Switzerland weighs cuts to F-35 order amid cost dispute, tariff pressure

WASHINGTON — Swiss officials said today negotiations with the US have failed to resolve a pricing dispute over an order for F-35 fighter jets, raising the possibility that Bern will have to reassess its planned buy.

After selecting the jet in 2021 and inking a contract in 2022, Switzerland says its order of 36 F-35A aircraft made by Lockheed Martin should be set at a fixed price of 6 billion Swiss francs, or over $7.4 billion in current dollars. But according to a press release from the Swiss government, a fixed price has been “abandon[ed]” despite “intensive discussions” between Swiss and American officials, leading to inflationary and tariff pressures that could drive up the cost of the order between anywhere from 650 million to 1.3 billion Swiss francs.

“The discussions clearly showed that the USA is not prepared to deviate from its position. The result is that Switzerland must accept that the price per production batch corresponds to the value negotiated between the US government and Lockheed Martin and that it is not possible to assert a fixed price,” the Swiss government’s press release says.

Switzerland “remains committed to procuring the F-35A,” the release adds, noting that government’s aim is to acquire a jet that “has a significant technological advantage over other aircraft and is now in widespread use across Europe.” Still, the government has directed the Swiss defense department to “examine whether current air defence requirements still correspond to the principles on which the evaluation of the F-35A was based” and “submit a proposal regarding the next steps” by the end of November. 

In a press conference discussing the new development, Defense Minister Martin Pfister said that Switzerland may end up buying fewer F-35s, but acknowledged that the aircraft still possessed superior capabilities compared to other options, which may take longer and cost more to procure anyway, according to Bloomberg. 

Lockheed Martin said in a statement, “Since foreign military sales are government-to-government transactions, questions about F-35 cost, schedule and procurement are best addressed by the armasuisse and U.S. government,” referring to the Swiss armament procurement department.

Spokespeople for the US Office of the Secretary of Defense and the F-35 Joint Program Office did not immediately respond to a request for comment.

The F-35 pricing dispute comes as Switzerland reels from a shocking 39 percent tariff rate imposed by the Trump administration at the end of July, the highest in Europe and among the highest in the world. Some Swiss lawmakers have called for the cancellation of the F-35 order in response, which was planned to recapitalize Bern’s aging fleet of legacy fighters. 

Uncertainty introduced by the Trump administration, combined with a surge in defense spending across Europe, has created something of a mixed bag for the F-35 that boasts 20 customers worldwide. While prospective customers like Spain have ruled out purchasing the aircraft and planned buyers like Canada have previously said they’re reconsidering, other F-35 operators like Denmark have expressed interest in increasing their fleet size. 

Switzerland’s first F-35 was originally expected to be delivered in 2027, with deliveries continuing until 2030.