Israeli Negotiations for F-35 Bogging Down Over Costs, Technology Concerns

NEWTOWN, Conn: Negotiations between the Israeli Defense Ministry and Lockheed Martin for the purchase of advanced, new-generation F-35Joint Strike Fighter stealth aircraft continue to bog down over thefinal hurdles of unit cost and integration of Israeli-specific avionicsand armaments.
While the Israeli defense establishment complains of soaring F-35unit costs - a completely rational concern considering the potentialdefense budget cuts looming on the horizon - the real issue seems to bethe installation of Israeli-made systems onto the aircraft.

Israel's five-year defense plan ('Teffen 2012') places emphasis on acquiringadvanced precision strike fighters, with the focus being on the F-35.Under the Israeli defense plan, funding for a squadron of 25 F-35s willbegin prior to first delivery, which, based upon Pentagon andCongressional approval in September 2008, should be in 2014. This firstsquadron would then come into service two years later.Israel isplanning to purchase a further 50 aircraft in order to outfit twoadditional squadrons at a later date. Originally the Israelis hadplanned on purchasing 100 F-35s, but funding shortfalls forced them todownsize their immediate plans.
Yet despite Israel's F-35 designs, its defense establishment is now considering whether the Israeli Air Force(IAF) can maintain its military-technological regional edge withoutgoing forward with the JSF purchase. Upgrades to existing Israeli F-15and F-16aircraft, or purchasing advanced types of both platforms (including theBoeing F-15 Eagle), are both seen as an alternative option.
This may be a smoke screen intended to extract concessions from theU.S. for permitting the implementation of Israeli systems onto theF-35s. The Israelis remain interested in wrapping upnegotiations for the F-35 this year, and the IAF remains highly desirous of the aircraft.
While cost is no doubt a very real concern - the estimated price tagfor the 75 F-35s is placed at $15.2 billion - much of the Israelifunding comes in the form of U.S. Foreign Military Financing (FMF) credits, which will total $11.425 billion from 2009 through 2012 alone.
Also, the other U.S. advanced stealth alternative, the F-22 Raptor,is not available on the export market per Congressional law. Even inthe unlikely event that this law was revoked by the Obamaadministration, production on the aircraft is set to end in 2011, thuscausing its unit price-tag - already estimated at $146 million in 2008dollars - to escalate even higher and making its cost even moreprohibitive than the JSF.
What aircraft option the Israeli Defense Ministry ultimately pursuesmay depend on the time frame by which Israeli intelligence estimatesthe Iranians could be capable of producing nuclear armaments.
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