Thursday, June 17, 2010

DTN News: U.S. Defense Secretary Robert Gates Says GE-Rolls Royce F-35 Engine Falls Short

Defense News: DTN News: U.S. Defense Secretary Robert Gates Says GE-Rolls Royce F-35 Engine Falls Short
* Gates opposes lawmaker efforts to keep funding engine
* GE denies engine falls short on performance
* Says Pentagon's ratings belie Gates's remarks
* Pratt & Whitney building engine in early F-35 fighters (Rewrites first paragraph to add political context; adds Gates and GE comments, stock prices)

Source: DTN News / Reuters By Jim Wolf
(NSI News Source Info) WASHINGTON, - June 17, 2010: U.S. Defense Secretary Robert Gates said an alternate engine for the multinational F-35 fighter jet appears to fall short on performance, underlining his opposition to congressional moves to continue funding it.
The Pentagon thinks that the second engine "does not meet, probably does not meet, the performance standards that are required," Gates, who deems the engine a costly extravagance, told the Senate Appropriations Committee on Wednesday.
The alternate engine is being developed jointly by General Electric Co (GE.N) and Rolls-Royce Group Plc (RR.L) in a battle for a projected $100 billion engine market for the F-35. United Technologies Corp's (UTX.N) Pratt & Whitney unit builds the engine used in early F-35 production models.
A GE spokesman, Rick Kennedy, disputed Gates's comments. The engine is "meeting and exceeding all performance expectations in terms of aeromechanical characteristics, temperature margins, turbine design, the control system and operability," he said.
"The secretary's comments contradict the detailed assessment from the Department of Defense, which has consistently awarded very good and excellent ratings to the (second engine)," said Kennedy in an email.
President Barack Obama, consistent with Gates's advice, said last month he would veto any legislation to fund a second engine for the F-35, which is being built by Lockheed Martin Corp (LMT.N).
The F-35 program is valued at up to $382.4 billion to develop and buy more than 2,400 F-35s through 2036, the Pentagon's costliest purchase ever.
Obama's veto threat came after the House of Representatives adopted, on May 28, its version of a fiscal 2011 defense spending bill that included $485 million to keep the alternate engine alive.
The Pentagon has sought to kill the second engine for four years, defied each time by Congress, which controls the Defense Department's purse strings.
Several key lawmakers, including the chairmen of the House and Senate Armed Services committees, have questioned whether Obama would use his veto over the second engine if presented with a military spending bill that delivered other important initiatives he has sought.
Obama has said he would do so over either the second engine or any move to fund more Boeing Co (BA.N) C-17 cargo planes, of which the Air Force says it has more than enough.
Gates cautioned lawmakers, "It would be a very serious mistake to believe the president would accept these unneeded programs simply because the authorization or appropriations legislation includes other provisions important to him and to this administration."
He said the F-35 Joint Strike Fighter, co-developed with Britain and seven other foreign partners, was meeting its performance parameters even though its development phase has been extended and even though the Pentagon's early purchase plans have been slowed amid efforts to put the program back on track after schedule slips and soaring costs.
"What we think we have endured (in the F-35 program) is primarily management and production problems, a lack of adequate execution on the part of the Defense Department itself," Gates said.
Kennedy, the GE spokesman, also disputed Gates's estimate that the second engine would cost at least $2.9 billion more to develop. The company has put the figure at another $1 billion.
In another point of contention, Gates suggested the GE-led team had lost a competition to Pratt & Whitney, an analysis strongly rejected by GE, Rolls-Royce and their supporters in Congress.
"My view is a competition is winner-take-all," Gates said. "And I think we've had that competition and it's time to move on with the program."
GE and Rolls-Royce, in a statement last month, denounced such a view as "the oldest myth of the (F-35) program and totally untrue."
The U.S. Air Force directed Boeing and Lockheed, which submitted competing Joint Strike Fighter designs, to both use a Pratt engine in their concept demonstrator aircraft.
Congress recognized in 1996 that an engine competition for the aircraft was never held, and it authorized development funds to GE/Rolls-Royce with the intention of introducing a competing engine four years into the aircraft program, the GE-Rolls statement said.
GE shares were up 0.9 percent to $15.92 in afternoon trading on the New York Stock Exchange. Shares in United Technologies were unchanged at $68.60.
(Reporting by Jim Wolf; Editing by Lisa Von Ahn, John Wallace and Tim Dobbyn)

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