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September 26, 2011

Report says Iraq has made down payment on F-16s

F-16There is no official confirmation yet but the Wall Street Journal (subscription) is reporting that Iraq has made a $1.5 billion down payment on the purchase of 18 F-16 fighter jets.

The sale, which has been widely expected for some time but not completed, would be the first in some time for Lockheed Martin which assembles the F-16 in Fort Worth.

Lockheed officials have been saying all year they need to nail down some firm F-16 orders in order to maintain the F-16 production lines, both its own and for suppliers. Lockheed has said its existing order book would be exhausted by the end of 2013 without new buys and that it would have to begin shutting down early portions of the production process by the end of this year if no new orders were forthcoming.

The Journal reports:

The deal is considered sensitive in Iraq, and the Pentagon and State Department have declined to comment until a formal announcement is made by Baghdad. Iraq had plans to buy the planes earlier in the year, but froze them for a time following the Arab Spring protests across the region.

The decision by Iraqi Prime Minister Nouri al-Maliki to go forward with the purchase followed an unexpected surge in government oil revenue, officials said.

Iraq has said the 18 fighters would be the country's first installment. Baghdad hopes to buy as many as 36 jets in total, pending U.S. approval.

- Bob Cox

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