Flying Through the Budget Flak

jkitfield@njdc.com

As it flies through increasingly heavy flak over Washington, the Air Force's F-22 Raptor provides an apt metaphor for military aircraft in general. Due to numerous direct budget hits and subsequent delays, the program has been restructured three times. The planned buy of aircraft has been continually reduced, from 750 to 600 to 438 to 339. Cost per aircraft has soared each time as development costs are spread across fewer units, with the price tag for a single F-22 now approaching $180 million. And still the decision to begin full-scale production of the aircraft remains over the horizon.

"Certainly the F-22 program has taken longer than we planned, it's been restructured multiple times, and it's wound up costing more than we planned," says Pentagon acquisition chief Jacques Gansler, who earlier this year put off a decision on entering full-scale production until December so that more tests of the plane could be conducted.

"We are concerned that there was not adequate testing data, which is why I conditioned the release of production funding on further testing. But I wanted to go ahead with producing the first two aircraft rather than delay the program another year," Gansler explains.

The Pentagon's fiscal 1999 budget request seeks $785 billion for procuring the first two F-22 "air dominance" fighters, which will eventually replace the Air Force's aging fleet of F-15 fighters. The budget also includes $1.6 billion for continued development of the aircraft and $26 million for initial spare parts.

Questions persist about the affordability of the F-22, however, and the Defense Department's aircraft modernization plans in general. A 1996 DoD study, for instance, indicated that total program costs for the F-22 could grow from a projected $70 billion to $85 billion if changes were not made. Since then, prime contractor Lockheed Martin has taken the unusual risk of agreeing to produce the first eight aircraft under a firm, fixed-price contract to guard against cost growth.

The program reportedly has already brought the company $10 billion in revenue and is expected to prove Lockheed's third biggest moneymaker this year, behind the F-16 Falcon fighter and C-130 Hercules transport.

In March, the General Accounting Office recommended postponing the program another year due to the lack of adequate testing data, especially on such a large-scale and critical weapons program. Air Force officials argue, however, that further major delays will saddle the program with unacceptable costs.

"We're about eight months behind schedule, and I think the decision to buy the first two aircraft and delay a full-scale production decision was prudent. But our best estimate is that delaying the whole program another year would have cost American taxpayers an extra $2.75 billion," said Air Force Chief of Staff Gen. Michael Ryan in a recent interview with defense reporters. "Remember, the YF-22 prototype flew for 155 hours, we have 56,000 hours of wind-tunnel tests, and the engine has been running for a long time. Aerodynamically this is a proven airplane, and from what we know it will greatly enhance our ability to dominate air space in the 21st century."

The Air Force's other major aircraft priority is the C-17 airlifter, built by Boeing. The Pentagon requested $3.2 billion for the program in fiscal 1999, including $2.9 billion to buy 13 additional aircraft (to date the service has procured 57 C-17s). Under current plans, the Air Force will buy another 50 C-17s by 2003, for a total of 120 aircraft.

Joint Strike Fighter

Lockheed Martin is clearly hoping that the new technologies it develops for the F-22 will prove pivotal in its fight with arch rival Boeing to win the Pentagon's other upcoming tactical aircraft program, the Joint Strike Fighter (JSF).

A joint Air Force and Navy effort, the JSF program will ultimately provide the family of aircraft that replaces Air Force F-16s, Marine Corps AV-8Bs and Navy F-18s, as well as giving the Navy a stealthy strike fighter to complement its new F/A-18EFs.

The fiscal 1999 budget request would provide $920 million for the JSF, with engineering and manufacturing development slated to begin in 2001 and initial production in 2004. The services ultimately plan on buying nearly 3,000 JSFs at a total program cost likely in excess of $165 billion, making it potentially the Pentagon's largest program.

DoD officials insist that costs will be a major driver in decisions about the JSF's future. "We are clearly attempting to make affordability a major consideration with the Joint Strike Fighter, and to keep competition in that program as long as possible so that we can get maximum performance at a low cost," says Gansler.

Naval Aircraft

The Pentagon's third major tactical aircraft program is the Navy's F/A-18E/F Super Hornet, a substantially altered variant of the current F/A-18 intended to replace F-14s, A-6Es and older F/A-18s on carrier decks.

DoD requested $3 billion for fiscal 1999 to procure 30 aircraft and $260 million for continued development. Prime contractor Boeing delivered the first 12 aircraft in fiscal 1997.

The planned buy of F/A-18E/Fs was reduced from 1,000 to somewhere between 548 and 785 in last year's Quadrennial Defense Review. The lower figure represents the current plan, and the higher number the buy if problems or delays crop up in the JSF program. Navy officials say cutting the size of the program should reduce overall costs from roughly $80 billion to $60 billion.

"By helping us retire F-14s and A-6s, and replacing them with Super Hornets, we're greatly reducing the total ownership costs of our aircraft fleet," Adm. Jay Johnson, chief of naval operations, told reporters recently.

The Pentagon also plans to spend $715 million in fiscal 1999 to buy seven more V-22 Ospreys (the first five were purchased in 1997), which are tilt-rotor, vertical takeoff and landing aircraft primarily designed to replace Marine Corps CH-46E and CH-53D helicopters. Built by a joint team of Textron's Bell Helicopter division and Boeing Vertol, the V-22 will perform airborne assault, vertical lift, combat search and rescue, and special operations missions. Under current plans, the Marine Corps will procure a total of 80 MV-22s over the next five years at a cost of $6.7 billion, while the Air Force will buy 19 CV-22s for roughly $1.4 billion.

Army Rotary Aircraft

The Army's top acquisition priority remains the ever-elusive RAH-66 Comanche armed reconnaissance helicopter, considered the linchpin in service efforts to begin replacing its aging fleet of Vietnam-era helicopters.

Specifically, the Comanche will replace the OH-58 scout and AH-1 Cobra attack aircraft. The Comanche, however, remains exhibit A in what happens to a program that is stretched out and delayed virtually into oblivion.

The Comanche program is currently limited to long-term prototype development, with the Army requesting $368 million in fiscal 1999. Airframe and avionics development is being conducted by a joint venture between United Technologies' Sikorsky Aircraft Division and Boeing Vertol, while engine development is being done by a partnership of Allied Signal and Allison Engine Co. Ultimately, the Army plans to procure 1,292 Comanches, but production is not scheduled to begin until 2004.

In the meantime, the Army is focusing on its Longbow Apache upgrade program, which would receive $634 million under fiscal 1999 plans (plus $346 million for 2,000 Longbow Hellfire missiles). Under the program, a portion of the Apache attack helicopter fleet will be equipped with mast-mounted fire control radars integrated by a team consisting of Lockheed Martin and Northrop Grumman, providing the selected craft with greatly enhanced survivability and a fire-and-forget Hellfire capability against enemy armored forces.

The Army has also requested $221 million in fiscal 1999 to buy an additional 22 Blackhawk UH-60 utility helicopters, built by Sikorsky Aircraft. The modern workhorse of the Army helicopter fleet, the twin-engine Blackhawk will be procured in batches of 10 each year through 2003 under current plans.

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