Lockheed Martin to pitch F-16 line transfer to India

With the production of the iconic F-16 fighter aircraft nearing its end, US defense manufacturing giant Lockheed Martin, is proposing to transfer its Final Assembly and Check Out line (FACO) to India.

Randy Howard, Director of F-16 Business Development for Lockheed Martin, announced this at DefExpo 2016 in Goa on Wednesday, saying, “There has been a lot of press – a fair amount of press over the last six to eight months about opportunities for F-16 Make in India production here. We stand behind that. Our CEO met with the prime minister many months ago. We have some discussions coming in the next few weeks between our two governments that will – I think – mature that opportunity. And we believe that there’s a very unique opportunity for India with respect to production of F-16s. We don’t want to get too far out in front of the government discussions which are in the very near term and then I think right after that maybe we can have some more forthcoming discussions but there is a tremendous opportunity for decades in the future for the production of F-16s and we see the best place for that right here in India.”

Reuters had reported two weeks back that Lockheed Martin officials would travel to India in April with a formal offer, quoting Susan Ouzts, vice president of Lockheed’s F-16 program.

In response to a question on whether Lockheed Martin was offering to move its assembly line, Howard said, “So that’s part of what we’ve been discussing. Certainly that’s (FACO) on the table. We’re going to have these discussions in the coming weeks and we’ll better understand that once we understand what the requirements are from the customer. I think we need to have that conversation first but we believe it being at least that much, right, potentially even more.”

Lockheed Martin has an order backlog of 20 aircraft, production of which is expected to complete by the end of 2017. According to Howard, ‘All in all, 27 customers, 4588 aircraft ordered today – we have 20 in backlog. We have production out right now till the end of 2017. We’re in discussions with about five different countries today that will take production out well beyond 2020. And we look forward to having a more detailed set of discussions about the F-16V or whatever the requirements happen to be here in India for their fighter aircraft needs and those discussions are just around the corner for us.”

Asked if this proposal was related to the anticipated end of production, Howard said, “The US government and the government of India are having these conversations. The opportunity that will come from the F-16 is a bit different – I think – than our competitors can offer. In many cases because they have active assembly lines that extend for some time into the future and in other places and the opportunity for an F-16 production line could be much more meaningful in terms of its exclusivity as we have these government conversations going on. We have a very active production assembly on the F-35. So that’s the real difference. Our workforce is actively building F-35s. And that’s a fundamentally different scenario than our competitors have. Because the aircraft they’re offering, they are actively building and depend upon building that.”

Lockheed Martin is proposing to begin deliveries by 2019 as part of its offer to India. Howard said, “Whatever decision India makes here is going to be an incredibly important one because you desperately need fighters. You need them as soon as possible. Your air force is grossly short of what they’ve identified as their requirements. You need a couple of things. One is I think you need a fighter aircraft that can be delivered quickly. So what we’re talking about is a 2019 first delivery and 2020-timeframe delivering from India. Remarkably quick turn time for those in the next three to four years.”

Howard also pointed to Lockheed Martin’s experience in setting up F-16 production lines by saying, “And you need to make sure this time around that you know how to do this very thing. Right. Lockheed Martin has established F-16 production facilities in Belgium, we’ve established F-16 production facilities in the Netherlands, we’ve established F-16 production facilities in Turkey, we’ve established them in Korea. We’ve been successful every time. We know how to go into a country work with local industry and teach them how to build F-16s and how to assemble them. We’ve done it. We’re doing it in fact today on the F-35. We’re doing it in Italy, we’re doing it on the F-35 in Japan. So this is a skill set that Lockheed Martin has that nobody else can match. And so what you get when you partner with Lockheed Martin is a known quantity – a known aircraft that can be produced very quickly. We’re going to stand up our experience working with industry here in India. We know how to do it not just around the world but we’ve proven we can do it here in India as well. That’s of tremendous value and something our competitors do not have.”

Asked if Lockheed Martin would be willing to move the assembly line even in the absence of an Indian order, Howard said, “There’s a tremendous amount of expense associated – you’ll appreciate – with moving an assembly line. We have multiple – If you were to make an assumption that we’re going to move the production line we would look at various options – we have many opportunities; many different places we might consider moving them to. We just happen to believe that from a business perspective the opportunity in India aligns very well with Lockheed Martin, Indian and US government interests. The timing is very good right now for considering moving the production line.”

According to Howard, Lockheed Martin is upgrading the F-16 aircraft of three countries – Southeast Asian and East countries – to the F-16V standard. “We had a launch customer for the F-16V program that’s just about three years ago and so we’re three years ahead of anybody else that wants to try to do this on these aircraft – ‘cos we’ve been doing this for three years now. Flight testing at this point. Six months into the flight test program on F-16V,” he said.

Calling the F-16V a ‘natural evolution of a proven Mid Life Update program and a Common Configuration Improvement Program’, Howard said, “What we are doing with the F-16 is taking all of what we’ve learned from the F-35 and F-22 and what really represents 100 billion dollars in investment by the United States and fielding those capabilities taking those technologies off of them and reinserting them into the F-16 to make it so much more relevant for the future.”

Listing capabilities like Active Electronically Scanned Array (AESA) radar and Automatic Ground Collision Avoidance System (Auto GCAS), Howard said, “It’s the next iteration of upgrades, so we’re taking technologies that are on our latest fifth generation airplanes – Lockheed Martin being the only fighter aircraft manufacturer that has designed manufactured and fielded operational fifth generation fighter airplanes – we’re taking those technologies to the extent that we can and we’re rolling them back into the F-16,” he added.

Lockheed Martin had fielded the F-16 in the Indian Air Force (IAF) tender for 126 Medium Multi Role Combat Aircraft (MMRCA), for which the French Dassault Rafale was selected.

After three years of failed negotiations, the tender was withdrawn when Prime Minister Narendra Modi requested the purchase of 36 Rafale aircraft from the French government in April 2015, on an urgent basis, with the same specifications as required under the MMRCA tender and on better terms than required under the MMRCA tender. Negotiations for the purchase of the 36 Rafales have still not been concluded and some media reports indicate them to be faltering.

Since April 2015, Sweden’s Saab has offered to set up production of Gripen aircraft in India. Boeing has also offered to manufacture its F/A-18 Super Hornet in India.