F-35 Joint Strike Fighter: Critical Analysis of Program Delays and Cost Overruns

Latest GAO Report Reveals Systemic Issues Threatening Naval Aviation Readiness

The F-35 Lightning II Joint Strike Fighter program continues to face unprecedented challenges that threaten to undermine America's naval aviation superiority and strain the defense budget beyond sustainable limits. The latest Government Accountability Office (GAO) report, released September 3, 2025, paints an alarming picture of a program that has failed to deliver on its most fundamental promises after nearly two and a half decades of development and production.

Executive Summary of Current Crisis

After years of cost growth and schedule delays in its hardware and software modernization effort for the F-35 aircraft, known as Block 4, the Department of Defense (DOD) is in the process of establishing a new major subprogram to help meet cost, schedule, and performance goals. Currently, Block 4 costs are over $6 billion more and completion is at least 5 years later than original estimates.

The GAO's September 2025 report reveals that in 2024, Lockheed delivered 110 aircraft. All were late by an average of 238 days, up from 61 days in 2023. This represents a catastrophic deterioration in delivery performance that directly impacts fleet readiness across all services, with particular implications for naval aviation's ability to replace aging legacy platforms.

Program Background and Fifth-Generation Requirements

The Joint Strike Fighter program emerged from the Pentagon's ambitious vision to design a single fifth-generation strike fighter capable of meeting the diverse operational requirements of the Air Force, Navy, Marine Corps, and international partners. Fifth-generation capability encompasses stealth technology, advanced avionics, and sensor fusion that yields unprecedented situational awareness and command and control capabilities within an adaptive network-centric warfare strategy.

On October 26, 2001, Lockheed Martin was declared the winner of the JSF competition, defeating Boeing's X-32 design. However, the ambitious nature of the F-35's generational improvements has led to persistent delivery delays and cost overruns that have plagued the program from its inception.

Early development challenges included a helmet-mounted display system that suffered from symbology jittering issues requiring five years to correct, premature fuselage cracks in the F-35B Marine variant necessitating structural redesigns, and tail hook problems on the carrier-based F-35C that forced a two-year redesign effort. Additionally, afterburner use caused heat damage to horizontal tails on both B and C models, while the F-135 turbofan engine experienced low-observable augment problems that required further redesigns.

Current Block 4 Modernization Crisis

The Block 4 modernization effort represents the most critical capability upgrade for the F-35 fleet, designed to counter emerging threats—particularly from China—through enhanced weapons integration and radar improvements. The Pentagon now anticipates the F-35's Block 4 modernization won't be complete until 2031 at the earliest, a five-year delay from its original timeline, even as the department rescopes the effort to include fewer capabilities than originally envisioned.

The program originally envisioned 53 capability upgrades that subsequently grew to 66 before being restructured into a reduced-scope subprogram. Program officials expect to deliver fewer capabilities, generally reducing the content of the Block 4 major subprogram from how DOD has presented it in past years.

Technology Refresh 3: The Critical Bottleneck

Central to the Block 4 delays is Technology Refresh 3 (TR-3), a $1.9 billion suite of hardware and software upgrades that provides the enhanced processing capability and increased memory capacity necessary for Block 4 functionalities. Lockheed Martin's Technology Refresh 3 (TR-3)—a $1.9-billion suite of hardware and software upgrades that are critical to the Block 4 modernization effort—was the primary driver of late aircraft deliveries in 2024.

TR-3 development has faced multiple setbacks, including supply chain issues, software development problems, design immaturity of the mission computer's integrated core processor, quality issues with delivered components, design delays in the next-generation Distributed Aperture System (DAS), and software stability issues affecting radar and cockpit displays.

Production and Delivery Performance Deterioration

The GAO report documents a precipitous decline in delivery performance that threatens readiness across all F-35 variants. GAO claims that Lockheed Martin was late in delivering all 110 F-35s during 2024, with delays averaging 238 days, compared to 61 days in 2023. This represents a nearly 400% increase in average delivery delays within a single year.

The Pentagon's response to TR-3 delays included a temporary halt to F-35 deliveries lasting approximately one year. To mitigate the risk of having over 100 high-value aircraft parked at contractor facilities, the program office made the controversial decision to provisionally accept aircraft in a non-combat-capable status. Lockheed ended up storing dozens of new jets, which were slated to have TR-3, at locations such as its Fort Worth, Texas, facility as it scrambled to get TR-3 working.

Engine Production Challenges

Pratt & Whitney's F-135 engine production has similarly failed to meet contractual requirements. Pratt & Whitney delivered all 123 engines late in 2024, due to supply chain issues. The engine manufacturer has consistently missed delivery deadlines while earning tens of millions in incentive fees—a situation that GAO characterizes as fundamentally dysfunctional.

The Block 4 modifications require more power and cooling than originally projected, forcing the engine to work harder than designed and reducing overall life expectancy. This reality has added $38 billion to the JSF program's life-cycle cost estimate and necessitated a $1.3 billion engine core upgrade program that won't be ready until at least 2031.

Cost Growth and Financial Impact

The financial implications of F-35 program delays extend far beyond acquisition costs. DOD estimates that Block 4 and engine and power thermal management modernization—as well as the costs to maintain and operate the 2,470 planned aircraft over the 77-year life cycle—will exceed $2 trillion.

The F-35's acquisition costs — which include development and procurement — have grown to more than $485 billion, as of December 2023. This represents a 43 billion increase from the previous December 2022 estimate alone.

Problematic Incentive Structure

The GAO report particularly criticizes the program's incentive fee structure, which has allowed contractors to earn substantial bonuses while consistently failing to meet delivery schedules. In recent years, the program paid contractors, such as Lockheed Martin, hundreds of millions of dollars in incentive fees that were intended to improve on-time delivery.

The current contract structure allows Lockheed Martin to earn partial incentive fees for aircraft delivered up to 60 days late, with fees decreasing incrementally for each additional day of delay. When officials recognized that Lockheed Martin could not earn these incentives due to TR-3 problems, rather than withholding payment, they rewrote the contract to repurpose incentive fees to other manufacturing processes.

Impact on Naval Aviation

For naval aviation specifically, F-35C delays have forced the Navy to extend Boeing Super Hornet production beyond original plans. In 2015, Congress approved $1.3 billion for 17 additional Super Hornets to bridge capability gaps created by F-35C delays. The implications for carrier air wing composition and modernization timelines continue to ripple through Navy force structure planning.

The F-35C achieved full operational capability with the Navy in February 2019—18 years after the original contract award. Despite this milestone, ongoing Block 4 delays mean that the Navy's most advanced fighter will not possess its full intended capabilities until at least 2031, potentially longer if current trends continue.

Supply Chain Vulnerabilities

As of early 2025, Lockheed Martin faced more than 4,000 parts shortages, twice the historic average, which left 52 aircraft stalled in the final assembly stage. These supply chain strains affect not only production schedules but also sustainment operations for the existing fleet.

International Partner Implications

F-35 delays have significant implications for international partners who have invested billions in the program. In 2024, Denmark warned of uncertainty over its next F-35 deliveries, while Belgium and other European partners also faced delays linked to TR-3 certification problems. These delays potentially undermine alliance interoperability and burden-sharing arrangements that are fundamental to U.S. defense strategy.

GAO Recommendations and Pentagon Response

The GAO made six key recommendations to address program deficiencies:

1. Evaluate Lockheed Martin's capacity to meet planned deliveries on time
2. Reevaluate the use of incentive fees to better achieve desired schedule performance
3. Expand and formalize the use of leading practices for product development
4. Better align planned production with contractor capacity
5. Improve supply chain management intervention
6. Establish formal acquisition pathways for engine and power system upgrades

DOD concurred with four recommendations and partially concurred with two. For all six recommendations, DOD cited actions it is taking to address them. However, the GAO noted that further action is warranted to fully address the recommendations.

Strategic Implications and Assessment

The F-35 program's continued struggles raise fundamental questions about defense acquisition practices and strategic readiness. "After nearly 20 years of aircraft production, however, the F-35 program continues to overpromise and underdeliver", as the GAO bluntly stated in its assessment.

The program's management structure, led by the Program Executive Office Joint Strike Fighter (PEO JSF) in Northern Virginia, represents the most senior-ranking PEO within U.S. Military Systems Commands—reflecting the program's critical importance. However, this seniority has not translated into effective program execution.

The F-35's open architecture, originally designed to facilitate rapid technology insertion and reduce modernization costs, has instead become a source of additional delays and cost overruns. Each attempt to leverage this supposed advantage has resulted in further schedule slips and budget increases.

Alternative Investment Considerations

The magnitude of F-35 cost overruns raises important opportunity cost questions for naval aviation modernization. The $16 billion allocated for Block 4 improvements could fund significant upgrades to existing platforms or accelerate development of next-generation systems. Similarly, the broader $2 trillion program cost could support comprehensive fleet modernization across multiple platforms and domains.

For naval aviation specifically, these resources could potentially fund additional carrier construction, accelerated development of the Navy's Next Generation Air Dominance (NGAD) program, or substantial improvements to existing F/A-18E/F Super Hornet capabilities through the Block III upgrade program.

Conclusion and Recommendations

The F-35 program represents both a cautionary tale about defense acquisition management and a critical capability gap that must be addressed. The GAO's latest report confirms that fundamental program management reforms are necessary to prevent further deterioration in delivery performance and cost control.

For naval aviation leaders, the implications are clear: continued F-35C delays will necessitate extended reliance on legacy platforms and potentially accelerated development of alternative solutions. The Navy must balance its commitment to the F-35 program with realistic assessments of when advanced capabilities will actually be available to the fleet.

The program's $2 trillion life-cycle cost and persistent schedule delays demand immediate Congressional oversight and potential restructuring of contractor incentive agreements. Without substantial reforms, the F-35 program risks becoming a strategic liability rather than the capability advantage it was designed to provide.

As the GAO concluded, "Better aligning planned production and sustainment demands with contractor and supplier capacity would facilitate the ability of contractors to deliver engines and aircraft on time and better ensure warfighters received aircraft when planned."

The stakes for naval aviation readiness and national security could not be higher.

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Sources

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