UPDATE 2-Pentagon withholds $5 million per F-35 jet as deliveries resume

As part of the agreement, the JPO will withhold the $5 million portion of final aircraft delivery payments from Lockheed until the TR-3 "combat capability is qualified and delivered", the Pentagon said. Additionally, Lockheed Martin and its industry partners are investing in development labs and digital infrastructure that benefit the F-35, the Pentagon said.

Deliveries of F-35 jets to the U.S. military have resumed, but the U.S. government is withholding the final $5 million payment for each jet until the completion of the TR-3 technology upgrade, the F-35 Joint Program Office said on Thursday. "We have coordinated the terms and conditions with Lockheed Martin. As a portion of the agreement, approximately $5 million per aircraft is being withheld and will be released as combat capability is delivered," an F-35 joint program office spokesman said.

The F-35 costs an average of $82.5 million each for the F-35A variant being delivered in calendar years 2023, 2024 and 2025. The short takeoff and landing "B" variant and the Navy's "C" variant for use on aircraft carriers cost on average $109 million and $102.1 million, respectively. A months-long delay in deliveries of the jet was linked to a lingering issue on the TR-3 tech refresh, which refers to a series of software and hardware improvements to the F-35 giving the jets better displays, computer memory and processing power.

On Thursday the F-35 Joint Program Office (JPO) and Lockheed Martin said they had reached an agreement for the acceptance and delivery of Technology Refresh 3 (TR-3) enabled aircraft with a "robust combat training," but not the full combat capability. As part of the agreement, the JPO will withhold the $5 million portion of final aircraft delivery payments from Lockheed until the TR-3 "combat capability is qualified and delivered", the Pentagon said.

Additionally, Lockheed Martin and its industry partners are investing in development labs and digital infrastructure that benefit the F-35, the Pentagon said.

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