Army Logistics

The Army manages more than 37,000 items that require depot-level repair to keep its aircraft, vehicles, weapons, and support equipment up-to-date and combat-ready. These items are designated as "repairable" because generally it is more economical to repair rather than replace them. This report examines the Army's efforts to return assets in need of repair to reduce procurement costs and improve military readiness. GAO discovered that Army units returned fewer assets for repair than expected, which resulted in the purchase of additional assets to fill user demands.

GAO found that: (1) the Army is purchasing additional assets and reducing the quantity of assets scheduled for repair because returns are not meeting its minimum goal; (2) four of the Army's six inventory control points were buying between $369 million and $815 million of assets that would not have been necessary if returns had been at the 85-percent goal; (3) one inventory control point, the Army Missile Command, improved returns management by identifying items with low returns and requiring item managers to determine the causes and report on the actions taken to improve them, visiting users to reinforce the need to promptly turn in reparable assets, and providing monthly management updates on the progress in improving rates; (4) the Army reported a return rate of 75 percent for fiscal year 1990, but this figure does not accurately reflect the program's effectiveness, since the return-rate goal was based on computations of historical rates without a detailed analysis of what the rate should be; and (5) the Army does not yet have a materiel returns program that optimizes its goal to reduce inventory costs and maximize military readiness.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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