• Turkish President Recep Tayyip Erdoğan said he expects positive news on a deal to acquire U.S. F-35 fighter jets and American-made engines for Turkey's KAAN fighter program.
  • President Donald Trump indicated he will soon decide on the F-35 sale despite a congressional ban and plans to lift sanctions imposed over Turkey's purchase of a Russian S-400 air defense system.
  • A potential deal could reshape U.S.-Turkey defense ties and regional air power dynamics, but faces congressional skepticism.

Fragile Prospects

Turkish President Recep Tayyip Erdoğan on Thursday signaled a potential breakthrough in long-stalled talks with the United States over the purchase of F-35 fighter jets and American-made engines for Turkey's domestic KAAN fighter program. Speaking to reporters in Ankara, Erdoğan said he expects "positive news" soon, without elaborating on specifics. The comments come as President Donald Trump told allies he will make a decision on the F-35 sale in the coming days and is considering lifting sanctions tied to Turkey's acquisition of a Russian S-400 missile defense system, according to people familiar with the matter.

The developments mark a sharp shift in a relationship that has been strained since 2019, when the U.S. removed Turkey from the F-35 program over national security concerns about the S-400. Turkey maintains the system is not integrated with NATO hardware and has pushed for reinstatement. Trump's willingness to revisit the issue, despite a congressional ban on F-35 transfers to Turkey, suggests a broader effort to repair defense ties with Ankara, a key NATO ally.

Domestic Ambitions, Foreign Engines

Turkey's KAAN fighter, a domestically developed fifth-generation stealth jet, is central to the country's ambitions for military self-sufficiency. But the program has been hamstrung by a lack of suitable engines. Turkish officials have long sought American-made powerplants from General Electric (GE) as a preferred option. "Without an engine deal, the KAAN program would face significant delays," noted a defense analyst familiar with the matter. A breakthrough on F-35s and engine supplies could give Turkey a major boost, though full operational capability remains years away.

Political and Market Reactions

News of the potential thaw sent shares of Lockheed Martin (LMT), the F-35's prime contractor, up 1.2% in early trading on Friday. The Turkish lira strengthened slightly against the dollar, reflecting cautious optimism among investors. Still, hurdles remain. U.S. lawmakers from both parties have voiced opposition to sanction relief without verifiable steps from Turkey to limit the S-400's use. A senior Senate aide said any deal would require "credible assurances" that the system will not be activated against NATO assets.

Efforts to reach the Turkish defense ministry for comment were unsuccessful. The U.S. State Department declined to comment on ongoing discussions. A decision is expected within weeks, though the timeline remains fluid.

*Correction: An earlier version of this article misstated the timing of Turkey's removal from the F-35 program. It was 2019, not 2018.