(Bloomberg) -- The Pentagon took first delivery Friday of the latest version of F-35 fighter jets after deciding not to wait any longer for delayed hardware and software upgrades, allowing payments to resume to Lockheed Martin Corp.
Two F-35A Lightning II aircraft were delivered after a halt last year, one to Dannelly Field, Alabama, and one to Nellis Air Force Base, Nevada, the Pentagon program office said in statement.
The move comes after officials decided that the Defense Department couldn’t wait any longer for the full TR-3 upgrade to complete testing given that jets were left parked at a Lockheed facility in Texas — where they might suffer weather damage — and pilots weren’t able to train on the aircraft.
“We have initiated a phased approach to the delivery of TR-3 F-35 aircraft,” Lt. Gen. Mike Schmidt, the program manager said. “Our focus has been on providing our customers with aircraft that are stable, capable, and maintainable, and this phased approach does that.”
The Pentagon has decided to retrofit the jets later when the new upgrade is fully tested. Schmidt said the Pentagon is planning for full TR-3 combat capabilities in 2025.
Lockheed F-35 Vice President Bridget Lauderdale said the upgrade represents “a critical evolution in capability and their full development remains a top priority for us.”
The Pentagon was withholding about $7 million in final payments for each undelivered aircraft, according to estimates by Jefferies aerospace analyst Sheila Kahyaoglu. Lockheed projects delivering between 75 and 110 aircraft by Dec. 31, meaning the change could bring $700 million or more to the company in that time, Kahyaoglu said.
(Updates throughout with Pentagon program office and Lockheed statements.)
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