With the first F-35 customer—the U.S. Marine Corps—set to declare operational capability with the single-engine, stealthy fighter in as little as 18 months, the Lockheed Martin jet continues to dominate the global fighter market.

However, its competitors—the Boeing F/A-18E/F, Dassault Rafale, Eurofighter Typhoon and Saab Gripen—are all continuing with upgrade plans for a diverse set of customers, some of whom will eventually buy the F-35 and others who cannot afford it.

The F-35's edge was affirmed in November when Seoul bypassed its own procurement agency's recommendation to purchase 60 semi-stealthy Boeing F-15 Silent Eagles in order to buy fewer F-35s within a set budget of 8.3 trillion won ($7.7 billion). South Korea's decision follows Japan's choice in late 2011 of the F-35, which both countries have been willing to buy at a premium, sacrificing tail numbers in their force structures for stealth and integrated avionics.

Seoul's decision likely buries Boeing's ambitions to sell the Silent Eagle variant of its venerable F-15; both the Strike Eagle and the F/A-18E/F Super Hornet and EA-18G Growler are built at the company's facility in St. Louis. The Silent Eagle was to include conformal weapons bays and employ fly-by-wire controls. It is unclear whether the company will snag more F-15 sales beyond those to Saudi Arabia; Riyadh's last aircraft is scheduled to roll off the line in 2018.

Boeing officials say the Silent Eagle options—including the stealthy weapons bay, the fly-by-wire controls and digital electronic warfare system—will remain as options for legacy F-15 customers choosing to retrofit their fleets.

For the twin-engine Super Hornet/Growler line, Boeing officials are upbeat about further buys from the U.S. Navy, which has always been the last of the three Pentagon services to buy the F-35 in volume. Ship trials slated for 2014 could jolt it out of its lukewarm stance, however. The company must decide by March whether to use its own funding to keep long-lead Super Hornet and Growler production activities in play. Boeing officials are anticipating another Navy order in the fiscal 2015 budget, which is expected to go to Congress in February; that would likely trigger Boeing funding for the line until the contract is solid, says Mike Gibbons, Boeing's Super Hornet vice president.

“Boeing financially has the ability to keep this line going,” Gibbons notes. The company has cash on hand largely because of its balanced defense and space portfolio and hearty commercial aircraft backlog.

Boeing received another blow in December when Brazil selected Saab's JAS39E/F Gripen over the Super Hornet (and Dassault Rafale) for a 36-aircraft order. The F/-18E/F had been leading the long-running FX-2 competition until revelations of U.S. spying on Brazilian officials, and the Rafale was rejected as too costly. Gibbons says there is still interest in the Super Hornet in Canada, Denmark, Kuwait, Malaysia and unnamed Middle Eastern countries. But decisions that could provide confidence in future orders are not expected in the near term.

New and potential orders notwithstanding, the heyday of Super Hornet/Growler production is likely in the past. Gibbons says the current annual production rate of 48 aircraft is likely to be cut by 25% next year and eventually lowered again, to 24 annually. Company officials are looking for lessons from a similar rate reduction in the C-17 transport, aiming to keep the per-unit Super Hornet price at $37 million (not including engines and electronic-warfare systems) while reducing the production rate. Including all government-furnished equipment, Gibbons says the Navy pays a $50 million flyaway price for the Super Hornet. A Growler is expected to cost about $9 million more.

The Eurofighter consortium is expected to face a similar decision for its Typhoon production infrastructure, with the last fighter scheduled to come off of the line in 2017. The Tranche 3 Typhoon had its first flight in early December, incorporating improved avionics computing power; fuel-dump and provisions for an active, electronically scanned array (AESA) radar; high-speed data network; fiber-optic weapons bus, and conformal fuel tanks. A Typhoon package with an improved radar is expected for delivery at the end of 2015.

Meanwhile, Saab is under contract to develop the JAS 39E production version of the Gripen NG demonstrator, first flown in 2008, and to modify 60 Swedish Gripen Cs to Gripen Es. Switzerland is expected to buy 22 Gripen Es in 2014. The upgraded fighter features an AESA radar, General Electric F414 engine and increased fuel and weapon loads.

Although losing in Brazil, the Rafale was selected as India's Medium Multi-Role Combat Aircraft (MMRCA) and France's modernization program. The contract for India's largest single defense buy to date, for 126 fighters, is not likely to be issued until April. At the same time, France has begun to take delivery of its latest, fourth-tranche, two-seat Rafales. They include the RBE2 AESA radar and upgraded missile-warning capability. An earlier version of the Rafale was instrumental in French operations in Mali, where the aircraft conducted aerial surveillance and ground-attack missions. The Rafale and Typhoon were also being eyed by the United Arab Emirates, but the UAE put Eurofighter negotiations on ice in December, and the status of Rafale talks was not clear.

Despite this activity, Paris has proposed slowing Rafale production to 26 aircraft over six years, from the current 11-aircraft annual rate.

Not unlike the Rafale, Lockheed Martin's F-16 is being modernized by several customers as well. Singapore will upgrade at least some of its F-16s while it considers purchasing the F-35. Singapore is expected to follow Taiwan and the U.S. in pursuing an AESA radar for the F-16. Northrop Grumman's Scaled Agile Beam Radar (SABR), based on the radars employed by the F-22 and F-35, has been selected by prime contractor Lockheed Martin for the F-16. The U.S. Air Force is also considering structural upgrades to get more flying hours out of its F-16s.

As these programs are relying largely on upgrades, the F-35 footprint continues to grow. In 2013, Italy officially started work at its final assembly and checkout (FACO) facility at Cameri Air Base in the country's northern industrial sector. The Italian government invested roughly $1 billion to construct the state-of-the-art FACO there, which is being operated under the leadership of Alenia Aermacchi.

Defense officials hope to establish a regional maintenance, repair and overhaul facility for European and Middle Eastern F-35s with some of the facility's excess capacity. The first F-35 from the FACO is expected to be delivered to Amendola Air Base in Italy in 2016.

Another FACO facility will be built by Japan's Mitsubishi Heavy Industries, according to an agreement signed last summer.

The F-35 took a major step in overcoming a thorny technical shortfall in October when the U.S. Joint Program Office ended its contract with BAE Systems to provide an alternative to the primary helmet-mounted display being built by Vision Systems International (VSI) (a joint venture between Elbit Systems and Rockwell Collins). The Pentagon started the alternative design, which would have employed a less sophisticated helmetmounted display, in 2011 due to persistent problems with jitter and the night-vision capability in high-stress conditions.

The fixes to VSI's original helmet will be incorporated into the so-called Gen-3 helmet and tested in the coming months. The Gen-3 helmet will be incorporated into the production system with low-rate, initial-production Lot 7 aircraft being delivered in 2016.

F-35 weapons testing is also moving forward: The three weapons required for the U.S. Marine Corps initial operational capability (IOC) decision have been dropped. They are the 500-lb. laser-guided bomb, 1,000-lb. Joint Direct Attack Munition and the AIM-120. F-35 program officials will continue to expand weapons testing, including guided test flights and more stressing conditions. They are hoping to wrap up testing for this trio of weapons in March 2015, to meet a possible IOC declaration in the summer of 2015.

For the most part, looking ahead to 2014, the fast-jet trainer market remains in largely the same shape as in recent years. This is primarily due to the U.S. Air Force's decision to delay buys of a T-38 replacement until 2015 or beyond; the slip was prompted by funding cuts imposed on the Pentagon. The service says it will buy 350 or more of the aircraft, and it hopes to keep costs down, possibly by purchasing an off-the-shelf option. As the lead-in trainer for the F-22 and F-35, the Air Force is looking for an integrated training system incorporating the cutting edge in ground-based simulation as well as airborne elements. Budget pressure in Washington is forcing the service to look for a low-cost option.

This could come from Boeing and Saab, which announced in late 2013 that they are teaming to design and build a brand-new aircraft for the forthcoming requirement. Though the design will not be a Gripen, team officials say it will draw on lessons from that aircraft in addition to Boeing's extensive fighter work.

The pair will take on a well-established field of competitors for the T-X program, including Northrop Grumman/BAE, offering the Hawk; General Dynamics/Alenia Aermacchi, offering the M-346 and Korea Aerospace Industries/Lockheed Martin, proposing the T-50.

Iraq announced in December that it will buy 24 F-50s, fighter versions of the T-50, in a deal valued at $1.1 billion. The Philippines is expected to order the type as well.

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