Financial Status of Major Acquisitions, June 30, 1975

The Department of Defense (DOD) defines major acquisitions as those with an estimated research, development, test, and evaluation cost in excess of $50 million or an estimated production cost in excess of $200 million. A uniform threshold of $25 million was used to define major acquisitions of civilian agencies. Data is furnished on acquisitions which are past the planning stage and into development, testing, production, or construction phases. Completed projects are not included. Weapons system cost data was extracted from selected acquisition reports prepared by DOD. Cost-growth analysis data is presented for 120 acquisitions, other than weapons systems, having 100 percent or more cost growth. Analysis was based on changes in quantity, engineering, support, schedule, economic, estimating, and sundry categories. Inflation accounted for 46 percent of this growth.