U.S. expects F-35 to be part of Canada's next jet competition

The Pentagon expects the new Canadian government to allow Lockheed Martin Corp's F-35 fighter aircraft to compete to replace Canada's aging CF-18 jets, despite the Liberal Party's stated opposition to the planes, U.S. Deputy Defense Secretary Bob Work said on Saturday.

But Work cautioned after talks in Canada that how the fledgling government sets its requirements for the competition would ultimately determine what jet the country gets.

"I think they're going to have another full and open competition. I think the F-35 will be part of that but the requirements from the competition may change. We don't know," Work told reporters traveling with him back from Canada.

Work's comments came a day after Canada's new Defense Minister Harjit Sajjan, in an interview with Reuters, said it would be "premature" to talk about the F-35 or any aircraft that might or might not be able to replace the CF-18.

"I'm focused on the requirements that we need ... as a nation that works with our allies as well, with NATO and our NORAD commitments," Sajjan said, referring to the North American Aerospace Defense Command.

A decision not to go with the F-35 could raise the prospects for Boeing Co's (BA.N) F/A-18E/F fighters.

Work said he only sounded out Sajjan when the two met in Halifax, Nova Scotia, adding: "I wasn't here to put any pressure on."

Canadian Prime Minister Justin Trudeau shook up his election campaign and the aerospace industry with his Sept. 20 announcement that he would not buy F-35s. He said he expected this to yield savings, which he would apply to naval ships.

But Canada, one of the nine countries in the initial F-35 partnership, pledged to invest $150 million in the program's development when it signed up in February 2002.

Those funds would not be reimbursed if Canada exits the program. Many Canadian firms that supply parts worth hundreds of millions of dollars to Lockheed each year could also lose those orders.

Joe DellaVedova, spokesman for the F-35 program office, said on Friday that Canada remained a partner in the program and was still slated to participate in a meeting of the program's executive steering board in Italy early next month.

"Similar to actions taken by other nations, the Government of Canada is working to launch an open and transparent competition to replace their legacy aircraft," he said.