"Military intelligence is a contradiction in terms." Or so the saying goes -- but sometimes, even the Pentagon gets it right. This is one of those times.

According to DefenseNews.com, the Pentagon has sealed the fate of General Electric's (NYSE: GE) so-called "alternative engine" for the Lockheed Martin (NYSE: LMT) F-35 fighter jet. As I mentioned in February, Air Force brass have been trying to kill this engine for years, hoping to salvage the billions it would have cost -- and reinvest them elsewhere. When you consider that:

  • the F-35 already has a perfectly good engine, built by United Technologies (NYSE: UTX)
  • duplicating it with a GE engine would add at least $2.9 billion to the program's cost (according to The Pentagon) …
  • and that it seems the folks in Congress who thought this was a good idea mainly hailed from states such as Indiana (which would benefit financially from the project) …

… it's hard to find fault with the Pentagon's decision. To the contrary, changing the March 24 stop-work order into a final and definitive "termination" of the project deserves praise.

GE shareholders will certainly disagree with the decision. But look on the bright side: Now GE has more free time available to build engines for the Boeing (NYSE: BA) 787. And isn't it more pleasant to build engines for customers who actually want to buy your product?

How will GE react to the Pentagon's decision? Where will it find revenues to replace those lost to United Tech? Keep in the loop by adding General Electric to your Fool Watchlist.