The $4 billion tweet Donald Trump sent in the wee hours of the morning crashed right into the giant aircraft carrier company, Lockheed Martin. The cost of the F-35 fighter jets has nearly doubled from the estimated cost, but there is a lot the tweeter-in-chief doesn’t know.
Trump took to his Twitter machine Monday to say that the military fighter jet “program and cost is out of control.” For the second time in as many weeks, the billionaire has hit the U.S.’s largest aircraft companies, according to CNBC.
Lockheed has spent millions to reduce governmental costs, yet Trump’s continued attack on the aerospace industry and its huge, well-paying workforce may knock the feet out from under the U.S. economy. The president-elect tweeted Monday:
‘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.’
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.
— Donald J. Trump (@realDonaldTrump) December 12, 2016
Lockheed contracted to deliver 1,763 of the 2,443 total F-35s ordered by the Pentagon. They will form the “backbone” of the Air Force.
Trump does not take into consideration the way the aerospace industry works, or he does not care. Immediately after Trump’s message hit, Lockheed Martin’s stock dropped — even before the U.S. markets opened. The president-elect’s tweet immediately caused Lockheed’s stock to drop $4 billion.
— CNBC Now (@CNBCnow) December 12, 2016
Last week the president-elect criticized a second aircraft giant, Boeing, over the cost of the new Air Force One jets, even though the presidential planes are nearing the end of their 30-year-life expectancy. After Trump’s tweet, Boeing saw its stock drop radically, too. Trump’s tweet said:
Trump is not alone in criticizing the cost and time overruns for the F-35. Armed Services Committee Republican Sen. John McCain of Arizona did not like the contract either. He called the $6.1 billion deal between Lockheed and the Pentagon “the height of acquisition malpractice.”
‘Unfortunately, it is too often seen as business as usual. That is why the acquisition reforms in last year’s and this year’s National Defense Authorization Act are so critical. We cannot change course soon enough.’
Why is the president-elect is hitting the aircraft industry so hard? It may be that he just does not understand the interface between the industry, the U.S. economy, and the government. Certainly, these aircraft companies can continue to tighten controls and better estimate costs. But given the nature of the aerospace industry, it is virtually impossible to be exact.
If Trump continues down this destructive path, the U.S.’s healthy aircraft industry will begin to teeter. New contracts, like Boeing’s new contract with Iran to update its aging jet fleet, may disappear. Iran Air plans to buy 80 of its Boeing planes in a contract for $16.6 billion. This is the first time in 37 years Iran has been able to update its fleet and is great for the U.S. economy.
— Bloomberg (@business) December 12, 2016
Hopefully, someone will take the Twitter King’s tweet machine away from him before he totally wrecks the U.S. economy.
Featured Image: Getty Images.