Lockheed Martin shares fall after Trump targets F-35 program's cost again during news conference
President-elect Donald Trump criticized the cost of Lockheed Martin's F-35 program during his news conference Wednesday. Shares of the defense contractor fell more than 1 percent after the comments.
Lockheed Martin intraday chart
"I'm very much involved with the generals and admirals on the airplane, the F-35," Trump said. "It's way, way behind schedule and many, many billions of dollars over budget. I don't like that. ... We're going to do some big things on the F-35 program and perhaps the F-18 program. We're going to get those costs way down."
Lockheed Martin shares dropped 2 percent on Dec. 12 when the president-elect first put the company in his crosshairs over F-35 costs with this tweet:
@realDonaldTrump The F-35 program and cost is out of control. Billions of dollars can and will be saved on military (and other) purchases after January 20th.
On Dec. 21, Trump met with the CEO of Lockheed, Marillyn Hewson, at his Mar-a-Lago resort in Florida, along with the CEO of Boeing, a company he criticized in December as well for the cost of the 747 Air Force One program.
After that meeting, Hewson said she "appreciated the opportunity to discuss the importance of the F-35 program and the progress we've made in bringing the costs down."
But apparently Trump wasn't satisfied by what he heard from Hewson, tweeting the next day that he was asking Boeing to price out an alternative to the F-35, knocking the company's stock again.
Trump tweet Based on the tremendous cost and cost overruns of the Lockheed Martin F-35, I have asked Boeing to price-out a comparable F-18 Super Hornet!
Through all that, Lockheed Martin's shares rebounded again in the new year and had nearly wiped out all the declines that resulted after Trump's first negative tweet, until Wednesday.
A Lockheed Martin spokesperson issued a statement to CNBC on Trump's comments:
"We understand President-Elect Trump's concerns about the F-35 program and we've given him our full commitment to drive down cost aggressively.
We are focused on delivering the best capability possible at the best value for the American taxpayer. The price of an F-35A has come down 60 percent from the first lot contract to the recent ninth contract, and we fully expect the next contract will show another significant price decrease. At the same time, we are actively working two cost cutting initiatives known as Blueprint for Affordability and the Sustainment Cost Reduction Initiative to reduce the cost of the program by $5 billion through 2022.
We look forward to continuing to work with our government and military leaders to build on the F-35 program's record of performance and affordability."