Has the Real Cost of Fighter Planes Risen Over Time?

The question I just asked may seem rhetorical, since, for all the sniveling of that species of political hack that calls itself "economist," virtually all those living today have never known any but an inflationary era. And even compared with the general upward trend of prices (in contrast with, for example, the stagnation of wages for a half century now), the rising cost of major weapons systems like fighter aircraft is, like the rising cost of higher education or health care, beyond notorious--not least to those expert in such matters.

Still, broad impressions are one thing, specific information another, much rarer thing, and it is the latter that concerns me here--actually checking what we all "know," or think we know.

That requires me, of course, to come by actual cost estimates, on the basis of which one might properly make such judgments.

Just like everything else, this is easier said than done.

Much easier.

Given the tendency to multiple versions of a single aircraft type, which can be expected to have different features (are we talking the A or the J here?); the changes in the cost of even the exact same version during its life cycle (as we go from early projections to actual realities, where costs are amortized and production processes get more efficient but orders also get cut back, along with everything else that can affect industrial life); and the multiplicity of ways to go about the accounting (are we speaking of the production cost of single aircraft, or the overall program cost?); one easily finds multiple price estimates for the same plane.

Moreover, those presenting these estimates do not always give the source of the figure they are citing, let alone when and how it was arrived at, and I have found few attempts at either a comprehensive listing of estimates for single aircraft, or a sophisticated averaging out of costs for a type.

This is all headache enough when one is talking about current aircraft, as we see with the F-35--which, this past December, we were told would cost both $89 million, or $300 million, per unit. It is worse when we are looking for data on older aircraft which have gone through more years and more models in production. (Only four F-35 variants have been produced to date; but according to the Wikipedia page dedicated to just listing them, no fewer than fifty-one F-4 variants have actually been produced.) There is the problem of adjusting old figures for inflation--adjusting what may well be a "rough" estimate with another rough estimate.

And of course, as the whole point of this particular exercise is a comparison among aircraft, the difficulty of establishing whether two similar-looking planes are really comparable. (Whether a fighter is meant to take off from and land on carriers, for instance, can really complicate the issue, given the special engineering they require.)

Still, one can hardly avoid the exercise; and even a rough estimate may yield insight if a trend is pronounced enough.

For the sake of keeping things as simple as possible I stuck with U.S. Air Force jet fighters that went into wide enough production to be considered the standard type of their period, and a listing which afforded rare attention to differences among models of the same plane.

Turning to figures from Richard Knaack's Encyclopedia of USAF Aircraft and Missile Systems, however, one does see quite a number of figures for, among other things, fighter jets from the 1940s to the 1970s, nicely covering the first three generations of the system at least. Given his cost estimates for early production types, the first Air Force production jet, the P-80, ran a little over $1.5 million per unit in 2019 dollars; the more advanced but still first generation F-86A, around $1.9 million.

The Air Force did produce a more advanced F-86 with a radar and afterburning engine, the D model, but such features arguably make it already a second generation aircraft. This ran $4 million a unit.

As this indicates generational boundaries can be tricky, with a comparison of the F-104 and F-4 fighters clarifying the issue. The two are thought second and third-generation respectively, but both are Mach-2 capable, radar-equipped, missile-armed fighters that flew just a couple of years apart (the first F-104 flight 1956, the first F-4 flight 1958). The most obvious difference between one and the other, in fact, is the F-4's being a bigger, heavier, twin-engined plane bearing a heavier armament--so that a case can be made for thinking of the two as generationally comparable "light" and "heavy" fighters (like the F-16 and F-15 were in their original versions). As it happens, the prices of the systems reflected this proximity--the F-104G running $12 million, the early third-generation F-4 $16 million in its C version and $20 million in its E version.

I had to turn to other sources for later aircraft. However, the fourth-generation F-15 (the prices of classes A through D varying surprisingly little) is commonly estimated to cost something in the range of $45 million per aircraft. The F-22 is similarly estimated to run $200-$300 million in today's terms--roughly what the F-35, despite its lower performance, delayed appearance and far larger planned production run (a possible 4,000 units), may also cost.

The result is that a single F-22 cost a hundred or more times what a first generation jet did; ten or more times what a second/third generation jet did; four or more times what a fourth generation jet did.

In short, a generational jump went along with at least a doubling of prices--and sometimes much more than a doubling. Using the 1945 price of the P-80 and the 1998 price of the F-22 as benchmarks, it seems that the inflation-adjusted price of the latest fighter aircraft rose 10 percent a year. This is a doubling time of every seven years or so.

Looking back the most rapid period of price increase would seem to have been the two decades or so after the first jets appeared, when their evolution was most dynamic--going from subsonic planes with optically aimed guns to supersonic aircraft firing pulse Doppler radar-guided missiles beyond visual range. However, as the price gap between even the most advanced F-4 derivative and the F-22 or F-35 demonstrates, major leaps remained in store, so much so that along with the diminished intensity of procurement the end of the Cold War brought, the F-22 remained the most advanced jet in the world, while never even really replacing the fourth generation, the F-15s and F-16s not only still the U.S. Air Force's mainstay a near half century after their own first flights (1972 and 1974, respectively), but expected to continue in frontline service for decades more.

Moreover, while it may seem that the trend ran its course by the turn of the century, the widespread interest in a sixth generation fighter suggests that we will eventually be seeing cost estimates. If past experience is anything to go by, I would consider a half billion dollar plane each surprisingly cheap, an individual price tag of a billion or more (maybe much more) strongly probable.

All too predictably, however, none of those chattering about these aircraft seem to be talking about that bill . . .