Lockheed falls as Trump tweets that F-35 program is costly

AP News
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Posted: Dec 12, 2016 3:07 PM
Lockheed falls as Trump tweets that F-35 program is costly

NEW YORK (AP) — Shares of Lockheed Martin fell Monday, wiping out nearly $2 billion of the company's market value, as President-elect Donald Trump tweeted that making F-35 fighter planes is too costly and that he will cut "billions" in costs for military purchases.

Trump didn't mention any specific company in his tweet, but Bethesda, Maryland-based Lockheed makes the F-35 one-seat fighter aircraft and is a major U.S. defense contractor.

The F-35 program made up 20 percent of Lockheed's total 2015 revenue of $46.1 billion. And U.S. government orders made up 78 percent of its revenue last year. The F-35 program directly or indirectly supports more than 146,000 U.S. jobs, according to the company's website .

In a statement Monday, Lockheed said that it has worked to lower the price of the F-35 by more than 60 percent and said it expects the aircraft to cost $85 million in 2019 and 2020.

"We welcome the opportunity to address any questions the president-elect has about the program," said Jeff Babione, general manager of the F-35 program. "It's an amazing program."

This is the second time in a week that Trump has blasted U.S. aircraft spending. Trump tweeted last week that costs to build new presidential planes by Boeing Corp. were "out of control" and ended the tweet with "Cancel order!"

Lockheed Martin Corp. shares fell $6.36, or 2.5 percent, to $253.17 in afternoon trading Monday.

Shares of other defense contractors also tumbled. Raytheon Co. dropped 2.2 percent to $143.08 and Northrop Grumman Corp. which fell 3.4 percent to $230.