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Lockheed says in talks with Spain, Belgium, others on buying F-35s

By Jamie Freed

AVALON, Australia (Reuters) - Lockheed Martin Corp said on Friday it was talking to the governments of Spain, Switzerland and Belgium about selling its F-35 fighter jets to the European nations.

Bringing new customers could help significantly reduce the cost of the military aircraft after several blowouts and production delays. The United States and 10 allies are clients of the F-35 currently.

"We are talking to several other countries - Switzerland, Belgium, Spain," Jeff Babione, Lockheed Martin's F-35 program leader, told reporters at the Avalon Airshow in Australia.

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"There are quite a few other European nations that are looking at perhaps having the F-35 as an opportunity," Babione said. "We are starting to see other customers think about the F-35 being added to their fleet."

Another person familiar with the discussions, who was not authorized to speak on the record, said that Finland was also in talks.

Babione said that countries already signed up to the F-35 program along with the United States - Australia, Denmark,Italy,the Netherlands, Norway, Turkey, the United Kingdom, Japan, South Korea and Israel - need to start ordering in blocks beyond yearly commitments to help meet a reduced target cost of $80 million by 2020.

"It is actually a very reasonable target but it is going to take cooperation in changing the way we buy the aircraft," he said.

U.S. President Donald Trump has criticized the cost of the project. While the price per jet has steadily declined since the first jets were delivered to the U.S. military in 2011 as production has increased, it remains at $94.6 million.

Lockheed is pressing purchasers to agree to a three-year block buy that would help reduce costs by bulk sourcing parts.

"The longer we do it the more we are able to aggregate," Babione said. "Maybe in the future you are talking about a multi-year and you could do a five year multi-year and increase the savings."

Babione also urged Canada to speed up a decision about whether it would buy the F-35s or Boeing Co's Super Hornets instead.

The Pentagon's head of the F-35 program said earlier this week at Avalon that the overall reliability of the jets is being pulled down by initial versions of the aircraft which do not perform as well as more recently delivered jets.

"Unfortunately today the aircraft reliability and maintainability of the airplane is what I would call flat," Lieutenant General Chris Bogdan of the U.S. Department of Defense said.

(Additional reporting by Mike Stone in WASHINGTON; Writing by Jane Wardell; Editing by Muralikumar Anantharaman)