Tactical Aircraft
DOD Should Present a New F-22A Business Case before Making Further Investments Gao ID: GAO-06-455R June 20, 2006The F-22A is the Air Force's next generation air superiority fighter aircraft. It incorporates a low observable (stealth) and highly maneuverable airframe, advanced integrated avionics, and a new engine capable of sustained supersonic flight without the use of afterburners. It was originally designed to counter threats posed by the Soviet Union and was intended to replace the F-15 fighter in the air-to-air combat role. However, the Air Force now plans to add a more robust ground attack and intelligence- gathering capability not previously envisioned but now considered "necessary" to increase the utility of the aircraft. In December 2005, the Air Force changed designations from the F/A-22 to the F-22A. The aircraft maintained all current capabilities as well as the expanded ground attack capabilities. Officials have initiated a modernization program to develop and integrate these new capabilities. In March 2005, we reported that despite substantial changes to the F-22A program since it started in 1986, Air Force leaders have not developed a new business case for investing billions more dollars to modernize the aircraft. Over time quantities have been reduced, and in recent years both funding and quantities have been in a state of flux. Given significant changes in quantities and planned capabilities, the large investments still planned, and the potential for further changes, Congress requested that we review the F-22A program. Specifically, we assessed the need for a new business case before further investments are made in the F-22A program and statutory criteria the Air Force is required to meet to enter a multiyear contract for the remaining aircraft. To assess the Air Force's business case for further investments in the F-22A program, we reviewed recent Office of the Secretary of Defense Program Budget Decisions (PBDs) and F-22A requirements documents. We also reviewed F-22A planned modernization schedules and documents and interviewed program officials from the F-22A program office, Air Combat Command, and the Air Force Program Executive Officer for Tactical Air. To assess the Air Force's proposed use of a multiyear contract for the remaining F-22As, we compared program documentation on cost, schedule, and performance with statutory criteria for entering into a multiyear contract. We conducted our review between August 2005 and April 2006 in accordance with generally accepted government auditing standards.
Based on our review, in our opinion, the DOD has not demonstrated the need or value for making further investments in the F-22A program. The Air Force's current stated "need" is for 381 F-22As to satisfy air-to-air missions and recently added requirements for more robust ground attack and intelligence-gathering capabilities. However, because of past cost overruns and current budget constraints, the Office of the Secretary of Defense (OSD) states that it can now afford only 183 F-22As. This leaves a 198-aircraft gap between the Air Force's stated need and what is currently affordable. The Air Force is planning to invest about $4.4 billion through 2011 to add more robust ground attack and intelligence gathering capabilities for the F-22A. However, because of the large aircraft gap between stated Air Force requirements and current and future budget realities, it may not be prudent to make additional investments for these new missions and capabilities. Furthermore, alternatives such as the Joint Strike Fighter and F-15 might be able to execute ground attack more cost-effectively given the substantially fewer numbers of F-22As that OSD has committed to buy. In December 2005, OSD restructured the F-22A program by extending production to 2010, adding 4 aircraft for a total planned procurement of 183 F-22As and adding $1 billion to the procurement program. Under the restructured acquisition program, the Air Force is planning to procure a total of 60 F-22As in a multiyear procurement. However, in the Air Force's multiyear procurement justification package sent to Congress on May 16, 2006, it stated that an additional $674 million is needed to fully fund the multiyear program being proposed. Our work led us to make observations on issues that could affect the Air Force's ability to satisfy several of the statutory criteria for entering into a multiyear contract, including the documentation of savings, a stable design, and available funding.
RecommendationsOur 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.
Director: Team: Phone:GAO-06-455R, Tactical Aircraft: DOD Should Present a New F-22A Business Case before Making Further Investments
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United States Government Accountability Office:
Washington, DC 20548:
June 20, 2006:
The Honorable C.W. Bill Young:
Chairman:
Subcommittee on Defense:
Committee on Appropriations:
House of Representatives:
Subject: Tactical Aircraft: DOD Should Present a New F-22A Business
Case before Making Further Investments:
Dear Mr. Chairman:
The F-22A is the Air Force's next generation air superiority[Footnote
1] fighter aircraft. It incorporates a low observable (stealth) and
highly maneuverable airframe, advanced integrated avionics, and a new
engine capable of sustained supersonic flight without the use of
afterburners. It was originally designed to counter threats posed by
the Soviet Union and was intended to replace the F-15 fighter in the
air-to-air combat role. However, the Air Force now plans to add a more
robust ground attack and intelligence-gathering capability not
previously envisioned but now considered "necessary" to increase the
utility of the aircraft. In December 2005, the Air Force changed
designations from the F/A-22 to the F-22A. The aircraft maintained all
current capabilities as well as the expanded ground attack
capabilities. Officials have initiated a modernization program to
develop and integrate these new capabilities.
In March 2005,[Footnote 2] we reported that despite substantial changes
to the F-22A program since it started in 1986, Air Force leaders have
not developed a new business case for investing billions more dollars
to modernize the aircraft. Over time quantities have been reduced, and
in recent years both funding and quantities have been in a state of
flux. Given significant changes in quantities and planned capabilities,
the large investments still planned, and the potential for further
changes, you requested that we review the F-22A program. Specifically,
we assessed the need for a new business case[Footnote 3] before further
investments are made in the F-22A program and statutory criteria the
Air Force is required to meet to enter a multiyear contract for the
remaining aircraft.
To assess the Air Force's business case for further investments in the
F-22A program, we reviewed recent Office of the Secretary of Defense
Program Budget Decisions (PBDs) and F-22A requirements documents. We
also reviewed F-22A planned modernization schedules and documents and
interviewed program officials from the F-22A program office, Air Combat
Command, and the Air Force Program Executive Officer for Tactical Air.
To assess the Air Force's proposed use of a multiyear contract for the
remaining F-22As, we compared program documentation on cost, schedule,
and performance with statutory criteria for entering into a multiyear
contract. We conducted our review between August 2005 and April 2006 in
accordance with generally accepted government auditing standards.
Summary:
Based on our review, in our opinion, the DOD has not demonstrated the
need or value for making further investments in the F-22A program. The
Air Force's current stated "need" is for 381 F-22As to satisfy air-to-
air missions and recently added requirements for more robust ground
attack and intelligence-gathering capabilities. However, because of
past cost overruns and current budget constraints, the Office of the
Secretary of Defense (OSD) states that it can now afford only 183 F-
22As. This leaves a 198-aircraft gap between the Air Force's stated
need and what is currently affordable. The Air Force is planning to
invest about $4.4 billion through 2011 to add more robust ground attack
and intelligence gathering capabilities for the F-22A. However, because
of the large aircraft gap between stated Air Force requirements and
current and future budget realities, it may not be prudent to make
additional investments for these new missions and capabilities.
Furthermore, alternatives such as the Joint Strike Fighter and F-15
might be able to execute ground attack more cost-effectively given the
substantially fewer numbers of F-22As that OSD has committed to buy.
In December 2005, OSD restructured the F-22A program by extending
production to 2010, adding 4 aircraft for a total planned procurement
of 183 F-22As and adding $1 billion to the procurement program. Under
the restructured acquisition program, the Air Force is planning to
procure a total of 60 F-22As in a multiyear procurement. However, in
the Air Force's multiyear procurement justification package sent to
Congress on May 16, 2006, it stated that an additional $674 million is
needed to fully fund the multiyear program being proposed. Our work led
us to make observations on issues that could affect the Air Force's
ability to satisfy several of the statutory criteria for entering into
a multiyear contract, including the documentation of savings, a stable
design, and available funding.
We believe the Congress should consider withholding additional funding
for procurement and modernization until the Department completes a
comprehensive business case that addresses the concerns we have raised
herein. In response to a draft of this report, the Department stated
that a recently completed Joint Air Dominance (JAD) study conducted by
DOD adequately identified the quantity and mix of tactical aircraft
needed and thus already satisfied the intent of our recommendation. We
have asked OSD to provide us access to the JAD study, but it has not
yet done so. We plan to pursue this matter with the Department.
However, because Congressional deliberations on this issue are ongoing,
we believe it is important to provide the data and analysis in the
report at this time. Given the way this program has unfolded, with
frequently changing OSD-approved requirements, repeated cost overruns,
and given that DOD did not object to the data and analysis contained in
the report, we are not changing our matter for Congressional
consideration. If Congress does decide to provide more funding for the
F-22A program, that funding should be conditioned on DOD providing the
JAD study and subjecting it to independent review to ensure that it
provides adequate justification for sound investment of taxpayer
resources.
Background:
The F-22A began development in 1986 to replace the F-15 air superiority
aircraft. The continued need for the F-22A, the quantities required,
and modification costs to perform its mission have been the subject of
a continuing debate within DOD and the Congress. Supporters cite its
advanced features--stealth, supercruise speed, maneuverability, and
integrated avionics--as integral to the Air Force's Global Strike
initiative and for maintaining air superiority over potential future
adversaries.[Footnote 4] Critics argue that the Soviet threat the
fighter was originally designed to counter no longer exists and that
its remaining budget dollars could be better invested in enhancing
current air assets and acquiring new and more transformational
capabilities that will allow DOD to meet evolving threats. The Air
Force has already committed funds to acquire 122 F-22As. To complete
the procurement program, it now plans to buy the remaining F-22As using
a 3-year multiyear contract that ends procurement in 2010. To begin the
multiyear strategy, the Air Force has included $2.0 billion for advance
procurement of parts and subassembly activities in its fiscal year 2007
budget request. Additionally, it has included $800 million for
continuing development and modifications of existing aircraft.
DOD Has Not Completed a New Business Case to Justify Further
Investments in the F-22A Program:
The Air Force's business case for the F-22A program is unexecutable as
planned because there is a significant mismatch between the Air Force's
stated "need" for the F-22A aircraft and the resources OSD is willing
to commit. According to Air Force officials, a minimum of 381 F-22A
aircraft are needed to satisfy today's national security requirements,
yet OSD states it can only afford to buy 183 F-22A aircraft. This
results in a 198-aircraft gap in capability. Additionally, the Air
Force now states a "need" for greater ground attack and intelligence-
gathering capabilities, not included in the existing business case that
will require an extensive modernization program. The value of this
planned investment in modernization is highly questionable absent a new
business case that supports the minimum capability-based need, given
credible current and future threats, and that considers various options
that are both affordable and sustainable over time.
The Air Force states a need for one squadron of 24 F-22A aircraft for
each of the 10 Air Expeditionary Forces, the planned organization of
the Air Force aircraft and personnel for operations and deployments.
This requirement is established to carry out missions including support
in major regional conflicts, home land security, and others. According
to the Air Force, this requires a total of 381 F-22As, 240 primary
aircraft and 141 aircraft for training, attrition, and to allow for
periodic aircraft depot maintenance.
OSD has restructured the F-22A acquisition program twice in the last 2
years (in December 2004 and December 2005) to free up funds for other
priorities. These decisions have created a mismatch between the Air
Force's stated requirements and what OSD considers an affordable
quantity of F-22As. In December 2004, OSD reduced the program to 179 F-
22As to save about $10.5 billion. This budget decision also terminated
procurement in 2008. Then in December 2005, OSD changed the F-22A
program again, adding $1 billion to extend production for 2 years to
ensure a 5TH generation fighter[Footnote 5] aircraft production line
would remain in operation in case the Joint Strike Fighter experienced
delays or problems. OSD also added 4 aircraft for a total planned
procurement of 183 F-22As.
The Air Force is currently planning to provide the F-22A with greater
ground attack and intelligence-gathering capabilities. It estimates
these will cost about $4.4 billion between 2005 and 2011. It is also
planning additional modernization efforts for more of these
capabilities in the future, but the cost, content, and timing has not
yet been determined. However, the 198-aircraft gap between the Air
Force's stated "requirement" and the planned procurement quantities
raises questions on whether the F-22A will be able to carry out its
planned missions. The Air Force is buying less than half the required
381 aircraft to fill out its planned organizational structure--
necessary to carry out planned air-to-air, ground attack, and
intelligence-gathering missions. Other alternatives could be available
to carry out the ground attack and intelligence gathering capabilities.
For example, DOD is also investing billions of dollars to develop the
Joint Strike Fighter aircraft--a 5TH generation fighter-intended for
ground attack and billions of dollars to develop intelligence,
surveillance, and reconnaissance platforms and sensors.
Air Force Is Requesting to Use a Multiyear Contract for the F-22A:
The Air Force is proposing to buy the remaining 60 F-22As over a 3 year
period with a multiyear contract and submitted its justification to the
Congress on May 16, 2006.[Footnote 6] To enter into a multiyear
contract the Air Force must first meet the statutory criteria listed in
10 U.S.C. § 2306b (a). Table 1 shows the six criteria that must be
satisfied before entering into a multiyear contract and our
observations on issues that could affect the Air Force's ability to
satisfy several of the criteria.
Table 1: Observations of F-22A Multiyear Contract Criteria as of April
2006:
Multiyear criteria: Contract will result in substantial savings;
GAO observations: The Air Force has not completed an estimate of
savings, but its preliminary indications are a maximum of 5 percent
savings. However, when the unit procurement costs for the planned
multiyear approach is compared to how the Air Force had previously
planned to buy the remaining aircraft, the unit procurement costs
increase under multiyear.
Multiyear criteria: Minimum need expected to remain substantially
unchanged during contract period in terms of production rates and total
quantities;
GAO observations: Quantities have continually been in a state of flux
in the F-22A program including changes in the last two budget
submissions.
Multiyear criteria: Reasonable expectation agency head will request
funding at required level to avoid contract cancellation;
GAO observations: The Air Force has indicated that its multiyear budget
is currently under funded by $674 million. Further, it is proposing to
use incremental funding rather than fully funding each aircraft lot.
Multiyear criteria: There is stable design, and technical risks are not
excessive;
GAO observations: While the design for the baseline F-22A aircraft,
designed primarily for an air superiority role, is stable, the design
for the ground attack capability to be added has not been demonstrated
and thus cannot be considered "stable.".
Multiyear criteria: Estimates of contract cost and cost avoidance are
realistic;
GAO observations: The Air Force has not completed its analysis of
contract cost or cost avoidance at this time.
Multiyear criteria: Use of contract will promote national security of
the United States;
GAO observations: No observation.
Source: GAO Analysis and 10 U.S.C. 2306b.
[End of table]
The Air Force has requested statutory authorization for a multiyear
contract for the remaining F-22As as part of the fiscal year 2007
authorization and budget process in order to award the contract in
early 2007. As shown in the table above, we believe there are some
critical considerations that need to be addressed before the multiyear
plan can be justified. These include the following considerations:
Savings--The Air Force stated in its May 16, 2006, multiyear
justification package that cost avoidance would approximate $225
million or about 2.7 percent. This is based on comparing three annual
contracts to a single multiyear contract to buy 56 aircraft. The
document also identifies a need for an additional $674 million to fully
fund a 60 aircraft multiyear contract as was proposed in the fiscal
year 2007 President's budget. While building an estimate for three
separate annual contracts provides a basis to compare to a multiyear
approach, it is not how the Air Force had previously planned to buy the
aircraft remaining in the F-22A program. The fiscal year 2006
President's Budget included procurement costs to buy the remaining 56 F-
22As in two lots--29 F-22As in 2007 and 27 F-22As in 2008. If the unit
procurement costs of this previous plan are compared to the planned
multiyear procurement unit costs for 60 aircraft as proposed in the
fiscal year 2007 President's Budget, the unit costs increase by 10
percent. In other words, the unit procurement costs increase from $166
million per aircraft to $183 million per aircraft for the proposed
multiyear contract.
Funding--The Air Force has stated that the proposed multiyear plan for
60 aircraft is under funded by about $674 million. The Air Force
believes it will need these funds in fiscal years 2009 and 2010.
Additionally, the Air Force has proposed using incremental funding to
pay for the multiyear contract. Instead of fully funding the buy for
each fiscal year, it plans four funding increments--economic order
quantity, advanced buy, subsystem, and final assembly. Incremental
funding for multiyear procurement is neither permitted by the annual
DOD appropriations act,[Footnote 7] nor the multiyear authorizing
statute which requires that funds only be obligated under a multiyear
contract "for procurement of a complete and usable end item."[Footnote
8] However, the Air Force is seeking an exception to these requirements
in its request to Congress for statutory authorization for the
multiyear contract. The Air Force's proposed F-22A multiyear strategy
includes an increment of funding in each fiscal year to begin
manufacturing subsystems, not considered a complete and useable end
item. For example, the fiscal year 2007 budget request includes $1.5
billion for subassemblies. It would not be until fiscal year 2008 that
the final assembly would be fully funded.
Design Stability--The baseline F-22A aircraft, designed primarily for
the air superiority role, has successfully completed development and
initial operational testing, and its design is stable for that
particular mission. However, the Air Force has stated that to be
"effective" in the future a more robust ground attack capability is
needed for the F-22A. It plans to spend several billions of additional
dollars to add this ground attack capability. A key to the success of
this effort is the development and integration of a new radar. The Air
Force expects to take delivery of the first aircraft with the new radar
in November 2006 but the software needed to provide the robust ground
attack capability will not be completed until 2010. According to a
representative of the Director, Operational Test and Evaluation
(DOT&E), the key to achieving a more robust ground attack capability
will center on the integration of this new radar. A December 2005
report issued by the Defense Contract Management Agency stated that
problems encountered during the test and integration of the new radar
has added risk to the development program. Until software and
integration testing in the F-22A have been successfully completed, we
consider the design unstable creating the potential for significant
cost overruns and schedule delays.
Conclusions:
The F-22A development has spanned more than a 19-year period during
which time requirements have changed both in terms of the quantity of
aircraft needed and the capabilities that would be incorporated. At the
same time, new budgetary constraints have grown and other priorities
have come to the forefront in DOD, including the need for funding the
war on terrorism. While the Air Force's stated need is 381 F-22As, OSD
will commit to fund only 183. The Air Force also states the basic
capabilities developed for the F-22 are not sufficient to be effective
in the current and future national security environment. The conditions
facing the F-22A program are significantly different than those
addressed by the original business case, yet despite these significant
changes the Air Force has not developed a new business case to justify
currently planned and proposed additional investments in the F-22A.
Given our nation's growing fiscal challenges, the changing security
threats, and prevailing best business practices for acquisitions, it is
highly questionable whether it is prudent to continue in the current
path proposed by the Air Force. DOD must begin to make the difficult
choices required to counter current and credible future threats at
current and expected future resource levels because it will not have
enough money to purchase everything that it wants. Furthermore, going
to a multiyear procurement strategy appears to be more costly than
previous Air Force plans and would tie up significant amounts of funds
at a time when DOD already has more wants than it is likely to be able
to afford and sustain over time. The Department needs to reevaluate the
value delivered by continuing production of the F-22A past what it has
already committed to by examining the likely future threat and risk
environment, the funding it can make available relative to other
demands, and the alternative ways to achieve air-to-air and air-to-
ground military superiority.
Matters for Congressional Consideration:
Because of the large disparity between what the Air Force wants for the
F-22A program and what OSD has committed to fund, there is a
significant break in the business case to justify buying more F-22As.
For this reason, Congress may want to consider withholding additional
funding for procurement and modernization until the Department
completes a comprehensive business case that addresses the concerns we
have raised herein. The additional issues surrounding this matter and
our reporting are discussed in the Agency Comment section of this
report.
Recommendation:
Because of the significant and continuing changes in the F-22A program
that have created an environment of investment uncertainty as well as
the significant mismatch between stated Air Force needs and wants and
future resource levels, we recommend that Secretary of Defense delay
further investments in F-22A procurement and modernization until it
completes a comprehensive business case analysis that adequately
considers alternatives, justifies the need for further investments, and
reconciles the numbers of F-22As that are needed (i.e. based on
credible current and future threats and considering other alternative
approaches) as well as affordable and sustainable (i.e., based on
current and expected DOD resource levels).
Agency Comments and Our Evaluation:
In written comments on a draft of this report, DOD stated that it did
not concur with our recommendation that the Secretary of Defense delay
further investments in F-22A procurement and modernization until it
completes a new business case analysis that adequately considers
alternatives, justifies the need for further investments, and
reconciles the numbers of F-22As that are needed. They stated a Joint
Air Dominance (JAD) study conducted by DOD adequately identified the
quantity and mix of tactical aircraft needed. DOD stated that delaying
investments in the F-22A would disrupt production and create program
instability. DOD also stated that keeping the F-22A production line
active, preserves the Department's options and sustains the industrial
base for efficient transition to Joint Strike Fighter production.
Preserving options and the industrial bases will be costly. The 2007
future year's defense plan added $1.05 billion for a 60 aircraft
multiyear procurement contract and subsequently the Air Force
identified an additional $674 million needed to fully fund this plan.
Therefore, the total additional multiyear procurement cost is $1.724
billion. Furthermore, it will add two years to the F-22A procurement
program. This represents significant opportunity cost. That is, the
funding used here will not be available to support other DOD
priorities. If preserving options and the industrial base are primary
reasons for these added costs and the extension of the procurement
program, DOD should make them more transparent to the Congress as it
seeks authorizations and appropriations to execute this plan.
As to the Department's position that they have already conducted the
business case called for in our recommendation, we asked OSD to provide
us access to the JAD study, but they have not yet done so. Because
Congressional deliberations are ongoing, we believe it is important to
provide the data and analysis in the report at this time. Given the way
this program has unfolded, with frequently changing OSD-approved
requirements, repeated cost overruns, and delays in fielding capability
to the warfighter, and given that DOD did not object to the data and
analysis contained in the report, we are not changing our matter for
Congressional consideration. If Congress does decide to provide more
funding for the F-22A program, that funding should be conditioned on
DOD providing the JAD study and subjecting it to independent review to
ensure that it provides adequate justification for sound investment of
taxpayer resources.
- - - - -:
We are sending copies of this report to the Secretary of Defense; the
Director, Office of Management and Budget; and interested congressional
committees. We will also make copies available to others upon request.
In addition, the report will be available at no charge on the GAO Web
site at [Hyperlink, http://www.gao.gov].
Should you or your staff have any questions on matters discussed in
this report, please contact Michael Sullivan on (202) 512-4163 or
Michael Hazard on 937-258-7917. Principal contributors to this report
were Marvin Bonner and Daniel Chen.
Sincerely:
Signed by:
David M. Walker:
Comptroller General Of the United States:
Enclosure:
Comments from the Department of Defense:
Deputy Under Secretary Of Defense:
3015 Defense Pentagon:
Washington, D.C 20301-3015:
Acquisition And Technology:
June 8, 2006:
Mr. David M. Walker:
Comptroller General of the United States:
U.S. Government Accountability Office:
441 G Street, N.W.
Washington, D.C. 20548:
Dear Mr. Walker:
This is the Department of Defense (DOD) response to the GAO draft
report, `Tactical Aircraft: DOD Should Present a New F-22 Business Case
Before Making Further Investments,' dated May 8, 2006 (GAO Code 120474/
GAO-06-455R).
The Department does not agree with draft GAO report's recommendation to
delay further investment in the F-22. While the Department agrees with
the GAO's emphasis on the importance of supporting our procurement
decisions with appropriate "Business Case" analysis, we have performed
such analysis to support F-22 and tactical aircraft force structure
decisions, and will continue to do so. Additional information and
rationale for the Department's position is summarized below.
Implementing the GAO's recommendation to delay investment in the F-22
would disrupt production and create program instability. This
instability would be detrimental to our nation's defense capabilities
and our tactical aircraft industrial base. Over the past several
procurement lots, the Air Force has been very successfully working with
the prime contractor to drive down costs. Unit flyaway costs have come
down 35% between Lot 1 and Lot 5. If stopped, production re-start would
be very costly and difficult to resume, breaking this positive trend.
Likewise, there is considerable modernization work ongoing. To stop
this work would result in large termination costs and would be very
costly to resume. Multiple GAO reports have noted the negative impact
that program instability has on program cost, schedule, and
performance.
The assumptions on which the GAO's recommendations are based were not
understood. The quantity and mix of tactical aircraft to be procured by
the Department has been and remains an area of significant "Business
Case" analysis. As the geopolitical and fiscal environment changes, we
continually reassess national security requirements and adjust our
force structure as needed. Keeping the F-22 production line active,
preserves the Department's options and sustains the industrial base for
efficient transition to Joint Strike fighter production.
To support the Quadrennial Defense Review and preparation of the
President's Fiscal Year 2007 Budget (PB07), the Department performed a
Joint Air Dominance (JAD) Study. The JAD Study examined options for
varying levels within the strike fighter mix. The Department looked at
the war scenarios and cost implications of buying fewer variants of
Joint Strike Fighters, increasing and decreasing the number of F-22s,
and buying more legacy aircraft at the expense of fewer fifth
generation platforms. The results of these analyses are reflected in
PB07, which sets forth a balanced portfolio of tactical aircraft
assets, including Joint Strike Fighter, F-22 and F/A-18E/F. The draft
GAO report makes note of, "the large disparity between what the Air
Force wants for the F-22A program and what OSD has committed to fund,
there is a significant break in the business case to justify buying
more F-22As." The 381 aircraft the Air Force analysis indicates are
required is a fiscally unconstrained projection of Service needs. The
QDR analysis reflects fiscal realities and the need to address
competing defense priorities. The JAD analysis showed that a balanced
force structure mix of fifth generation fighters, with legacy F/A-18E/
Fs, F-15Es and conventionally armed bombers, best met our requirements.
Buying fifth generation tactical aircraft assets (F-22 and JSF), for
both the Air Force and the Department of the Navy, optimized
capability, affordability, and mitigated risk better than other
options.
A detailed response is attached.
Thank you for the opportunity to respond to this draft report.
Signed by:
James I. Finley:
Attachments:
As stated:
GAO Draft Report - Dated May 8, 2006 Gao Code 120474/gao-06-455r:
"Tactical Aircraft: DOD Should Present A New F-22 Business Case Before
Making Further Investments"
Department Of Defense Comments To The Recommendation:
RECOMMENDATION: The GAO recommended that the Secretary of Defense delay
further investments in F-22A procurement and modernization until it
completes a comprehensive business case analysis that adequately
considers alternatives, justifies the need for further investments, and
reconciles the numbers of F-22As that are needed (i.e., based on
credible current and future threats and considering other alternative
approaches) as well as affordable and sustainable (i.e. based on
current and expected DOD resource levels) (p. 7 GAO Draft Report).
DOD RESPONSE: Nonconcur with the GAO recommendation.
* The F-22 is currently in full rate production. A delay in F-22
procurement would result in production shut down and impact the entire
F-22 supplier base consisting of thousands of companies. Once
interrupted, it would be very costly, and time consuming to resurrect.
The F-22 industrial base involves many of the same companies that will
manufacture components for the Joint Strike Fighter when it enters
production. Disruption of F-22 production could cause many of those
suppliers to move to other business activities, seriously weakening the
nation's tactical aircraft industrial base.
* The assumption on which this recommendation was made is not accurate.
The quantity and mix of tactical aircraft to be procured by the
department has been and remains the subject of continuous analysis.
Most recently, in support of the Quadrennial Defense Review, the
Department examined a number of options for varying levels within the
strike fighter mix. The results of this Joint Air Dominance (JAD) study
are reflected in the President's Fiscal Year 2007 Budget which sets
forth a balanced portfolio of tactical aircraft assets, including Joint
Strike Fighter, F-22 and F/A-18E/F Super Hornet aircraft that have
already proven their worth in the Global War On Terrorism. We looked at
the war fight and cost implications of buying fewer variants of Joint
Strike Fighters, increasing and decreasing the number of F-22s, and
buying more legacy aircraft at the expense of fewer fifth generation
platforms. Our analysis showed that buying fifth generation tactical
aircraft (F-22 and JSF), for both the Air Force and the Department of
the Navy, optimized capabilities and mitigated risk better than other
options.
* In the JAD studies supporting the Quadrennial Defense Review, the F-
22 clearly demonstrated its superiority as an air dominance fighter
with the JSF also showing strong capabilities. These fifth generation
fighters are needed in the early days of a conflict to gain air
dominance by neutralizing advanced air and surface threats, and thereby
"opening the door" for follow-on joint forces, including non-stealthy
legacy tactical aviation and long-range strike aircraft. The quantity
of 183 F-22s, reflected in the P1307, incorporates the ability to
reposition some of the F-22 aircraft to other theaters, or to the
homeland, after suppression of the major threats to air dominance in
the early days of a conflict. Changing the mix of F-22 and JSF aircraft
only marginally increased effectiveness. When fielded, the tri-service
Joint Strike Fighters, with their superior strike capability, will
complement F-22 capabilities and can remain in theater with legacy
aircraft to conduct strike missions and suppress any remaining air
dominance threats. The logistics plans used in the analysis reflected
the Combatant Commander's war plans.
* The analysis used the projected enemy's order of battle provided by
the Central Intelligence Agency/Defense Intelligence Agency-approved
Joint Capability Force Assessment for the 2024 timeframe. The selected
scenario for the modeling was the most challenging to air dominance in
terms of enemy capability and quantity, and it was in accordance with
the Joint Staff Multi-Service Force Deployment. The results showed that
a balanced force structure mix of fifth generation fighters with legacy
F/A-18E/Fs, F-15Es, and conventionally armed bombers met our
requirements and balanced cost and risk.
* Modernization and continuous improvement are characteristics of many
defense programs and are essential to maintaining the military
advantage of our forces in an environment of rapid proliferation of
advanced technologies. The Department's decision to hold F-22
procurement at 183 aircraft, increases the importance of the
modernization program. With fewer aircraft than originally envisioned,
the F-22 must bring a high level of capability with continuous
improvement, to maintain the U.S. advantage in air dominance.
(120558):
[End of Section]
FOOTNOTES
[1] Air superiority is the degree of air dominance that allows the
conduct of operations by land, sea, and air forces without prohibitive
interference by the enemy.
[2] GAO, Tactical Aircraft: Air Force Still Needs Business Case to
Support F/A-22 Quantities and Increased Capabilities, GAO-05-304
(Washington, D.C.: Mar. 15, 2005).
[3] A business case provides demonstrated evidence that (1) the
warfighter need exists and that it can best be met with the chosen
concept and (2) the concept can be developed and produced within
existing resources--technologies, design, funding, and time.
Establishing a business case calls for a realistic assessment of risks
and costs; doing otherwise undermines the intent of the business case
and invites failure.
[4] Global Strike is one of six complementary concepts of operations
laying out the Air Force's ability to rapidly plan and deliver limited-
duration and extended attacks against targets.
[5] F-22A and F-35 are considered 5TH generation fighter aircraft as
compared to the F-15, F-16, F/A-18 and F-117. The primary
characteristics are Very Low Observable (VLO) stealth and information
fusion capabilities that make 5TH generation aircraft more survivable
and lethal.
[6] The Air Force needs statutory authorization for its proposed
multiyear contract under 10 U.S.C. § 2306b and the annual DOD
appropriations act.
[7] Section 8008 of the fiscal years 2005 and 2006 Department of
Defense Appropriations Acts (Public Laws 108-287 and 109-148,
respectively) require full funding of units to be procured.
[8] 10 U.S.C. § 2306b (i)(4)(A). This restriction was added by section
820 of the Bob Stump National Defense Authorization Act for Fiscal Year
2003 (Public Law 107-314).
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