Defense Acquisitions: Use of Cost Reduction Plans in Estimating F-22 Total Production Costs
Abstract
I am pleased to be here today to discuss our ongoing work on the impact that production cost reduction plans are projected to have on the Air Force's F-22 Raptor Program. The F-22 Raptor is an air superiority aircraft being developed to replace F-15 fighter aircraft. Lockheed Martin Corporation and Pratt & Whitney Corporation are the contractors for the airframe and engine, respectively. Development, which started in 1991, is scheduled to be completed in August 2003. The Air Force plans to enter low-rate initial production in December 2000. Appendix I lists products we have issued that relate to the F-22 program. Projections of higher production costs have been a source of concern for several years. In 1996, because of potential cost increases, the Air Force established a team--known as the Joint Estimating Team--to review the total estimated cost of the F-22 program. The team concluded that the cost of production could grow substantially from the amounts planned, but that cost reduction initiatives could be implemented to offset that cost growth. The Office of the Undersecretary of Defense for Acquisition, Technology, and Logistics generally adopted the team's recommendations to change certain aspects of the program, as well as a plan to define and implement cost reduction initiatives. F-22 production costs were also discussed in the National Defense Authorization Act for Fiscal Year 1998 (P.L. 105-85, Nov. 18,1997). That act limited the total cost of F-22 production but did not specify the total number of aircraft to be procured. The most recent production costs estimates were completed by the Air Force and the Office of the Secretary of Defense in 1999. Both of these estimates considered cost reduction initiatives known as production cost reduction plans. Hundreds of these plans-totaling $21 billion--had been identified by the airframe and engine contractors, with participation by the Air Force's F-22 program office.
Document Details
- Document Type
- Technical Report
- Publication Date
- Jun 15, 2000
- Accession Number
- ADA378432
Entities
Organizations
- United States Government Accountability Office