Material Management

In response to a congressional request, GAO examined the repair of defective government-furnished material (GFM) for several naval aircraft to determine: (1) how often contractors repaired defective GFM; (2) the reasons for the repairs; and (3) the cost to the federal government.

GAO found that, of 1,366 contractor requests for Navy approval to repair defective GFM: (1) 61 percent involved material that the contractor ultimately repaired; (2) 9 percent involved material repaired at government facilities; and (3) most of the remaining 30 percent involved material that the original suppliers repaired. GAO noted that the federal government's cost to repair defective GFM at two contractors' plants was about one-half of 1 percent of the total cost of GFM it used. GAO also found that: (1) contractors made the repairs to avoid costly interruptions to aircraft production; (2) the cost to contractors or the federal government for the repair of defective GFM was negligible compared to cost increases that would have resulted from production line stoppages; and (3) the Navy had difficulty getting suppliers to pay for the repair or replacement of defective GFM because government plant representatives had inspected and accepted the items before the suppliers shipped them.