Defense Acquisitions
Future Ground-Based Vehicles and Network Initiatives Face Development and Funding Challenges Gao ID: GAO-12-181T October 26, 2011After the Army canceled the Future Combat System in June of 2009, it began developing modernization plans, including developing a new Ground Combat Vehicle (GCV) and additional network capability. At the same time, the Army was considering options on how to improve its light tactical vehicles. This statement addresses potential issues related to developing (1) the new GCV, (2) a common information network, and (3) the Joint Light Tactical Vehicle (JLTV) in a constrained budget environment. The statement is based largely on previous GAO work conducted over the last year in response to congressional requests and results of other reviews of Army modernization. To conduct this work, GAO analyzed program documentation, strategies, and test results; interviewed independent experts and Army and Department of Defense (DOD) officials; and witnessed demonstrations of current and emerging network technologies. DOD reviewed the facts contained in this statement and provided technical comments, which were incorporated as appropriate.
Delivering a feasible, cost-effective, and executable GCV solution presents a major challenge to the Army, with key questions about the robustness of the analysis of alternatives, the plausibility of its 7-year schedule, and cost and affordability. DOD and the Army have taken steps to increase oversight of the program, but resolving these issues during technology development will remain a challenge. For example, the Army has already reduced some requirements and encouraged contractors to use mature technologies in their proposals, but the 7-year schedule remains ambitious, and delays would increase development costs. Independent cost estimates have suggested that 9 to 10 years is a more realistic schedule. Over the next 2 years during the technology development phase, the Army faces major challenges in deciding which capabilities to pursue and include in a GCV vehicle design and determine whether the best option is a new vehicle or modifications to a current vehicle. The Army's new information network strategy moves away from a single network development program to an incremental approach with which feasible technologies can be developed, tested, and fielded. The new strategy has noteworthy aspects, such as using periodic field evaluations to assess systems that may provide potential benefit and getting soldier feedback on the equipment being tested. However, the Army has not articulated requirements, incremental objectives, or cost and schedule projections for its new network. It is important that the Army proceed in defining requirements and expected capabilities for the network to avoid the risk of developing individual capabilities that may not work together as a network. With the cancellation last week of its ground mobile radio and continuing problems in developing technology to provide advanced networking capability, the Army will still need to find foundational pieces for its network. The Army is reworking earlier plans to develop and acquire the JLTV and is planning to recapitalize some of its High Mobility, Multipurpose Wheeled Vehicles (HMWWV). These efforts have just begun, however, and their results are not yet assured. To reduce risk in the JLTV program, the services relied on multiple vendors during technology development to increase their knowledge of the needed technologies, determine the technology maturity level, and determine which requirements were achievable. As a result, the services identified trades in requirements to drive down the cost of the vehicle. For example, the services found that JLTV could not achieve both protection level and transportability goals, so the services are accepting a heavier vehicle. A potential risk for the services in allowing industry to build vehicles for testing is that the prototypes may not be mature; the Army will need to keep its options open to changes that may result from these tests. Both the Army and the Marine Corps have articulated a significant future role for their Up-Armored HMMWV fleets, yet the fleets are experiencing reduced automotive performance, the need for better protection as threats have evolved, and other issues. The Army is planning to recapitalize a portion of its Up-Armored HMMWV fleet to increase automotive performance and improve blast protection. The Marine Corps' plans to extend the service life of some of its HMMWVs used in light tactical missions are not yet known. GAO is not making any recommendations with this statement; however, consistent with previous work, this statement underscores the importance of developing sound requirements and focusing up front on what modernization efforts will deliver and at what cost.
GAO-12-181T, Defense Acquisitions: Future Ground-Based Vehicles and Network Initiatives Face Development and Funding Challenges
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United States Government Accountability Office:
GAO:
Testimony:
Before the Subcommittee on Tactical Air and Land Forces, Committee on
Armed Services, House of Representatives:
For Release on Delivery:
Expected at 2:00 p.m. EDT:
Wednesday, October 26, 2011:
Defense Acquisitions:
Future Ground-Based Vehicles and Network Initiatives Face Development
and Funding Challenges:
Statement of Belva M. Martin, Director Acquisition and Sourcing
Management:
GAO-12-181T:
GAO Highlights:
Highlights of [hyperlink, http://www.gao.gov/products/GAO-12-181T], a
testimony before the Subcommittee on Tactical Air and Land Forces,
Committee on Armed Services, House of Representatives.
Why GAO Did This Study:
After the Army canceled the Future Combat System in June of 2009, it
began developing modernization plans, including developing a new Ground
Combat Vehicle (GCV) and additional network capability. At the same
time, the Army was considering options on how to improve its light
tactical vehicles.
This statement addresses potential issues related to developing (1) the
new GCV, (2) a common information network, and (3) the Joint Light
Tactical Vehicle (JLTV) in a constrained budget environment. The
statement is based largely on previous GAO work conducted over the last
year in response to congressional requests and results of other reviews
of Army modernization.
To conduct this work, GAO analyzed program documentation, strategies,
and test results; interviewed independent experts and Army and
Department of Defense (DOD) officials; and witnessed demonstrations of
current and emerging network technologies. DOD reviewed the facts
contained in this statement and provided technical comments, which were
incorporated as appropriate.
What GAO Found:
Delivering a feasible, cost-effective, and executable GCV solution
presents a major challenge to the Army, with key questions about the
robustness of the analysis of alternatives, the plausibility of its 7-
year schedule, and cost and affordability. DOD and the Army have taken
steps to increase oversight of the program, but resolving these issues
during technology development will remain a challenge. For example, the
Army has already reduced some requirements and encouraged contractors
to use mature technologies in their proposals, but the 7-year schedule
remains ambitious, and delays would increase development costs.
Independent cost estimates have suggested that 9 to 10 years is a more
realistic schedule. Over the next 2 years during the technology
development phase, the Army faces major challenges in deciding which
capabilities to pursue and include in a GCV vehicle design and
determine whether the best option is a new vehicle or modifications to
a current vehicle.
The Army‘s new information network strategy moves away from a single
network development program to an incremental approach with which
feasible technologies can be developed, tested, and fielded. The new
strategy has noteworthy aspects, such as using periodic field
evaluations to assess systems that may provide potential benefit and
getting soldier feedback on the equipment being tested. However, the
Army has not articulated requirements, incremental objectives, or cost
and schedule projections for its new network. It is important that the
Army proceed in defining requirements and expected capabilities for the
network to avoid the risk of developing individual capabilities that
may not work together as a network. With the cancellation last week of
its ground mobile radio and continuing problems in developing
technology to provide advanced networking capability, the Army will
still need to find foundational pieces for its network.
The Army is reworking earlier plans to develop and acquire the JLTV and
is planning to recapitalize some of its High Mobility, Multipurpose
Wheeled Vehicles (HMWWV). These efforts have just begun, however, and
their results are not yet assured. To reduce risk in the JLTV program,
the services relied on multiple vendors during technology development
to increase their knowledge of the needed technologies, determine the
technology maturity level, and determine which requirements were
achievable. As a result, the services identified trades in requirements
to drive down the cost of the vehicle. For example, the services found
that JLTV could not achieve both protection level and transportability
goals, so the services are accepting a heavier vehicle. A potential
risk for the services in allowing industry to build vehicles for
testing is that the prototypes may not be mature; the Army will need to
keep its options open to changes that may result from these tests. Both
the Army and the Marine Corps have articulated a significant future
role for their Up-Armored HMMWV fleets, yet the fleets are experiencing
reduced automotive performance, the need for better protection as
threats have evolved, and other issues. The Army is planning to
recapitalize a portion of its Up-Armored HMMWV fleet to increase
automotive performance and improve blast protection. The Marine Corps‘
plans to extend the service life of some of its HMMWVs used in light
tactical missions are not yet known.
What GAO Recommends:
GAO is not making any recommendations with this statement; however,
consistent with previous work, this statement underscores the
importance of developing sound requirements and focusing up front on
what modernization efforts will deliver and at what cost.
View [http://www.gao.gov/products/GAO-12-181T]. For more information,
contact Belva Martin at (202) 512-4841 or martinb@gao.gov.
[End of section]
Chairman Bartlett, Ranking Member Reyes, and Members of the
Subcommittee:
I am pleased to be here today to discuss the Department of the Army's
recent initiatives to acquire ground-based combat and tactical vehicles
and an information network capability. In the wake of the June 2009
decision to cancel the Future Combat System, which included a new class
of manned ground vehicles anchored by an advanced information network,
the Army began developing plans for a new Ground Combat Vehicle (GCV)
and an incremental tactical network capability. At about the same time,
the Army began considering ways to improve its light tactical vehicles
and developed the Joint Light Tactical Vehicle (JLTV) program with the
U.S. Marine Corps. My statement today, based largely on work we have
conducted over the last year in response to requests from this
subcommittee and results of other reviews of Army modernization, will
address potential issues that the Army faces as it prepares to make
significant decisions on its GCV, network, and light tactical vehicle
programs in this constrained budget environment.
To assess the GCV program, we analyzed program documentation, such as
the Initial Capabilities Document and the Technology Development
Strategy; interviewed Army and Department of Defense (DOD) officials;
and interviewed independent experts and reviewed their analyses. We
analyzed the Army networking and management strategy, and compared that
strategy with DOD acquisition policy and best practices. We also
observed demonstrations of current and emerging networking equipment,
analyzed evaluation results, obtained soldier feedback, and met with
Army and DOD officials who are involved in defining the tactical
network. To assess JLTV, we analyzed documentation, interviewed Army
and Marine Corps officials, and analyzed how the Mine Resistant Ambush
Protected (MRAP) vehicle program, including the MRAP-All Terrain
Vehicle (M-ATV), has influenced the JLTV program. We also obtained and
reviewed JLTV test results and interviewed test officials. To assess
the High Mobility, Multipurpose Wheeled Vehicle (HMMWV)
recapitalization plan, we analyzed both services' respective plans for
future recapitalization efforts, reviewed past efforts, and interviewed
Army and Marine Corps officials.
We conducted work on these Army programs as part of performance audits
from December 2010 to October 2011, in accordance with generally
accepted government auditing standards. Those standards require that we
plan and perform the audit to obtain sufficient, appropriate evidence
to provide a reasonable basis for our findings and conclusions based on
our audit objectives. We believe that the evidence obtained provides a
reasonable basis for our findings and conclusions based on our audit
objectives.
Background:
The Army's ground-based military operations generally use two kinds of
vehicles: combat vehicles designed for a specific fighting function and
tactical vehicles designed primarily for multipurpose support
functions. Most combat vehicles move on tracks--including the Abrams
tank and the Bradley Fighting Vehicle--but some move on wheels, such as
the Stryker. Tactical vehicles generally move on wheels, including the
HMMWV and the JLTV.
Most major defense acquisitions follow a structured acquisition
process, which normally consists of three discrete phases: (1)
technology development; (2) engineering and manufacturing development;
and (3) production and deployment. Programs are expected to meet
certain criteria at milestone decision points for entry into each
phase.[Footnote 1] For anticipated major defense acquisition
programs,[Footnote 2] like the GCV and the JLTV, the Under Secretary of
Defense for Acquisition, Technology, and Logistics (USD/ATL) generally
serves as the Milestone Decision Authority. The Milestone Decision
Authority is responsible for approving the programs' entry into the
defense acquisition system, approving entry into subsequent phases, and
documenting the various approvals through acquisition decision
memorandums.
The Army's GCV program is intended to modernize the current ground
combat vehicle fleet, replacing a portion of the Bradley Infantry
Fighting Vehicles currently in inventory. In February 2010, the Army
issued a request for proposals for the technology development phase of
the GCV before completing the required analysis of alternatives (AOA),
citing schedule urgency. In May 2010, the Army convened a "Red Team" to
assess the risk of achieving the GCV schedule. The Red Team issued its
report in August 2010, citing major risk areas including schedule,
technical maturity, and affordability of the system. The Army rescinded
the original request for proposals and issued another in late 2010. The
milestone A decision was expected in April 2011, but did not occur
until August 2011 (see fig. 1). In August, the Army awarded technology
development contracts to two contractor teams. A third contractor team
submitted a proposal but did not receive a contract award and has filed
a bid protest with GAO that is still being considered.
Figure 1: GCV Program Events:
[Refer to PDF for image: timeline]
CY 2010-CY 2018:
DOD acquisition process:
Materiel Solution Analysis (Materiel development February 2010);
Technology Development (Current GCV status);
Engineering and Manufacturing development: Integrated System design
(Preliminary design review);
Engineering and Manufacturing development: System capability and
manufacturing process demonstration (Critical design review);
Production (1st production vehicle, late-2018).
Acquisition milestones (GCV estimates):
CY 2011;
A: (August 2011).
CY 2013;
B: Development start: (August 2013).
CY 2017;
C: Production start: (Summer 2017).
Source: GAO analysis of Army data and the DOD acquisition process.
[End of figure]
The Army has been defining a strategy to develop, demonstrate, and
field a common tactical information network across its forces.
Generally, such a network is expected to act as an information
superhighway to collect, process, and deliver vast amounts of
information such as images and communications while seamlessly linking
people and systems. The Army's current strategy is to better understand
current Army networking capabilities, determine capabilities needed,
and chart an incremental path forward. The Army plans regular
demonstrations as the network grows and its capability improves.
The Army and Marine Corps generally define light tactical vehicles as
capable of being transported by a rotary wing aircraft and with a cargo
capacity of equal to or less than 5,100 pounds. Light tactical vehicles
represent about 50 percent of the Army's tactical wheeled vehicle fleet
and currently consist of the HMMWV family of vehicles. The Army's HMMWV
program also provides vehicles to satisfy Marine Corps, Air Force, and
other requirements. The JLTV is expected to be the next generation of
light tactical vehicles and is being designed to provide the advances
in protection, performance, and payload to fill the capability gap
remaining between the HMMWV and MRAP family of vehicles.[Footnote 3]
JLTV is being designed to protect its occupants from the effects of
mines and improvised explosive devices without sacrificing its payload
capability or its automotive performance, which has not been the case
with the other tactical wheeled vehicles.
The Army's recent history with its acquisition programs was the subject
of a review by a panel chartered by the Secretary of the Army. In its
January 2011 report,[Footnote 4] the panel noted that the Army has
increasingly failed to take new development programs into full-rate
production. From 1990 to 2010, the Army terminated 22 major defense
acquisition programs before completion. While noting many different
causes that contribute to a program's terminations, the panel found
that many terminated programs shared several of the same problems,
including weak trade studies or analyses of alternatives; unconstrained
weapon system requirements; underestimation of risk, particularly
technology readiness levels; affordability reprioritization; schedule
delays; and requirements and technology creep. The panel made a number
of recommendations to help make the Army's requirements, resourcing,
and acquisition processes more effective and efficient.
Army Faces Major Challenges to Identify a Feasible, Cost-Effective, and
Executable GCV Solution:
Over the next 2 years during the technology development phase, the Army
faces major challenges to identify a feasible, cost-effective, and
executable solution that meets the Army's needs. Among these are making
choices on which capabilities to pursue and include in a GCV vehicle
design and determining whether the best option is a new vehicle or a
modified current vehicle. In our March 2011 testimony,[Footnote 5] we
identified key questions about GCV pertaining to how urgently it is
needed, robustness of the analysis of alternatives, plausibility of its
7-year schedule, cost and affordability, and whether mature
technologies would be used. Since that time, the Army has moved the CGV
program into the technology development phase. DOD and the Army have
taken positive steps to increase their oversight of the program;
however, the timely resolution of issues surrounding the areas
previously identified will be a major challenge.
* Urgency of need: The Army's recent combat vehicle capability
portfolio review confirmed the Army's need for GCV as a Bradley
Infantry Fighting Vehicle replacement and USD/ATL approved the GCV
acquisition program.[Footnote 6] USD/ATL agreed that the Army has a
priority need for a GCV but the number of caveats in the approval
decision (as discussed below) raises questions about the soundness of
the Army's acquisition plans and time lines.
* Analysis of alternatives: After initially bypassing completion of the
AOA process, the Army subsequently conducted an AOA but was directed by
USD/ATL to conduct more robust analyses, throughout the technology
development phase, to include design and capability trades intended to
reduce technical risks and GCV production costs. We have reported that
a robust AOA can be a key element in ensuring a program has a sound,
executable business case prior to program initiation and that programs
that conduct a limited AOA tended to experience poorer outcomes--
including cost growth.[Footnote 7] The Army is expected to include
sensitivity analyses in the AOA to explore trade-offs between specific
capabilities and costs. These analyses will be supported by assessments
of existing combat vehicles to determine whether they are adequate
alternatives to a new vehicle, or whether some of the designs or
capabilities of existing vehicles should be incorporated into a new
GCV. Concurrently, the GCV contractor teams will conduct design trades
and demonstrate technologies, the results of which will also be fed
back into the AOA updates.
* Plausibility of 7-year schedule: The Army's plan to deliver the first
production vehicles in 7 years still has significant risk. Since GCV
was originally conceived in 2009, the Army has already reduced some
requirements and encouraged interested contractors to use mature
technologies in their proposals. However, the schedule remains
ambitious and USD/ATL has stipulated that the Army will need to
demonstrate that the schedule is both feasible and executable.
According to an independent Army program evaluator, the next 2 years of
technology development will require many capability and requirements
trades in order to better define an acceptable solution at the same
time that technology risks for that solution are to be identified and
mitigated. Concurrent activities can lead to poor results, calling into
question whether the 7-year schedule is executable. The independent
cost estimate submitted for the milestone A review featured higher GCV
development costs with the assumption that the Army would need 9 or 10
years to complete the program, instead of the assumed 7 years.
* Cost and affordability: Cost continues to be a challenge, as an
independent cost estimate was at least 30 percent higher than the
Army's estimate for GCV procurement. USD/ATL has directed that
continued program approval depends on the Army's ability to meet the
$13 million procurement unit cost target. As for affordability, with
the expectation that less funding will be available in coming years,
the Army has made some trades within the combat vehicle portfolio.
According to Army officials, the Army plans to proceed with GCV as
currently planned, but several other combat vehicle programs--such as
anticipated upgrades for the Bradley, Abrams, and Stryker vehicles--are
being reshaped or delayed.
* Use of mature technologies: The Army encouraged interested contractor
teams to use mature technologies in their GCV proposals. Due to the
current bid protest, we do not have insight into what the contractor
teams proposed in terms of specific critical technologies or their
maturity. A DOD official stated, and we agree, that it will be
important that technologies be thoroughly evaluated at the preliminary
design review before the decision to proceed to the engineering and
manufacturing development phase.
Ambitious Army Information Network Strategy Has Noteworthy Aspects but
Unresolved Issues Could Affect Long-Term Implementation:
The Army has taken a number of steps to put together a more realistic
strategy to develop and field an information network for its deployed
forces than the network envisioned for the Future Combat System
program. However, the Army is proceeding without defining requirements
for the network and articulating clearly defined capabilities. As a
result, the Army runs the risk of developing a number of stovepipe
capabilities that may not work together as a network, thus wasting
resources. The Army has moved away from its plan for a single network
development program under Future Combat System to an incremental
approach with which feasible technologies can be developed, tested, and
fielded. This planned approach reflects lessons learned and changes the
way the Army develops, acquires, and fields network capabilities. Under
this new approach, numerous programs will be developed separately and
coordinated centrally, and network increments will be integrated and
demonstrated in advance of fielding rather than the previous practice
of ad hoc development and integration in the field. A key aspect of the
implementation of the new approach will be aligning the schedules of
the separate programs with the Army's planned, semiannual field events,
called network integration evaluations, where emerging technologies are
put in soldiers' hands for demonstration and evaluation.
Several key aspects of the Army's Network Strategy include:
* In our March 2011 testimony,[Footnote 8] we pointed out that roles
and responsibilities for network development were not clear. Since
then, senior Army leadership issued a directive detailing the
collective roles, responsibilities, and functions of relevant Army
organizations involved with the network modernization effort.
* The Army is currently working to establish a comprehensive integrated
technical baseline for the network and addressing prioritized
capability gaps. With this baseline, the Army expects to build on
elements of the network already in place with an emphasis on capturing
emerging technologies that deliver capability incrementally to multiple
units at the same time. This represents a significant departure from
the previous practice of fielding systems individually and often to
only one element of the operational force at a time (for instance,
companies, battalions, or brigades).
* The network integration evaluations are a key enabler of the Army's
new network strategy and assess systems that may provide potential
benefits and value to the Army while identifying areas requiring
additional development. The evaluation process provides the Army an
opportunity to improve its knowledge of current and potential network
capability. Additionally, it provides soldier feedback on the equipment
being tested. For example, members of the Army's network test unit, the
Brigade Modernization Command, indicated that a number of systems
tested should be fielded and other systems that should continue
development.
Several issues will need to be resolved as the Army implements its
network strategy. For example,
* The Army has not yet announced requirements nor has it established
cost and schedule projections for development and fielding of its
network. Since the Future Combat System termination, the Army does not
have a blueprint or framework to determine how the various capabilities
it already has will fit together with capabilities it is acquiring to
meet the needs of the soldier. Even with an incremental approach, it is
important for the Army to clearly articulate the capabilities the
system is attempting to deliver. Without this knowledge, the Army runs
the risk of acquiring technologies that may work in a stand-alone mode
but do not add utility to the broader network strategy.
* The network integration evaluation provided an extensive amount of
data and knowledge on the current Army network and candidate systems
for the network. However, since the network integration evaluation
serves as an evaluation instrument, it is important to have test
protocols that capture objective measures and data on the network's
performance. Two independent Army test oversight agencies, reflecting
on the evaluation results, expressed concern over not having proper
instrumentation for the overall evaluations; in particular, not having
the necessary instrumentation to conduct operational tests on large
integrated networks and not having clear network requirements.
* Army officials are developing a strategy to identify, demonstrate,
and field emerging technologies in an expedited fashion. To date, the
Army has developed an approach to solicit ideas from industry and
demonstrate the proposed technologies in the network integration
evaluation. However, the Army is still formulating its proposed
approach for funding and rapidly procuring the more promising
technologies.
* Development of the Joint Tactical Radio System ground mobile radio, a
software-defined radio that was expected to be a key component of the
network has recently been terminated. In a letter to a congressional
defense committee explaining the termination, the acting USD/ATL stated
that the termination was based on growth in unit procurement costs. He
added that it is unlikely that Joint Tactical Radio System ground
mobile radio would affordably meet requirements and may not meet some
requirements at all. The radio performed poorly during the network
integration evaluation and was given a "stop development and do not
field" assessment by the test unit. Based on the assessment that a
competitive market had emerged with the potential to deliver alternate
radios to meet the capability at a reduced cost, the acting USD/ATL
also established a new program for an affordable; low-cost; reduced
size, weight, and power radio product. At this point, it is not yet
clear when and how that program will proceed or how these new radios
will be able to fit within the Army's network strategy.
* The Army plans for the future tactical network to feature the use of
the wideband networking and soldier radio waveforms and, in our March
2011 testimony,[Footnote 9] we reported that the Army has had trouble
maturing these waveforms for several years and they are still not at
acceptable levels of maturity.[Footnote 10] Although both waveforms
experienced limited successes during the recent network integration
evaluation testing, Army officials indicate that the wideband
networking waveform continues to be very complex, and not fully
understood, and there may be substantial risk maturing it to its full
capability requirement. With the termination of the ground mobile
radio, it is unclear how waveform maturation will continue.
* Although the network integration kit--expected to be a fundamental
part of the Army's information network--was found to have marginal
performance, poor reliability, and limited utility, the USD/ATL
approved procurement of one additional brigade set of network
integration kits. The decision made potential fielding of the kits--
radios, waveforms, integrated computer system, and software--contingent
on user testing that successfully demonstrates that it can improve
current force capabilities. The network integration kit again performed
poorly during the recent network integration evaluation and received a
"stop development and do not field" assessment. Army network officials
have indicated that a senior Army leadership memorandum will be
forthcoming that will cancel further network integration kit
development and fielding. Earlier, the Army concluded that the network
integration kit was not a long-term, viable, and affordable solution.
Services to Rely on Industry to Provide Potential Solutions for
Tactical Wheeled Vehicle Needs:
To reduce risk in the JLTV program, the Army and Marine Corps entered a
technology development phase with multiple vendors to help increase
their knowledge of the needed technologies, determine the technologies'
maturity level, and determine which combination of requirements were
achievable. The contractors delivered prototype vehicles in May 2010
and testing to evaluate the technical risks in meeting the proposed
requirements, among other things, was completed on the vehicles in June
2011. Because of the knowledge gained through the technology
development phase, the services have worked together to identify trades
in requirements to reduce weight and to drive down the cost of the
vehicle. A different outcome may have resulted if the services had
proceeded directly to the engineering and manufacturing development
phase, as had been considered earlier.
Based on the technology development results, the services concluded
that the original JLTV requirements were not achievable and its cost
would be too high. For example, the services found that JLTV could not
achieve both protection levels and transportability, with weight being
the issue. As a result, the services have adjusted the JLTV
transportability requirement to a more achievable level and the Army
and Marine Corps have decided that they would rely on HMWWVs for other
missions initially intended for JLTV. In fact, the Army has chosen to
proceed with even higher protection levels than planned earlier for
JLTV. The Army now plans to have protection levels equal to the M-ATV,
including underbody protection, while the Marine Corps will continue
with the original protection level, similar to the MRAP family of
vehicles except for the underbody protection, but plans to conduct more
off-road operations to avoid mines and roadside bombs. As for armor
protection, the services have found that development of lightweight,
yet robust armor has not proceeded as rapidly as hoped and production
costs for these new technologies are significantly higher than for
traditional armor.
The services have established an average procurement cost target of
$350,000.[Footnote 11] A key component of the average procurement cost
is the average manufacturing unit cost which includes the cost of
labor, materials, and overhead to produce and assemble the product.
Achieving the average procurement cost target of $350,000 would require
an average manufacturing unit cost of $250,000 to $275,000. While one
recent technology development projection of a fully armored JLTV
average procurement cost exceeded $600,000, the program office now
estimates that, by implementing requirements trades and the cost
savings from those trades, industry can meet the average manufacturing
unit cost and average procurement cost targets. Nevertheless, meeting
the JLTV cost targets will be a challenge and will also likely depend
on what type of contract the services award. The services' current JTLV
plan is to award a multiyear procurement contract with sizable annual
quantities, once a stable design is achieved.
Originally, the services planned to follow a traditional acquisition
approach for JLTV and enter the engineering and manufacturing
development phase in January 2012. According to the Army program
manager for light tactical vehicles, the services now plan to use a
modified MRAP acquisition model in which industry would be asked to
build a set of vehicles that would subsequently be extensively tested
prior to a production decision. The Army has stated that industry had
demonstrated several competitive prototypes whose performance and cost
has been verified and believes that industry can respond with testable
prototypes within about 1 year. Many details of the new strategy have
yet to be worked out but a milestone B review is anticipated in April
2012. While this approach is seen as saving time and money, it will
forgo the detailed design maturation and development testing process
typically done early in the engineering and manufacturing development
phase. A key risk is the potential for discovering late that the
vehicles are still not mature.
HMWWV Recapitalization Effort:
Both the Army and the Marine Corps have articulated a significant role
for the Up-Armored HMMWV in combat, combat support, and combat service
support roles beyond fiscal year 2025 but their fleets are experiencing
reduced automotive performance, loss of transportability, higher
operation and sustainment costs, and the need for better protection as
the threats have evolved. The Army plans to recapitalize a portion of
its Up-Armored HMMWV fleets by establishing requirements, seeking
solutions from industry through full and open competition, and testing
multiple prototype vehicles before awarding a single production
contract. The Army's emerging effort--the Modernized Expanded Capacity
Vehicle program--aims to modernize vehicles to increase automotive
performance, regain mobility, extend service life by 15 years, and
improve blast protection. The initial increment of recapitalized
vehicles for the Army is expected to be about 5,700, but depending on
the availability of funds, the quantity for the Army could increase.
The Army plans a two-phased acquisition strategy for recapitalizing the
Up-Armored HMMWV that includes awarding contracts to up to three
vendors for prototype vehicles for testing and a production contract to
a single vendor. The production decision is scheduled for late fiscal
year 2013. The Army is anticipating a manufacturing cost of $180,000
per vehicle, not including armor, based on the cost performance of
similar work on other tactical platforms managed by the Army.
According to the Marine Corps developers, the Marine Corps has
concluded a recapitalized HMMWV will not meet requirements for is fleet
of 5,000 light combat vehicles. However, it will conduct research to
find the most effective way to sustain the balance of the fleet--about
14,000 vehicles--until 2030. The Marine Corps plans to leverage
components and subsystems from the Army-sponsored HMMWV
recapitalization program. Detailed information on this effort is not
currently available. Marine Corps and Army officials have said they
intend to cooperate on the recapitalization effort and are sharing
information on their individual plans to help maximize value for the
available funding.
As the services proceed to implement their new JLTV and HMMWV
strategies, they have identified a point in fiscal year 2015 (see fig.
2) where a decision will be made on whether to pursue JLTV only or both
programs. By then, the technology and cost risks of both efforts should
be better understood.
Figure 2: JLTV and HMMWV Competitive Recapitalization Schedules:
[Refer to PDF for image: timeline]
Proposed JLTV:
FY 2012;
Request for Proposals.
FY 2012-2013;
Milestone B.
Within FY 2013-2015;
Gov't performance test report.
Within FY 2015-2018;
Initial production.
Within FY 2015-2016;
Milestone C.
FY 2015;
Decide JLTV only or both programs.
HMMWV Competitive Recapitalization:
Within FY 2012-FY 2013;
Pre-milestone C evaluation.
Within 2013;
Milestone C (Yes/No HMMWV competitive recapitalization decision).
End of FY 2013;
Initial production.
FY 2016;
Full rate production decision.
Source: GAO analysis of program office information.
[End of figure]
Concluding Remarks:
The Army continues to struggle to define and implement a variety of
modernization initiatives since the Future Combat System program was
terminated in 2009. The most recent example of this is the termination
of the ground mobile radio, which will require the Army to develop new
plans for relaying information to the soldier. The pending reductions
in the defense budgets are having a significant impact on Army
acquisition programs and the Army is already reprioritizing its combat
vehicle investments. As plans for GCV move forward, it will be
important for DOD, the Army, and the Congress to focus attention on
what GCV will deliver and at what cost and how that compares to other
needs within the combat vehicle portfolio. Beyond combat vehicles, DOD
and the services will also be facing some tough decisions in the future
on the tactical wheeled vehicle programs and the affordability of both
the JLTV and the HMWWV recapitalization effort.
Over the last few years, the Army has been conducting capability
portfolio reviews which have proven to be very helpful in identifying
overlaps and setting priorities. The reviews were highlighted in the
Army Acquisition Review and have been important in getting the Army to
think more broadly and to look beyond the individual program. On both
JLTV and GCV, as the requirements have been examined more closely, the
services are finding that they can make do with less in terms of
capabilities than originally anticipated and projected unit costs have
been reduced significantly. It is important that the Army continue to
use and improve on its capability portfolio review processes going
forward and to consider a broad range of alternatives.
Chairman Bartlett, Ranking Member Reyes, and Members of the
Subcommittee, this concludes my prepared statement. I would be happy to
answer any questions you may have at this time.
GAO Contact and Staff Acknowledgments:
For future questions about this statement, please contact me at (202)
512-4841 or martinb@gao.gov. Contact points for our Offices of
Congressional Relations and Public Affairs may be found on the last
page of this statement. Individuals making key contributions to this
statement include William R. Graveline, Assistant Director; William C.
Allbritton; Morgan DelaneyRamaker; Marcus C. Ferguson; Dayna Foster;
Danny Owens; Sylvia Schatz; Robert S. Swierczek; Alyssa B. Weir; and
Paul Williams.
[End of section]
Footnotes:
[1] Milestone A is the point at which a program enters the technology
development phase, milestone B is entry into the engineering and
manufacturing development phase, and milestone C is entry into the
production and deployment phase.
[2] Major defense acquisition programs are those identified by DOD that
require eventual total research, development, test, and evaluation
expenditures, including all planned increments, of more than $365
million, or procurement expenditures, including all planned increments,
of more than $2.19 billion, in fiscal year 2000 constant dollars.
[3] The HMMWV has served as DOD's primary wheeled vehicle for shelter
carriers, command and control systems, light cargo and troop carriers,
weapons carriers, and ambulances for over 25 years. MRAPs were acquired
to support operations in Iraq and Afghanistan and are designed to
better mitigate the effects of improvised explosive devices, underbody
mines, and small arms fire threats.
[4] Office of the Secretary of the Army, Army Strong: Equipped, Trained
and Ready, Final Report of the 2010 Army Acquisition Review
(Washington, D.C.: Jan. 2011).
[5] GAO, Defense Acquisitions: Key Questions Confront the Army's Ground
Force Modernization Initiatives, [hyperlink,
http://www.gao.gov/products/GAO-11-425T] (Washington, D.C.: March 9,
2011).
[6] Capability portfolio reviews are the Army's process for identifying
and eliminating redundant systems, and ensuring that funds are properly
programmed, budgeted, and executed for surviving systems in order to
yield the most value to the Army.
[7] GAO, Defense Acquisitions: Many Analyses of Alternatives Have Not
Provided a Robust Assessment of Weapon System Options, [hyperlink,
http://www.gao.gov/products/GAO-09-665] (Washington, D.C.: Sept. 24,
2009).
[8] [hyperlink, http://www.gao.gov/products/GAO-11-425T].
[9] [hyperlink, http://www.gao.gov/products/GAO-11-425T].
[10] A waveform is the representation of a signal that includes the
frequency, modulation type, message format, and/or transmission system.
The wideband networking and soldier radio waveforms provide key
advanced networking capability.
[11] The average procurement unit cost includes the average for such
items as the costs of procuring technical data, training, support
equipment, and initial spares. In addition, the cost of armor options
would be an additional $60,000 per unit.
[End of section]
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