Controlling Costs for the F-35 Joint Strike Fighter

thumbnail_defenseFrom acquisition to operations and maintenance, Department of Defense weapons programs are consistently of interest to the federal government and the public. Since 2000, we have been assessing DOD’s most costly weapons program, the F-35 Joint Strike Fighter. The defense acquisition best practices we have developed have helped us recommend ways to control costs for such an ambitious program.

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Excerpted from GAO-14-340SP

Our best practices for defense acquisitions are rooted in best practices for product development in general. They emphasize the importance of being able to demonstrate high levels of product knowledge at critical points in the acquisition process—unknowns at these critical junctures can cause cost growth and delays going forward. These “knowledge points” align with key decision points (“milestones”) in the acquisition process. Here are the three key “knowledge points” we’ve identified for defense acquisitions:

  1. Development start
  2. Design review
  3. Production start

In examining how world-class commercial companies managed new product development, we found that development start was the decision point with the greatest effect on the trajectory of the program. We also found that clearly defining program requirements and early in the acquisition process is critical to achieving cost, schedule, and performance goals. The figure below illustrates our best practices framework mapped onto DOD’s acquisition cycle.

 dod2

Excerpted from GAO-14-340SP

In the case of the F-35, we found that DOD made decisions at key milestones without adequate knowledge. It has become a signature case study of a program that passed key decision milestones without meeting best practice standards, encountering significant cost and schedule problems as a result. As of March 2013, the total estimated program acquisition cost had grown nearly $160 billion, or 68 percent, since the program’s initial estimate in 2001. The start of full rate production had slipped 7 years.

Our 2014 annual report on the F-35 found that delays in developmental flight testing could hinder delivery of capabilities the military services expect for initial operations. Additionally, in September 2014, we noted that the F-35’s annual operating and support costs are estimated to be considerably higher than the combined annual costs of other legacy aircraft, as shown in the figure.

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Excerpted from GAO-14-778

The report included recommendations to determine reasonable affordability targets; mitigate operations and support risks; and improve cost estimate reliability.

Listen to our podcast with Cary Russell, a director in our Defense Capabilities Management team who led the review of F-35 sustainment costs:


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