Development concurrent with production
One of the characteristic features of the JSF programme is the fact that production of the JSF already got underway during the development phase. This affects both the cost of the JSF and size of the orders that can be placed.
Normally speaking, a weapons system is first developed before it goes into production. This is not the case with the JSF, where the aircraft already went into production before the development process had been completed. This is known as ‘concurrency’. Although concurrency has the advantage that the JSF aircraft can be delivered to customers earlier than would otherwise be the case, it does generate certain risks as well as additional costs. If it becomes clear, after the aircraft have been delivered, that certain improvements need to be made, these improvements also have to be made to aircraft that have already been produced and delivered. Known as ‘retrofitting’, this process is both expensive and time-consuming. Moreover, it is not always feasible.
The standard weapon development process in the US
The JSF weapon development process
Where development and production are concurrent (or partially concurrent), there is a risk that any aircraft that come off the production line are not the same as those that come either before or after them. In order to prevent such a situation from arising, the JSFs are produced in ‘blocks’ (which is not the same as a ‘block buy’; see below). Each block comes with its own specifications. The use of blocks makes it easier to perform retrofits.
The main difference between the blocks lies in the software in the aircraft.
The JSF programme consists of the following blocks:
- Blocks 1a and 1b: the aircraft produced in these blocks have a limited range of functions;
- Blocks 2a and 2b: these aircraft are fitted with an intermediate version of the software. The Dutch test aircraft were produced as part of these blocks. The idea is to retrofit the aircraft produced in block 2 so as to bring them up to block 3f standard.
- Blocks 3i and 3f: the i version of aircraft produced in block 3 has initial warfare capability, whereas the 3f version has full warfare capability. The Netherlands has ordered JSFs from block 3f.
Blocks 4i and 4f will be produced as part of the follow-on development phase.
Production of the JSF has been divided into two parts. As long as development work has not been completed, a number of small, annual series of aircraft will be produced. These are known as low-rate initial production (LRIP) aircraft. Once the JSF has passed all the relevant tests, the development phase ends and the manufacturer can then start full-rate production (FRP). From this point on, customers can order larger series of aircraft covering a number of years (known as ‘multi-year buys’).
2010-2012: Restructuring of JSF programme
Under US law, the US Department of Defense is required to inform Congress about any major budget overshoots on defence materiel projects. Where the actual cost is at least 50% higher than the amount projected, the Department of Defense is under a statutory obligation to restructure the project and to resubmit it to Congress for the latter’s approval.
Early in 2010, it became clear that the JSF programme was going to exceed this critical limit and the programme was restructured by the US Department of Defense for this reason between 2010 and 2012. The restructuring resulted in the extension of the development phase by a number of years. It was also decided to extend the LRIP phase and not to start with full-rate production for the time being. The situation on 1 January 2019 was that approval of full-rate production was still pending.
As long as full-rate production has not started, orders can be placed only for small, annual series of aircraft (LRIPs). The fact is that, under US law, a multi-year buy may not be placed until the development phase has been fully completed.
In 2016, the partner countries nonetheless decided to place a single order for a large number of aircraft rather than a number of LRIP orders. They did so by ordering all the aircraft in LRIPs 12, 13 and 14, which were due to be delivered in 2020, 2021 and 2022 respectively. Buyers are in a good position to negotiate a discount when ordering a relatively large number of aircraft at once. As US law precluded the possibility of a multi-year buy, it was decided to opt for a ‘block buy’ instead. Each partner country has to decide for itself whether or not it wishes to join in with the block buy. The Netherlands has signed up for 24 aircraft as part of the block buy. For budgetary reasons, the US will not be joining the block buy until 2021.