a competitive environment that will save the government (US)$1bn (A$1.1bn) over the next five years, and (US)$20bn (A$21.5bn) over the life of the JSF program.”

Advertisement
Advertisement

The fixed price offered is dependent on a guaranteed number of engines being ordered over a defined period, and would be void should numbers be reduced or schedules change.

But analysts have pointed out that any savings made from more competitive tenders for engine supply contracts would have to more than offset the additional development and production costs, as well as the costs of carrying two support infrastructures for the two engines. Pentagon spokesman Geoff Morrell was quoted recently as saying, “the Department certainly is not convinced that the speculative benefits of competition will offset the very real upfront and ongoing costs of pursuing an extra engine.”

25% off starts now! Australian Aviation magazine Cyber Monday sale is now live. Have the very best of Australian Aviation’s annual print and digital subscription. This includes every In Focus and Behind the Lens digital magazine, special coverage, exclusive photos and editions you may have miss. Subscribe now at australianaviation.com.au.

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