Friday, January 10, 2014

RAND: no life-cycle cost savings from joint aircraft

RAND has a recent report out examining the historical performance of joint (i.e. multi-service) aircraft development programs. Their key findings are:
  • Joint aircraft programs have not historically saved overall life cycle cost. On average, such programs experienced substantially higher cost growth in acquisition (research, development, test, evaluation, and procurement) than single-service programs. The potential savings in joint aircraft acquisition and operations and support compared with equivalent single-service programs is too small to offset the additional average cost growth that joint aircraft programs experience in the acquisition phase.

  • The difficulty of reconciling diverse service requirements in a common design is a major factor in joint cost outcomes. Diverse service requirements and operating environments work against commonality which is the source of potential cost savings, and are a major contributor to the joint acquisition cost-growth premium identified in the cost analysis.

  • Historical analysis suggests joint programs are associated with contraction of the industrial base and a decline in potential future industry competition, as well as increased strategic and operational risk due to dependency across the services on a single type of weapon system which may experience unanticipated safety, maintenance, or performance issues with no alternative readily available.
Here's the Abstract:
In the past 50 years, the U.S. Department of Defense has pursued numerous joint aircraft programs, the largest and most recent of which is the F-35 Joint Strike Fighter (JSF). Joint aircraft programs are thought to reduce Life Cycle Cost (LCC) by eliminating duplicate research, development, test, and evaluation efforts and by realizing economies of scale in procurement, operations, and support. But the need to accommodate different service requirements in a single design or common design family can lead to greater program complexity, increased technical risk, and common functionality or increased weight in excess of that needed for some variants, potentially leading to higher overall cost, despite these efficiencies. To help Air Force leaders (and acquisition decisionmakers in general) select an appropriate acquisition strategy for future combat aircraft, this report analyzes the costs and savings of joint aircraft acquisition programs. The project team examined whether historical joint aircraft programs have saved LCC compared with single-service programs. In addition, the project team assessed whether JSF is on track to achieving the joint savings originally anticipated at the beginning of full-scale development. Also examined were the implications of joint fighter programs for the health of the industrial base and for operational and strategic risk.
JSF is now expected to be more expensive than 3 F-22-like single-service programs:

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