DoD Early Estimates Two Tankers Have High Costs

October 20, 2009 by Matthew Potter · Comment
Filed under: KC-X, KC-X Tanker News, U.S. Air Force 
Prior to the release of the latest RFP for the KC-X tanker program some in Congress and the media mooted using a split award for the aircraft. This would allow for faster fielding of tankers to expedite replacement of the older KC-135’s. It would also possibly reduce the chance of a protest by either Northrop or Boeing as well as spreading the contract around to different states. The biggest issue with the idea is that it would add cost to the program. Through the necessity of having two separate support tails the overall program would be more expensive. There would be two training tracks, sets of support equipment and parts pools alone. The aircraft also may not be complimentary. The DoD estimated back in April that the total additional cost would be over $14 billion. Obviously neither the Air Force or the U.S. Government has this kind of money available to support the idea. It would have to be payed for at the expense of other Air Force or DoD programs. It may be that cost estimates with more refinement are created that reduce this, but right now the plan is one company and one aircraft.

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Shockingly weapon systems tend to be late and more expensive then originally planned

April 1, 2008 by Matthew Potter · 2 Comments
Filed under: Department of Defense, Federal Budget Process, GAO, development program 

In their regular annual review of weapon system acquisition the GAO figured out the current programs are on average 2 years behind schedule and a few billion over initial budget estimates. See the story here. Shocking!! This has always been the trend with these large systems. The initial cost estimates and schedules are optimistic and are based on the requirement set that exists when the contract is awarded. As the program develops and requirements change it takes time and money to fix the issues as they develop. Testing, which usually doesn’t happen until later in the program, reveals issues that take time to fix and then adds additional tests. All of these factors have been consistent for years. The only way that this is not going to happen is if everything goes perfectly, which is a little unrealistic expectation.

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