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United States Government Accountability Office: GAO: 

Report to Congressional Committees: 
March 2014: 

Defense Acquisitions: 

Assessments of Selected Weapon Programs: 

GAO Highlights: 

Highlights of GAO-14-340SP, a report to congressional committees. 

Why GAO Did This Study: 

This is GAO's annual assessment of DOD weapon system acquisitions, an 
area that is on GAO's High-Risk List. DOD and Congress have taken 
meaningful steps to improve the acquisition of major weapon systems, 
yet many programs are still falling short of cost and schedule 
estimates. Moreover, GAO has emphasized the importance of completing 
developmental testing before programs enter production and pointed out 
risks associated with such concurrent testing and production. With 
expected budgetary pressures, DOD cannot afford to miss opportunities 
to address inefficiencies in these programs to free up resources for 
higher priority needs. 

This report responds to a mandate in the joint explanatory statement 
to the DOD Appropriations Act, 2009. It includes observations on (1) 
the cost and schedule performance of DOD's 2013 portfolio of 80 major 
defense acquisition programs; (2) the knowledge attained at key 
junctures in the acquisition process for 38 programs that were in 
development or early production; and (3) key acquisition reform 
initiatives and program concurrency. To develop the observations in 
this report, GAO analyzed cost, schedule, and quantity data from DOD's 
Selected Acquisition Reports. GAO also collected data from program 
offices on technology, design, and manufacturing knowledge; the use of 
knowledge-based acquisition practices; and the implementation of 
acquisition reforms and initiatives. 

In commenting on a draft of this report, DOD cited its commitment to 
acquisition excellence and its positive effect on programs. 

What GAO Found: 

Over the past year, the overall size of DOD's major defense 
acquisition program portfolio decreased, from 85 programs to 80, while 
the estimated cost has increased by $14.1 billion. The average time to 
deliver initial capability to the warfighter also increased by 2 
months. The slight cost increase can be attributed to the addition of 
one program, the Evolved Expendable Launch Vehicle. This furthers a 
trend for decreased portfolio size seen for the past three years. 
Although the overall cost of the 2013 portfolio increased, 50 of the 
80 programs decreased costs, and 64 percent of programs increased 
their buying power. There are still some programs that have performed 
poorly, both over the past year and in the longer term. Fifty-five 
percent of the current portfolio funding has been appropriated, 
leaving approximately $682 billion needed for future funding. About 
forty-five percent of this remaining funding represents cost growth 
from initial estimates, a clear indicator that DOD needs to do more to 
control cost growth. 

Figure: DOD Portfolio Cost and Size, 2004-2013: 

[Refer to PDF for image: combined vertical bar and line graph] 

Fiscal year 2014 dollars: 

Portfolio year: 2004; 
Total portfolio acquisition cost: $1.493 billion; 
Number of programs: 80. 

Portfolio year: 2005; 
Total portfolio acquisition cost: $1.527 billion; 
Number of programs: 90. 

Portfolio year: 2006; 
Total portfolio acquisition cost: $1.614 billion; 
Number of programs: 88. 

Portfolio year: 2007; 
Total portfolio acquisition cost: $1.651 billion; 
Number of programs: 94. 

Portfolio year: 2008; 
Total portfolio acquisition cost: $1.633 billion; 
Number of programs: 95. 

Portfolio year: 2010; 
Total portfolio acquisition cost: $1.666 billion; 
Number of programs: 99. 

Portfolio year: 2011; 
Total portfolio acquisition cost: $1.659 billion; 
Number of programs: 95. 

Portfolio year: 2012; 
Total portfolio acquisition cost: $1.501 billion; 
Number of programs: 85; 

Portfolio year: 2013; 
Total portfolio acquisition cost: $1.515 billion; 
Number of programs: 80. 

Note: The 2009 portfolio is excluded as the appropriate data was not 
available for review. 

Source: GAO analysis of DOD data. 

[End of figure] 

Most of the 38 programs GAO assessed this year are not yet fully 
following a knowledge-based acquisition approach. This held true for 
the seven programs that passed through one of three key decision 
points in the past year. Each implemented some knowledge based 
practices but practices—such as fully maturing technologies prior to 
development start and bringing all manufacturing processes under 
control—were not implemented. As a result, many of the 38 programs 
will carry unwanted risk into subsequent phases of acquisition that 
could result in cost growth or schedule delays.
Implementation of the reform initiatives on the 38 programs assessed 
above, and 18 that are not yet major defense acquisition programs, GAO 
analyzed varies. Specifically, while the department has been 
successful in implementing its “should cost” initiative to reduce 
contract costs and established configuration steering boards, the 
establishment of limits on total program costs (i.e. affordability 
constraints) and the need for greater competition are not being 
implemented to the same degree. In addition, many programs continue to 
commit to production before completing developmental testing 

View [hyperlink, http://www.gao.gov/products/GAO-14-340SP]. For more 
information, contact Michael J. Sullivan at (202) 512-4841 or 
sullivanm@gao.gov. 

[End of section] 

Contents: 

Foreword: 

Letter: 

Observations on the Cost and Schedule Performance of DOD's 2013 Major 
Defense Acquisition Program Portfolio: 

Observations from Our Assessment of Knowledge Attained by Programs at 
Key Acquisition Junctures: 

Observations about DOD's Implementation of Key Acquisition Reform 
Initiatives and Program Concurrency: 

Assessments of Individual Programs: 

Statement on Small Business Participation: 

Two-Page Assessments of Individual Programs: 

AIM-9X Block II Air-to-Air Missile (AIM-9X Block II): 

Air and Missile Defense Radar (AMDR): 

CH-53K Heavy Lift Replacement Helicopter (CH-53K): 

DDG 1000 Zumwalt Class Destroyer (DDG 1000): 

Enhanced Polar System (EPS): 

Evolved Expendable Launch Vehicle (EELV): 

Excalibur Precision 155mm Projectiles (Excalibur): 

F-22 Increment 3.2B: 

F-35 Lightning II Program (F-35): 

Family of Beyond Line-of-Sight - Terminals (FAB-T): 

Gerald R. Ford Class Nuclear Aircraft Carrier (CVN 78): 

Global Positioning System III (GPS III): 

Ground/Air Task Oriented Radar (G/ATOR): 

Integrated Air and Missile Defense (IAMD): 

Joint Air-to-Surface Standoff Missile Extended Range (JASSM-ER): 

Joint Light Tactical Vehicle (JLTV): 

Joint Precision Approach and Landing System Increment 1A (JPALS Inc 
1A): 

Joint Tactical Radio System Handheld, Manpack, and Small Form Fit 
Radios (JTRS HMS): 

KC-46 Tanker Modernization Program (KC-46): 

LHA 6 America Class Amphibious Assault Ship (LHA 6): 

Littoral Combat Ship (LCS): 

Littoral Combat Ship - Mission Packages (LCS MP): 

Mobile User Objective System (MUOS): 

MQ-1C Gray Eagle Unmanned Aircraft System (MQ-1C Gray Eagle): 

MQ-4C Triton Unmanned Aircraft System (MQ-4C Triton): 

MQ-8 (Fire Scout): 

MQ-9 Reaper Unmanned Aircraft System (MQ-9 Reaper): 

Next Generation Operational Control System (GPS OCX): 

P-8A Poseidon Multi-Mission Maritime Aircraft (P-8A): 

Paladin Integrated Management (PIM): 

Presidential Helicopter Fleet Replacement Program (VXX): 

RQ-4A/B Global Hawk Unmanned Aircraft System (RQ-4A/B Global Hawk): 

Ship to Shore Connector Amphibious Craft (SSC): 

Small Diameter Bomb Increment II (SDB II): 

Space Fence: 

Warfighter Information Network-Tactical Increment 2 (WIN-T Inc 2): 

Warfighter Information Network-Tactical Increment 3 (WIN-T Inc 3): 

One-Page Assessments of Individual Programs: 

Airborne and Maritime/Fixed Station Joint Tactical Radio System (AMF 
JTRS): 

Amphibious Combat Vehicle (ACV): 

Armored Multi-Purpose Vehicle (AMPV): 

B-2 Defensive Management System Modernization (B-2 DMS): 

Combat Rescue Helicopter (CRH): 

Common Infrared Countermeasure (CIRCM): 

DDG 51 Destroyer (DDG 51): 

F-15 Eagle Passive/Active Warning and Survivability System (F-15 
EPAWSS): 

Ground Combat Vehicle (GCV): 

Indirect Fire Protection Capability-Increment 2 (IFPC Inc 2): 

Joint Air-to-Ground Missile (JAGM): 

Joint Land Attack Cruise Missile Defense Elevated Netted Sensor
System (JLENS): 

Military GPS User Equipment (MGUE), Increment 1: 

Next Generation Jammer (NGJ): 

Ohio-Class Replacement (OR): 

Presidential Aircraft Recapitalization (PAR): 

Space Based Infrared Satellite System (SBIRS High): 

Three-Dimensional Expeditionary Long-Range Radar (3DELRR): 

Unmanned Carrier-Launched Airborne Surveillance and Strike (UCLASS) 
System: 

Agency Comments and Our Evaluation: 

Appendixes: 

Appendix I: Scope and Methodology: 

Appendix II: Current and First Full Estimates for DOD's 2013 Portfolio 
of Major Defense Acquisition Programs: 

Appendix III: Changes in DOD's 2013 Portfolio of Major Defense 
Acquisition Programs over 5 Years and Since First Full Estimates: 

Appendix IV: Knowledge-Based Acquisition Practices: 

Appendix V: Technology Readiness Levels: 

Appendix VI: Major Defense Acquisition Programs' Individual 
Subcontracting Reports in the Electronic Subcontracting Reporting 
System: 

Appendix VII: Comments from the Department of Defense: 

Appendix VIII: GAO Contact and Staff Acknowledgments: 

Related GAO Products: 

Tables: 

Table 1: Changes in DOD's Portfolio of Major Defense Acquisition
Programs from 2012 to 2013: 

Table 2: Changes in DOD's 2013 Portfolio of 80 Major Defense
Acquisition Programs over the Past Year: 

Table 3: Increases in Buying Power for the 2013 Portfolio over the
Past Year: 

Table 4: Cost Changes in DOD's 10 Costliest Programs in Comparison to 
the Rest of the Current Portfolio: 

Table 5: Cost and Schedule Change since First Full Estimates by
System Type: 

Table 6: Future Funding and Future Funding Required Due to Cost
Growth from First Full Estimates: 

Table 7: Use of Activities to Ensure Competition Reported by
Future and Current Programs: 

Table 8: Current Cost Estimates and First Full Estimates for DOD's
2013 Portfolio of Major Defense Acquisition Programs: 

Table 9: Cost and Schedule Changes for Programs in DOD's 2013 
Portfolio: 

Table 10: Best Practices for Knowledge-based Acquisitions: 

Table 11: Major Defense Acquisition Programs' Individual
Subcontracting Reports in the Electronic Subcontracting
Reporting System: 

Figures: 

Figure 1: DOD Portfolio Cost and Size, 2004-2013: 

Figure 2: Distribution of the Total Acquisition Cost Change for the
2013 Portfolio: 

Figure 3: Comparison of the Cost Performance of DOD's 2011, 2012, and 
2013 Portfolios: 

Figure 4: Proportion of Development and Procurement Funding for the 10 
Costliest Programs: 

Figure 5: DOD's Acquisition Cycle and GAO Knowledge Points: 

Figure 6: Implementation of Knowledge-Based Practices for Programs in 
System Development: 

Figure 7: Implementation of Knowledge-Based Practices for Programs at 
Critical Design Review: 

Figure 8: Implementation of Knowledge-Based Practices for Programs at 
Production Decision: 

Figure 9: Realized and Expected “Should-Cost” Savings Reported by 31 
Programs: 

Figure 10: Illustration of Program Two-Page Assessment: 

Figure 11: Examples of Knowledge Scorecards: 

Abbreviations: 

AEHF: Advanced Extremely High Frequency: 

AMDR: Air and Missile Defense Radar: 

BMDS: Ballistic Missile Defense System: 

CSB: configuration steering board: 

DAMIR: Defense Acquisition Management Information Retrieval: 

DDG 51: DDG 51 Arleigh Burke Class Guided Missile Destroyer: 

DOD: Department of Defense: 

eSRS: Electronic Subcontracting Reporting System: 

G/ATOR: Ground/Air Task Oriented Radar: 

GCV: Ground Combat Vehicle: 

JLTV: Joint Light Tactical Vehicle: 

LCS: Littoral Combat Ship: 

MRL: manufacturing readiness level: 

NA: not applicable: 

OMB: Office of Management and Budget: 

PIM: Paladin Integrated Management: 

SAR: Selected Acquisition Report: 

SIBRS: Space Based Infrared System: 

TBD: to be determined: 

TRL: technology readiness level: 

WIN-T Inc 3: Warfighter Integration Network-Tactical Increment 3: 

WSARA: Weapon Systems Acquisition Reform Act: 

[End of section] 

United States Government Accountability Office: 
GAO: 
Comptroller General of the United States: 
441 G St. N.W. 
Washington, DC 20548: 

March 31, 2014: 

Congressional Committees: 

I am pleased to present GAO's 12th annual assessment of the Department 
of Defense's (DOD) major defense acquisition programs. This report 
offers observations on the performance of DOD's current $1.5 trillion 
portfolio of 80 programs. At its current size, this portfolio will 
require almost one-third of all expected development and procurement 
funding during the next 5 years. With the decline in the availability 
of discretionary funding, DOD cannot afford to miss opportunities to 
address inefficiencies in these programs to free up resources for 
additional high priority needs such as support of current operations. 
Consistent with our past recommendations, Congress and DOD have taken 
meaningful steps over the past several years to address long-standing 
problems with DOD weapon system acquisitions--an area that has been on 
GAO's high-risk list for more than 20 years.[Footnote 1] We are 
encouraged about these steps, but we are also mindful that previous 
attempts to implement best practices and reign in cost and schedule 
overruns have failed or resulted in only marginal improvements. 

Our current assessment shows that the estimated cost of DOD's 2013 
portfolio of major defense acquisition programs is $14.1 billion more 
than the 2012 portfolio while the size of the portfolio decreased from 
85 to 80 programs.[Footnote 2] This places the size and cost of the 
portfolio on par with what it was for the 2004 portfolio, as opposed 
to the peak in size and cost seen in the $1.7 trillion, 97-program 
portfolio in 2010. Over the past year, the 80 programs of the 2013 
portfolio have grown by a total of $12.6 billion, a net cost increase 
nearly all attributable to the significant procurement cost associated 
with one program--the Evolved Expendable Launch Vehicle. The cost 
growth of the portfolio as a whole is not necessarily indicative of 
the performance of every program as 50 of the 80 programs reduced 
their costs over the past year. While a large number of programs did 
reduce cost over the past year, the need for continued oversight and 
cost management remains as many programs are still not achieving the 
long-range targets for limited total acquisition cost growth discussed 
by GAO, DOD, and the Office of Management and Budget. Our assessment 
also shows that the implementation of knowledge-based acquisition 
practices varied across the portfolio, though programs that entered 
over the past 5 years were more likely to follow knowledge-based 
principles at development start thereby making them more likely to 
achieve their cost, schedule, and performance objectives. Finally, our 
analysis shows that many programs are implementing selected 
acquisition reforms focused on affordability and cost savings, 
although DOD continues to accept risks by allowing programs to begin 
production before completing developmental testing. This report also 
includes brief assessments of 56 future and current major defense 
programs that provide additional insights into the performance of the 
portfolio. 

Current and anticipated fiscal constraints make it imperative that DOD 
continue to find ways to improve the efficiency of its major weapon 
systems portfolio while still delivering the capabilities required by 
the warfighter. While many of the recent efficiencies achieved by 
programs decreased their costs without reducing quantities, it is 
unclear how much more savings can be obtained in this manner or if the 
estimates of future saving based upon ongoing DOD efficiency 
initiatives will come to fruition. Continued strong leadership on the 
part of DOD is essential, whether on advancing gains made through 
Better Buying Power initiatives or in enforcing a broader 
implementation of best practices in all aspects of a new weapon system 
acquisition as it enters the portfolio. 

Signed by: 

Gene L. Dodaro: 
Comptroller General of the United States: 

[End of section] 

United States Government Accountability Office: 
GAO:
441 G St. N.W. 
Washington, DC 20548: 

March 31, 2014: 

Congressional Committees: 

In response to the mandate in the joint explanatory statement to the 
Department of Defense Appropriations Act, 2009, this report provides 
perspectives on how well the department is planning and executing its 
$1.5 trillion portfolio of major weapon programs.[Footnote 3] The 
current portfolio's cost has declined since peaking at $1.7 trillion 
in 2010 and is currently at its lowest point in almost 10 years. In 
addition, the number of programs in the portfolio has decreased from 
97 in 2010 to 80 programs in 2013. Since the first issuance of this 
series of reports in 2003, Congress and DOD have made meaningful 
improvements to the statutory and policy frameworks that govern the 
defense acquisition system by mandating and encouraging a more 
knowledge-based approach for major weapon programs. However, we have 
noted in the past that practice has lagged behind policy in certain 
areas and commensurate improvements in program outcomes are often not 
evident as many programs continue to cost more and take longer to 
develop than originally estimated. 

The changes in DOD's portfolio over the past few years indicate that 
some improvements are being realized in the near term. With the 
prospect of decreased defense budgets in the near future, it is 
imperative that DOD continue to find ways to reduce cost and improve 
the economy and efficiency of its acquisition practices not only in 
the short term, but throughout the life of current and future defense 
acquisition programs. Such cost reductions may be found by changing 
program acquisition strategies to include a more knowledge-based 
approach through the implementation of acquisition reforms and 
initiatives and the reduction of practices like concurrent testing and 
production, the risks of which we have identified repeatedly. 

This report includes observations on (1) the cost and schedule 
performance of DOD's 2013 portfolio of 80 major defense acquisition 
programs, (2) the knowledge attained at key junctures in the 
acquisition process for 38 weapon programs in development or early 
production, and (3) key acquisition reform initiatives and whether 
programs are conducting or planning concurrent testing and production. 
[Footnote 4] 

Our observations in this report are based on three sets of programs: 

* We assessed 80 major defense acquisition programs in DOD's 2013 
portfolio for our analysis of cost and schedule performance. We 
obtained cost, schedule, and quantity data from DOD's December 2012 
Selected Acquisition Reports (SAR) and from the Defense Acquisition 
Management Information Retrieval Purview system. 

* We assessed 38 major defense acquisition programs that were mostly 
between the start of development and the early stages of production 
for our analysis of knowledge attained at key junctures and the 
implementation of acquisition reforms. We obtained information on the 
extent to which the programs follow knowledge-based practices for 
technology maturity, design stability, and production maturity using a 
data-collection instrument. We also submitted a questionnaire to 
program offices to collect information on issues such as systems 
engineering reviews, design stability, manufacturing planning and 
execution, and the implementation of specific acquisition reforms. We 
received questionnaire responses from all 38 programs from August to 
November 2013. 

* In addition, we assessed 18 future major defense acquisition 
programs in order to gain additional insights into knowledge attained 
before the start of development and the implementation of key 
acquisition reform initiatives. We submitted a questionnaire to 
program offices to collect information on issues such as program 
schedule events, costs, and numerous acquisition reforms, and received 
responses from all 18 programs from August to November 2013. 

In addition to our observations, we present individual assessments of 
56 weapon programs. Selection factors include major defense 
acquisition programs in development or early production, future 
programs, and recently canceled or restructured programs. 

We conducted this performance audit from June 2013 to March 2014 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 based on our audit objectives. Appendix I contains detailed 
information on our scope and methodology. 

Observations on the Cost and Schedule Performance of DOD's 2013 Major 
Defense Acquisition Program Portfolio: 

The estimated cost of DOD's 2013 portfolio of 80 weapon programs is 
$14.1 billion more than the 2012 portfolio of 85 programs. The 80 
programs within this year's portfolio have had estimated cost 
increases of $12.6 billion against their estimates from a year ago and 
an average of 2 months increase in schedule. This increase masks 
otherwise positive trends as 50 of 80 programs in the portfolio 
decreased their total acquisition costs and the majority of the cost 
increases can be traced to either the effects of additional 
procurement quantities or inefficiencies experienced in a few 
programs. Though notable, the cost reductions achieved by the programs 
in the 2013 portfolio over the past year need to be weighed against 
the increases many of these programs have had over the past five years 
or since their first full estimate of costs. Our analysis of DOD's 
2013 portfolio allows us to make the following eight observations. 

Text box: 

Cost and Schedule Performance Observations: 

General changes in the portfolio: 

1. When compared to the 2012 portfolio, the size of DOD's 2013 
portfolio decreased from 85 to 80 programs, but its overall cost has 
increased by $14.1 billion from $1,501 billion to $1,515 billion. The 
decrease in portfolio size follows a trend from the past 3 years.[A] 

2. When comparing the cost and schedule estimates of the 80 programs 
in the 2013 portfolio we found cost growth of $12.6 billion and an 
average schedule delay of 2 months over the past year. When assessed 
against first full estimates, the total cost of the 2013 portfolio has 
increased by nearly $448 billion with an average delay of 28 months in 
operating capability.[B] 

Factors that explain the changes: 

3. While the overall cost of the 2013 portfolio has increased, 50 of 
the 80 programs within the portfolio reduced their costs over the past 
year. The majority of the net cost growth can be attributed to a 
single program, the Evolved Expendable Launch Vehicle (EELV). 

4. Our analysis shows that, when the effects of quantity changes are 
accounted for, DOD improved buying power on 64 percent of the programs 
in the portfolio over the past year. 

5. As measured against metrics discussed by GAO, the Office of 
Management and Budget, and DOD in 2008, only 55 percent of programs in 
the 2013 portfolio meet the metric for less than 10 percent growth 
over the past 5 years and only 44 percent meet the metric for less 
than 15 percent growth since first full estimates; both proportions 
are smaller than in the 2012 portfolio, which demonstrates that a 
program can experience an interval of cost stability between periodic 
cost increases. 

Other observations: 

6. The total acquisition cost of the portfolio is driven in large part 
by the 10 costliest programs, which represent 59 percent of current 
portfolio's total cost. These 10 programs alone incurred a net cost 
increase over the past year of approximately $15.4 billion due 
primarily to quantity increases on the EELV, while the other 70 
programs reported a net cost decrease of $2.8 billion over the same 
period. 

7. The majority of the cost of the portfolio is concentrated in two 
system types and the amount and type of cost growth from first full 
estimate, as well as the schedule delay, varied significantly by 
system type. 

8. DOD has already been appropriated more than $833 billion for the 
current portfolio, leaving approximately $682 billion in costs to be 
funded, mostly for procurement. Approximately 45 percent of the 
remaining cost represents growth from first full estimates. Almost two-
thirds of the future funding is needed for 10 programs, with 35percent 
of the total costs remaining required for the F-35 program alone. 

[A] All dollar figures are in fiscal year 2014 constant dollars, 
unless otherwise noted. 

[B] Total acquisition cost includes acquisition-related operation and 
maintenance costs and system-specific military construction costs in 
addition to development and procurement costs. 

[End of text box] 

Additional details about each observation follow. 

1. When compared to the 2012 portfolio, the size of DOD's 2013 
portfolio decreased from 85 to 80 programs, but its overall cost has 
increased by $14.1 billion, from $1,501 billion to $1,515 billion. The 
decrease in portfolio size follows a trend from the past 3 years. With 
80 programs and an estimated total cost of more than $1.5 trillion, 
the 2013 portfolio has fewer programs but a larger total acquisition 
cost when compared to the 2012 portfolio. The changes from the 2012 
portfolio to the 2013 portfolio are outlined in table 1 below. 

Table 1: Changes in DOD's Portfolio of Major Defense Acquisition 
Programs from 2012 to 2013: 

Fiscal year 2014 dollars in billions: 

2012 portfolio (85 programs): $1,501.1. 

Less cost of 12 exiting programs: -$73.1. 

Plus estimated total cost of 7 entering programs: +$101.6. 

Less net cost changes of 73 remaining programs: -$14.4. 

2013 portfolio (80 programs): $1,515.2. 

Source: GAO analysis of DOD data. 

Note: Our assessment of DOD's 2012 portfolio included the Ballistic 
Missile Defense System (BMDS). We exclude it from our assessment this 
year as the program lacks an acquisition program baseline comparable 
to other programs, preventing us from measuring cost and schedule 
change in a manner consistent with our methodology. To make the 
comparisons above we adjusted the 2012 portfolio estimates to reflect 
the removal of BMDS. Some numbers may not sum due to rounding. 

[End of table] 

The 2013 portfolio reflects a net reduction of 5 programs--from 85 to 
80--and, when all the programmatic changes are taken into account, the 
cost of the 2013 portfolio is $14.1 billion more than the 2012 
portfolio.[Footnote 5] The current size of the portfolio in terms of 
number of programs and total cost is similar to that seen in the 2004 
portfolio and furthers a trend for decreased portfolio size, and to 
some extent cost, seen since the 2010 portfolio. Figure 1 shows the 
cost and size of DOD's portfolios of major weapons acquisitions over 
the past 10 years. 

Figure 1: DOD Portfolio Cost and Size, 2004-2013: 

[Refer to PDF for image: combined vertical bar and line graph] 

Fiscal year 2014 dollars: 

Portfolio year: 2004; 
Total portfolio acquisition cost: $1.493 billion; 
Number of programs: 80. 

Portfolio year: 2005; 
Total portfolio acquisition cost: $1.527 billion; 
Number of programs: 90. 

Portfolio year: 2006; 
Total portfolio acquisition cost: $1.614 billion; 
Number of programs: 88. 

Portfolio year: 2007; 
Total portfolio acquisition cost: $1.651 billion; 
Number of programs: 94. 

Portfolio year: 2008; 
Total portfolio acquisition cost: $1.633 billion; 
Number of programs: 95. 

Portfolio year: 2010; 
Total portfolio acquisition cost: $1.666 billion; 
Number of programs: 99. 

Portfolio year: 2011; 
Total portfolio acquisition cost: $1.659 billion; 
Number of programs: 95. 

Portfolio year: 2012; 
Total portfolio acquisition cost: $1.501 billion; 
Number of programs: 85; 

Portfolio year: 2013; 
Total portfolio acquisition cost: $1.515 billion; 
Number of programs: 80. 

Source: GAO analysis of DOD data. 

Note: The 2009 portfolio is excluded because there were no annual SARs 
released for the December 2008 submission date. 

[End of figure] 

A closer look at the 7 programs that entered the portfolio shows that 
4 entered the portfolio at the beginning of system development. In 
contrast, two of the other three programs--the AN/TPS-80 Ground/Air 
Task Oriented Radar (G/ATOR) and the Airborne Warning and Control 
System Block 40/45 Upgrade--entered the portfolio long after their 
development start and are in production or will have a production 
decision in 2013. These programs were not originally planned as major 
acquisitions, but their costs grew past the threshold for major 
defense acquisition programs. For example, G/ATOR began system 
development in 2005 as a non-major defense acquisition program and was 
reclassified due to program cost growth realized after completing 6 
years of an 8-year development effort. The final program, EELV, re-
entered the portfolio in response to statutory direction and soon 
after reported a quantity increase and a critical Nunn-McCurdy breach. 
[Footnote 6] 

Of the 12 programs that exited the portfolio, 8 completed development 
and fielded a system, while three were canceled after reporting 
substantial development cost growth or delays to their planned initial 
capability or, in one case, both. A final program, the Joint High 
Speed Vessel, exited the portfolio after a quantity reduction caused 
its cost to slip below the threshold for major defense acquisition 
programs. 

2. When comparing the cost and schedule estimates of the 80 programs 
in the 2013 portfolio we found cost growth of $12.6 billion and 
average schedule delay of 2 months over the past year. While the above 
observation states the change from the 85 program 2012 portfolio due 
to programs exiting and entering, in this observation we measure the 
change that occurred only on the 80 programs in the 2013 portfolio. 
Table 2 shows the changes in cost and schedule for the 2013 portfolio 
in the past year. 

Table 2: Changes in DOD's 2013 Portfolio of 80 Major Defense 
Acquisition Programs over the Past Year: 

Fiscal year 2014 dollars in billions: 

Total estimated research and development cost; 
Estimated 2013 portfolio cost in 2012: $286.7; 
Estimated 2013 portfolio cost in 2013: $288.7; 
Increase since 2012: $2.0; 
Percentage change since 2012: 0.7%. 

Total estimated procurement cost; 
Estimated 2013 portfolio cost in 2012: $1,201.6; 
Estimated 2013 portfolio cost in 2013: $1,213.2; 
Increase since 2012: $11.5; 
Percentage change since 2012: 1.0%. 

Total other acquisition costs[A]; 
Estimated 2013 portfolio cost in 2012: $14.3; 
Estimated 2013 portfolio cost in 2013: $13.3; 
Increase since 2012: $-0.9; 
Percentage change since 2012: -6.3%. 

Total estimated acquisition cost; 
Estimated 2013 portfolio cost in 2012: $1,502.6; 
Estimated 2013 portfolio cost in 2013: $1,515.2; 
Increase since 2012: $12.6; 
Percentage change since 2012: 0.8%. 

Average delay in delivering initial capabilities; 
Increase since 2012: $2 months; 
Percentage change since 2012: 2.2%. 

Source: GAO analysis of DOD data. 

Note: Some numbers may not sum due to rounding. 

[A] In addition to research and development and procurement costs, 
total acquisition cost includes acquisition-related operation and 
maintenance and system-specific military construction costs. 

[End of table] 

The rise in total acquisition cost within the current portfolio over 
the past year is attributable to cost growth in both development and 
procurement, with procurement accounting for more than 90 percent of 
the total increase. Decreases in other costs, such as military 
construction, result in a net cost growth of $12.6 billion for these 
80 programs over the past year. When measured against programs' first 
full estimates, the total acquisition cost of the current portfolio 
has grown by $447.8, or nearly 42 percent. The average delay in 
delivering initial capabilities has slipped an additional 2 months 
over the past year. The average delay against first full estimates is 
28 months, on average. 

3. While the overall cost of the 2013 portfolio has increased, 50 of 
the 80 programs within the portfolio reduced their costs over the past 
year. The majority of the net cost growth can be attributed to a 
single program--EELV. The $12.6 billion increase shown in table 2 
above is the net result of cost changes on all 80 programs in the 
current portfolio. The distribution of those cost changes across the 
portfolio is shown below in figure 2. 

Figure 2: Distribution of the Total Acquisition Cost Change for the 
2013 Portfolio: 

[Refer to PDF for image: combined vertical bar and line graph] 

50 programs with cost decreases: 

Percentage change intervals: less than -25%; 
Amount of cost change in each percentage change interval over the past 
year: -0.806%; 
Number of programs in each percentage change interval: 1. 

Percentage change intervals: -25-20%; 
Amount of cost change in each percentage change interval over the past 
year: -1.336%; 
Number of programs in each percentage change interval: 1. 

Percentage change intervals: -20-15%; 
Amount of cost change in each percentage change interval over the past 
year: 0%; 
Number of programs in each percentage change interval: 0. 

Percentage change intervals: -15-10%; 
Amount of cost change in each percentage change interval over the past 
year: -3.559%; 
Number of programs in each percentage change interval: 2. 

Percentage change intervals: -10-5%; 
Amount of cost change in each percentage change interval over the past 
year: -4.44%; 
Number of programs in each percentage change interval: 4. 

Percentage change intervals: -5-0%; 
Amount of cost change in each percentage change interval over the past 
year: -20.733%; [The F-35 program's $11.5 billion cost decrease was 
only a 3% reduction over the past year but makes up a majority of the 
cost change in this interval] 
Number of programs in each percentage change interval: 42. 

30 programs with cost increases: 

Percentage change intervals: 0-5%; 
Amount of cost change in each percentage change interval over the past 
year: 6.725%; 
Number of programs in each percentage change interval: 23. 

Percentage change intervals: 5-10%; 
Amount of cost change in each percentage change interval over the past 
year: 0.377%; 
Number of programs in each percentage change interval: 2. 

Percentage change intervals: 10-15%; 
Amount of cost change in each percentage change interval over the past 
year: 1.427%; 
Number of programs in each percentage change interval: 1. 

Percentage change intervals: 15-20%; 
Amount of cost change in each percentage change interval over the past 
year: 4.215%; 
Number of programs in each percentage change interval: 2. 

Percentage change intervals: 20-25%; 
Amount of cost change in each percentage change interval over the past 
year: 0%; 
Number of programs in each percentage change interval: 0. 

Percentage change intervals: 25-30%; 
Amount of cost change in each percentage change interval over the past 
year: 0%; 
Number of programs in each percentage change interval: 0. 

Percentage change intervals: more than 30%; 
Amount of cost change in each percentage change interval over the past 
year: 30.735%; [The EELV program's $28.1 billion in cost growth was a 
more than 30% increase over the past year and makes up a majority of 
the cost change in this interval] 
Number of programs in each percentage change interval: 2. 

Source: GAO analysis of DOD data. 

[End of figure] 

Our analysis, as represented above, shows that 50 programs experienced 
cost decreases totaling almost $30.9 billion during the past year 
while 30 programs reported cost increases totaling approximately $43.5 
billion. Of the programs that decreased their total acquisition costs, 

* 38 did so by finding efficiencies within the program and not by 
decreasing procurement quantities; 

* 9 reduced their procurement quantities thereby reducing overall 
cost; and: 

* 3 increased their procurement quantities but found enough offsetting 
efficiencies to reduce overall cost. 

The most significant of these decreases is the $11.5 billion reduction 
to the F-35 Joint Strike Fighter program's estimate, due solely to 
efficiencies found within the program as no decrease in quantities was 
reported. In contrast, 30 programs reported cost increases. Of these, 

* 17 reported cost increases due to inefficiencies in the program and 
not any change to procurement quantities; 

* 12 programs increased their procurement quantities; and: 

* 1 program reduced estimated procurement quantities but still 
reported an increase to total costs. 

The most significant of the programs with increases to total 
acquisition cost was EELV, which reported an increase in the number of 
launch services it expected to procure and a $28.1 billion, or 78 
percent, increase in total acquisition cost during the past year. As 
can be seen from the preceding tally of individual cost increases and 
decreases, to better understand the changes to cost the effect of 
changes to quantity must be understood. 

4. Our analysis shows that, when the effects of quantity changes are 
accounted for, DOD improved buying power on 64 percent of the programs 
in the portfolio over the past year. Although procurement costs for 
the portfolio increased by $11.5 billion over the past year, this 
growth is lower than GAO's calculations of the expected cost growth 
due to quantity changes, indicating that programs found efficiencies 
in other areas and increased their buying power.[Footnote 7] In 
general, buying power can be defined as the amount of good or service 
that can be purchased given a specified level of funding. Our 
calculation how programs' cost and quantity changes affected their 
buying power are presented in table 3. 

Table 3: Increases in Buying Power for the 2013 Portfolio over the 
Past Year: 

Fiscal year 2014 dollars in billions: 

Increased buying power: 
Number of programs: 51; 
Actual procurement cost change: -$23.0; 
GAO-calculated cost change attributable to quantity changes: $4.9; 
GAO-calculated cost change not attributable to quantity changes: -
$27.9. 

Procurement cost decreased with no quantity change; 
Number of programs: 35; 
Actual procurement cost change: -$22.6; 
GAO-calculated cost change attributable to quantity changes: 0; 
GAO-calculated cost change not attributable to quantity changes: 
-$22.6. 

Quantity increased with less cost increase than anticipated; 
Number of programs: 10; 
Actual procurement cost change: 4.8; 
GAO-calculated cost change attributable to quantity changes: $7.9; 
GAO-calculated cost change not attributable to quantity changes: -$3.1. 

Quantity decreased with more cost decrease than anticipated; 
Number of programs: 6; 
Actual procurement cost change: -$5.2; 
GAO-calculated cost change attributable to quantity changes: -$3.0; 
GAO-calculated cost change not attributable to quantity changes: -$2.2. 

Decreased buying power; 

Number of programs: 25; 
Actual procurement cost change: $34.5; 
GAO-calculated cost change attributable to quantity changes: $22.4; 
GAO-calculated cost change not attributable to quantity changes: $12.1. 

Procurement cost increased with no quantity change; 
Number of programs: 16; 
Actual procurement cost change: $4.7; 
GAO-calculated cost change attributable to quantity changes: 0; 
GAO-calculated cost change not attributable to quantity changes: $4.7. 

Quantity increased with more cost increase than anticipated; 
Number of programs: 5; 
Actual procurement cost change: $32.1; 
GAO-calculated cost change attributable to quantity changes: $25.3; 
GAO-calculated cost change not attributable to quantity changes: $6.8. 

Quantity decreased with less cost decrease than anticipated; 
Number of programs: 4; 
Actual procurement cost change: -$2.3; 
GAO-calculated cost change attributable to quantity changes: -$2.9; 
GAO-calculated cost change not attributable to quantity changes: $0.5. 

No change in buying power; 
Number of programs: 4; 
Actual procurement cost change: $0; 
GAO-calculated cost change attributable to quantity changes: $0; 
GAO-calculated cost change not attributable to quantity changes: $0. 

Total; 
Number of programs: 80; 
Actual procurement cost change: $11.5; 
GAO-calculated cost change attributable to quantity changes: $27.3; 
GAO-calculated cost change not attributable to quantity changes: -
$15.8. 

Source: GAO analysis of DOD data. 

Note: Some numbers may not sum due to rounding. 

[End of table] 

Based on our analysis, a total of 51 programs increased their buying 
power in the past year, resulting in a total of $23 billion in 
procurement cost reductions. Thirty-five of the programs that 
decreased their procurement cost did so without reducing quantities, 
an indication that they found efficiencies elsewhere. Ten programs 
increased their expected procurement quantities but their total 
procurement cost increase was less than would be expected based upon 
the average procurement unit cost of each program used in GAO's 
calculation. For example, over the past year the DDG 51 program added 
two ships to its planned procurement, at an estimated unit cost of 
more than $1.3 billion. If the resulting procurement cost increase 
from these additional quantities is ignored the cost for the program 
actually decreases, due to the fact that it found efficiencies 
elsewhere that increased the program's buying power even as the 
program increased quantities. An additional 6 programs decreased their 
quantities but achieved cost reductions in excess of that anticipated 
by GAO's cost calculations. For example, the Littoral Combat Ship 
(LCS) program reported a procurement cost decrease of over $3 billion. 
While a significant portion of this reduction was achieved by removing 
three ships from the planned procurement, almost half, $1.2 billion, 
was due to factors other than the quantity reduction, such as a 
revised estimate that reflects lower future costs. 

Increases in buying power such as these could be expected to continue 
as many of the programs that responded to our questionnaire indicated 
that they expected large amounts of "should-cost" savings in the 
future. The "should-cost" initiative, introduced through DOD's Better 
Buying Power initiatives, emphasizes the importance of driving cost 
improvements during contract negotiation and program execution to 
control costs, improvements that could lead to program efficiencies 
which increase buying power. For example, the AIM-9X Block II Air-to-
Air Missile program realized a procurement cost decrease of 
approximately $327 million with no change in quantity over the past 
year and also reported $128 million in "should-cost" savings that are 
expected in the future. In another case, the MQ-4C Triton Unmanned 
Aircraft System also realized decreasing procurement costs of $274 
million over the past year while maintaining the same quantity and 
reported that another $480 million in "should-cost" savings are 
expected in the future. 

Our analysis in table 3 above also shows that procurement costs for 25 
programs increased by $34.5 billion, but by our calculation only $22.4 
billion can be attributed to the cost of procuring additional units, 
with $12.1 billion of that increase attributable to other factors. The 
most significant increase was that of the EELV program, which reported 
increasing its expected launches, the program's measure of quantity, 
by 60 resulting in an estimated $28 billion procurement cost increase, 
$6 billion of which was not attributable to the quantity increase. 

5. As measured against metrics discussed by GAO, the Office of 
Management and Budget (OMB), and DOD in 2008, only 55 percent in the 
2013 portfolio meet the metric for less than 10 percent growth over 5 
years and 44 percent meet the less than 20 percent growth over the 
past 10 years; both proportions are smaller than in the 2012 
portfolio, which demonstrates that a program can experience an 
interval of cost stability between periodic cost increases. In 
December 2008, DOD, OMB, and GAO, discussed a set of outcome metrics 
and goals to measure program cost performance over time. The metrics 
are intended to measure total program cost-performance on a percentage 
basis over three time periods: the preceding year, the preceding 5 
years, and the period since first full program estimates were 
established. We have reported on these outcomes in past assessments. 
Seventy-six percent of the programs in the 2013 portfolio are meeting 
the one-year cost performance metric by limiting their total 
acquisition cost growth to less than 2 percent, consistent with the 
cost decreases and increases explained earlier. Fewer programs, 
however, are meeting the metrics for limited growth in the past five 
years and since first full estimates; 55 percent meet the 5-year 
metric while 44 percent are meeting the since first full estimate 
metric. This demonstrates that some programs with reduced or stable 
costs over the past year have previously had one or more cost 
increases. Programs do not generally experience cost change in a 
linear fashion with set amounts of increase or decrease every year, 
rather they have periods of more dramatic change interspersed with 
periods of stability. The performance of the 2013 portfolio, as well 
as the two previous weapon system portfolios, against these metrics is 
shown in figure 3. 

Figure 3: Comparison of the Cost Performance of DOD's 2011, 2012, and 
2013 Portfolios: 

[Refer to PDF for image: vertical bar graph] 

1-year comparison, less than 2% growth: 
Year: 2011; 
Percent of programs that meet metric: 60%; 
Percent of programs that do not meet metric: 40%. 

Year: 2012; 
Percent of programs that meet metric: 85%; 
Percent of programs that do not meet metric: 15%. 

Year: 2013; 
Percent of programs that meet metric: 76%; 
Percent of programs that do not meet metric: 24%. 

5-year comparison, less than 10% growth: 
Year: 2011; 
Percent of programs that meet metric: 45%; 
Percent of programs that do not meet metric: 55%. 

Year: 2012; 
Percent of programs that meet metric: 56%; 
Percent of programs that do not meet metric: 44%. 

Year: 2013; 
Percent of programs that meet metric: 55%; 
Percent of programs that do not meet metric: 45%. 

First full comparison, less than 15% growth: 
Year: 2011; 
Percent of programs that meet metric: 41%; 
Percent of programs that do not meet metric: 59%. 

Year: 2012; 
Percent of programs that meet metric: 48%; 
Percent of programs that do not meet metric: 52%. 

Year: 2013; 
Percent of programs that meet metric: 44%; 
Percent of programs that do not meet metric: 56%. 

Source: GAO analysis of DOD data. 

Note: Cost growth metric is defined as the percentage change in total 
program acquisition cost. Analysis includes the evaluation of cost 
growth on individual programs in the portfolio for each year. For 
programs where cost growth is measured on separate program sub-
element, the elements were combined to calculate the cost growth on 
the entire program as a whole. 

[End of figure] 

As a whole, aggregate cost performance of the 2013 portfolio has 
degraded across all three metrics from that observed in the 2012 
portfolio. The percentage increase from 2012 to 2013 in programs that 
do not meet the cost metrics is attributable to two factors. First, 
many of the 12 programs that are no longer in the portfolio were 
meeting one or more of the three cost metrics while 2 of the 7 that 
entered--EELV and G/ATOR--do not meet one or more metrics. Second, 
performance against the cost metrics has grown worse on some of the 
ongoing programs. For example, the number of programs that do not meet 
the 1-year cost growth metric increased by 5--eight programs improved 
to meet this criterion in 2013 while the cost performance on 13 other 
programs worsened over the past year. Despite decreases in this metric 
in the past year, the portfolio's performance for 2013 is an 
improvement on the 2011 portfolio, the first year we used this metric. 

6. The 10 highest-cost programs account for 59 percent of the 
development and procurement cost and the majority of cost growth. As 
we have reported in past assessments, the total acquisition cost of 
the portfolio is driven in large part by the 10 costliest programs, 
which currently represent 59 percent of the portfolio's development 
and procurement cost as shown in figure 4 below. 

Figure 4: Proportion of Development and Procurement Funding for the 10 
Costliest Programs: 

[Refer to PDF for image: pie-chart] 

Procurement funding - 10 costliest programs: 49%; 
Procurement funding - remaining programs: 32%; 
Development funding - 10 costliest programs: 10%; 
Development funding - remaining programs: 9%. 

Source: GAO analysis of DOD data. 

[End of figure] 

Interestingly, 6 of the 10 costliest programs in the current portfolio 
were also in the list of 10 costliest programs in the 2004 portfolio, 
and if each of these programs had executed according to the baseline 
approved at development start, 3 of them would have completed 
acquisition and exited the portfolio. 

Over the past year, the 10 costliest programs incurred a net cost 
increase of approximately $15.4 billion, due primarily to quantity 
increases on the EELV program. In contrast, the other 70 programs 
reported a combined cost decrease of $2.8 billion. Similarly, the 10 
costliest programs also account for almost 60 percent of all cost 
growth--or $124.4 billion--over the past 5 years in the current 
portfolio. Table 4 identifies the 10 costliest programs and lists 
their total acquisition cost and cost growth over the past year. 

Table 4: Cost Changes in DOD's 10 Costliest Programs in Comparison to 
the Rest of the Current Portfolio: 

Program name: F-35 Joint Strike Fighter; 
Current total estimated acquisition cost: $332.3; 
Change in acquisition cost over the past year: $-11.5. 

Program name: DDG 51 Arleigh Burke Class Destroyer; 
Current total estimated acquisition cost: $107.8; 
Change in acquisition cost over the past year: 2.4. 

Program name: Virginia Class Submarine; 
Current total estimated acquisition cost: $84.4; 
Change in acquisition cost over the past year: -$2.3. 

Program name: Evolved Expendable Launch Vehicle; 
Current total estimated acquisition cost: $63.9; 
Change in acquisition cost over the past year: 28.1. 

Program name: V-22 Osprey; 
Current total estimated acquisition cost: $60.7; 
Change in acquisition cost over the past year: 0.8. 

Program name: F/A-18E/F Super Hornet; 
Current total estimated acquisition cost: $59.7; 
Change in acquisition cost over the past year: -$1.0. 

Program name: Trident II Missile; 
Current total estimated acquisition cost: $55.5; 
Change in acquisition cost over the past year: 0.6. 

Program name: KC-46 Tanker; 
Current total estimated acquisition cost: $44.5; 
Change in acquisition cost over the past year: -$1.2. 

Program name: CVN 78 Gerald R. Ford Class Aircraft Carrier; 
Current total estimated acquisition cost: $36.0; 
Change in acquisition cost over the past year: -$0.3. 

Program name: P-8A Poseidon; 
Current total estimated acquisition cost: $34.3; 
Change in acquisition cost over the past year: -$0.04. 

Program name: 10 costliest programs; 
Current total estimated acquisition cost: $880.0; 
Change in acquisition cost over the past year: 15.4. 

Program name: Total for rest of the current portfolio; 
Current total estimated acquisition cost: $635.2; 
Change in acquisition cost over the past year: -$2.8. 

Program name: 2013 portfolio total; 
Current total estimated acquisition cost: $1,515.2; 
Change in acquisition cost over the past year: $12.6. 

Source: GAO analysis of DOD data. 

Note: Some numbers may not sum due to rounding. 

[End of table] 

7. The majority of the cost of the portfolio is concentrated in two 
system types and the amount and type of cost growth from first full 
estimate, as well as the schedule delay, varied significantly by 
system type. Over 60 percent of the current portfolio's cost is 
accounted for by two system types--fixed wing manned aircraft and 
shipbuilding programs, both of which experienced unfavorable cost and 
schedule growth from first full estimates. The amount of cost growth, 
and whether that growth occurred in development or procurement, varied 
by the type of system acquired. Table 5 shows the amount of cost 
growth for development and acquisition unit cost experienced by each 
system type as well as the amount of schedule growth. 

Table 5: Cost and Schedule Change since First Full Estimates by System 
Type: 

System type: Shipbuilding; 
Total development cost percentage increase: 113%; 
Procurement unit cost percentage increase: 19%; 
Percentage increase in time to deliver initial capabilities: 53%. 

System type: Unmanned vehicle; 
Total development cost percentage increase: 86%; 
Procurement unit cost percentage increase: 22%; 
Percentage increase in time to deliver initial capabilities: 58%. 

System type: Rotary wing; 
Total development cost percentage increase: 78%; 
Procurement unit cost percentage increase: 74%; 
Percentage increase in time to deliver initial capabilities: 30%. 

System type: Satellite; 
Total development cost percentage increase: 55%; 
Procurement unit cost percentage increase: 85%; 
Percentage increase in time to deliver initial capabilities: 93%. 

System type: Fixed wing; 
Total development cost percentage increase: 43%; 
Procurement unit cost percentage increase: 55%; 
Percentage increase in time to deliver initial capabilities: 34%. 

System type: C4ISR; 
Total development cost percentage increase: 42%; 
Procurement unit cost percentage increase: -8%; 
Percentage increase in time to deliver initial capabilities: 26%. 

System type: Munition; 
Total development cost percentage increase: 17%; 
Procurement unit cost percentage increase: -10%; 
Percentage increase in time to deliver initial capabilities: 16%. 

System type: Missile; 
Total development cost percentage increase: 13%; 
Procurement unit cost percentage increase: 79%; 
Percentage increase in time to deliver initial capabilities: 30%. 

System type: Ground; 
Total development cost percentage increase: 5%; 
Procurement unit cost percentage increase: 62%; 
Percentage increase in time to deliver initial capabilities: 19%. 

Source: GAO analysis of DOD data. 

Note: The procurement unit cost growth estimate was calculated using a 
weighted average based each program's current procurement cost that 
gives more expensive programs a greater value. Three of the 80 
programs in the current portfolio--Chemical Demilitarization-Assembled 
Chemical Weapons Alternatives, EELV, and Ship to Shore Connector--were 
not assessed here as they do not correspond with any of the nine 
system types used. 

[End of table] 

The development cost growth for shipbuilding programs is the greatest 
among all system types and, at approximately 113 percent, is more than 
double that experienced by the portfolio as a whole. For example, the 
DDG 1000 and LCS have experienced more than 342 percent and 148 
percent growth, respectively, in development costs from first full 
estimates. Shipbuilding programs have also experienced significant 
schedule delays with four out of seven programs reporting delays to 
the delivery of initial capability of 2 years or more. We have an 
extensive body of work that covers the problems DOD has experienced in 
developing these systems.[Footnote 8] 

Rotary wing systems have also experienced exceptionally high levels of 
development cost change, with 4 out of 9 rotary wing programs 
experiencing more than 150 percent growth. Rotary wing programs have 
also experienced high amounts of growth in procurement unit cost. As 
an example, both the H-1 Upgrades and CH-47F Improved Cargo Helicopter 
have each experienced more than 150 percent growth in their average 
procurement unit cost since first full estimates. Satellite programs 
show above average growth in development cost, procurement unit cost, 
and schedule growth since first full estimates when compared to the 
portfolio as a whole. For example, Wideband Global SATCOM and Space 
Based Infrared System (SIBRS) High, have each experienced more than 
100 percent growth in their development costs while another satellite 
program, the Advanced Extremely High Frequency (AEHF) Satellite, has 
experienced almost 200 percent growth in its average procurement unit 
cost. Three satellite programs have also experienced schedule growth 
well above the portfolio average of 36 percent with each of them 
reporting delays of 4 years or more. Unmanned vehicles have also 
experienced greater than average schedule delays with three of six 
unmanned vehicle programs reporting delays of 3 years or more. 

8. DOD has already been appropriated more than $833 billion for the 
current portfolio, leaving approximately $682 billion in costs to be 
funded, mostly for procurement. Approximately 45 percent of the 
remaining cost represents growth from first full estimates. Almost two-
thirds of the future funding is needed for 10 programs, with 35 
percent of the total costs remaining required for the F-35 program 
alone. A larger share of the current portfolio cost is now 
appropriated than it was 10 or even 5 years ago. Fifty-five percent of 
the costs for the 2013 portfolio have already been appropriated, more 
than $200 billion more than in the 2004 portfolio. Forty-five percent 
of the total cost of the current portfolio--or $682 billion--has not 
yet been funded and almost 94 percent of the remaining funding--or 
$638 billion--is needed for procurement. 

Approximately 45 percent--or $311.6 billion--of that future funding is 
needed to cover cost growth from first full estimates for programs in 
the current portfolio. These funds represent resources that will not 
be available to support other defense or government priorities. We 
recognize that for some programs a portion of this cost growth from 
first full estimates may be attributable to a quantity increase. For 
example, the $14 billion in future funding needed for the DDG 51 
Arleigh Burke Class Guided Missile Destroyer (DDG 51) is a result of 
quantity increases and the program has realized a significant decrease 
in its average procurement unit cost from first full estimates. 
However, in our assessments since 2011 we have found that a 
substantial amount of the change in the portfolio's total procurement 
cost could be attributable to factors other than quantity change such 
as production problems, inefficiencies, or flawed initial cost 
estimates. For example, the F-35 program requires $107 billion in 
future funding to cover cost growth, even though it will procure 409 
fewer aircraft than originally planned. Two-thirds of all remaining 
funding--or $463 billion--is required by the 10 programs with the 
highest future funding needs and F-35 alone requires about one-third 
of all funding to go. The other 70 programs have only $218.8 billion 
in costs remaining, less than the amount of future funding needed for 
the F-35 program. Table 6 shows the amount of future funding needed as 
well as how much of that funding represents cost growth from first 
full estimates. 

Table 6: Future Funding and Future Funding Required Due to Cost Growth 
from First Full Estimates: 

Fiscal year 2014 dollars in billions: 

Program name: F-35 Joint Strike Fighter; 
Future funding required: $239.6; 
Amount of future funding due to cost growth from first full estimates: 
$107.0. 

Program name: Evolved Expendable Launch Vehicle; 
Future funding required: $42.9; 
Amount of future funding due to cost growth from first full estimates: 
$38.4. 

Program name: KC-46 Tanker; 
Future funding required: $40.8; 
Amount of future funding due to cost growth from first full estimates: 
$0. 

Program name: Virginia Class Submarine; 
Future funding required: $28.2; 
Amount of future funding due to cost growth from first full estimates: 
$16.2. 

Program name: Joint Light Tactical Vehicle; 
Future funding required: $23.0; 
Amount of future funding due to cost growth from first full estimates: 
$0. 

Program name: CH-53K Super Stallion; 
Future funding required: $20.7; 
Amount of future funding due to cost growth from first full estimates: 
$7.4. 

Program name: Littoral Combat Ship; 
Future funding required: $19.6; 
Amount of future funding due to cost growth from first full estimates: 
$19.6. 

Program name: CVN 78 Gerald R. Ford Class Aircraft Carrier; 
Future funding required: $17.5; 
Amount of future funding due to cost growth from first full estimates: 
$0. 

Program name: P-8A Poseidon; 
Future funding required: $16.8; 
Amount of future funding due to cost growth from first full estimates: 
$1.7. 

Program name: DDG 51 Arleigh Burke Class Destroyer; 
Future funding required: $14.0; 
Amount of future funding due to cost growth from first full estimates: 
$14.0. 

10 programs with the largest future funding requirements: 
Future funding required: $463.2; 
Amount of future funding due to cost growth from first full estimates: 
$204.3. 

Totals for rest of portfolio: 
Future funding required: $218.8; 
Amount of future funding due to cost growth from first full estimates: 
$107.3. 

2013 portfolio total: 
Future funding required: $682.0; 
Amount of future funding due to cost growth from first full estimates: 
$311.6. 

Source: GAO analysis of DOD data. 

Notes: Future funding is measured as all fiscal year 2014 funding to 
completion of procurement. Some numbers may not sum due to rounding. 

[End of table] 

Observations from Our Assessment of Knowledge Attained by Programs at 
Key Acquisition Junctures: 

Our 2014 assessment shows that DOD continues to show progress in 
following a knowledge-based approach to reduce risk; however, it has 
significant room for improvement. While programs that have recently 
passed through major decision points have demonstrated best practices--
such as constraining development times and achieving design stability--
key practices like demonstrating technology maturity or controlling 
manufacturing processes are still not being fully implemented. As a 
result, many programs will carry risk into subsequent phases of 
acquisition that could result in cost growth or schedule delays. 

Positive acquisition outcomes require the use of a knowledge-based 
approach to product development that demonstrates high levels of 
knowledge before significant commitments are made. In essence, 
knowledge supplants risk over time. In our past work examining weapon 
acquisition and best practices for product development, we have found 
that leading commercial firms and successful DOD programs pursue an 
acquisition approach that is anchored in knowledge, whereby high 
levels of product knowledge are demonstrated at critical points in the 
acquisition process. This work led to multiple recommendations that 
DOD generally or partially agreed with and has made progress in 
implementing.[Footnote 9] On the basis of this work, we have 
identified three key knowledge points during the acquisition cycle--
development start, the system-level critical design review, and 
production start--at which programs need to demonstrate critical 
levels of knowledge to proceed. Figure 5 aligns the acquisition 
milestones described in DOD's primary acquisition policy with these 
knowledge points. In this report, we refer to DOD's engineering and 
manufacturing development phase as system development. Production 
start typically refers to a program's entry into low-rate initial 
production. 

Figure 5: DOD's Acquisition Cycle and GAO Knowledge Points: 

[Refer to PDF for image: illustration] 

Technology Development: 
DOD acquisition milestones: Development start (Milestone B); 
GAO knowledge points: Knowledge point 1: Technologies and resources 
match requirements. 

System development: 

Integration: 
DOD acquisition milestones: 
GAO knowledge points: Knowledge point 2: Design performs as expected. 

Demonstration: 
DOD acquisition milestones: Production start (Milestone C); 
GAO knowledge points: 

Production: 
DOD acquisition milestones: 
GAO knowledge points: Knowledge point 3: Production can meet cost, 
schedule, and quality targets. 

Source: GAO. 

[End of figure] 

The building of knowledge consists of information that should be 
gathered at these three critical points over the course of a program: 

Knowledge point 1: Resources and requirements match. Achieving a high 
level of technology maturity by the start of system development is one 
of several important indicators of whether this match has been made. 
This means that the technologies needed to meet essential product 
requirements have been demonstrated to work in their intended 
environment. In addition, the developer should complete a series of 
systems engineering reviews culminating in a preliminary design of the 
product that shows the design is feasible. Constraining the 
development phase of a program to 5 to 6 years is also recommended 
because it aligns with DOD's budget planning process and fosters the 
negotiation of trade-offs in requirements and technologies. For 
shipbuilding programs, critical technologies should be matured into 
actual system prototypes and successfully demonstrated in a realistic 
environment before a contract is awarded for detail design of a new 
ship. 

Knowledge point 2: Product design is stable. This point occurs when a 
program determines that a product's design will meet customer 
requirements, as well as cost, schedule, and reliability targets. A 
best practice is to achieve design stability at the system-level 
critical design review, usually held midway through system 
development. Completion of at least 90 percent of engineering drawings 
at this point provides tangible evidence that the product's design is 
stable, and a prototype demonstration shows that the design is capable 
of meeting performance requirements. Shipbuilding programs should 
demonstrate design stability by completing 100 percent of the basic 
and functional drawings as well as the three-dimensional product model 
by the start of construction for a new ship. Programs can also improve 
the stability of their design by conducting reliability growth testing 
and completing failure modes and effects analyses so fixes can be 
incorporated before production begins. At this point, programs should 
also begin preparing for production by identifying manufacturing 
risks, key product characteristics, and critical manufacturing 
processes. 

Knowledge point 3: Manufacturing processes are mature. This point is 
achieved when it has been demonstrated that the developer can 
manufacture the product within cost, schedule, and quality targets. A 
best practice is to ensure that all critical manufacturing processes 
are in statistical control--that is, they are repeatable, sustainable, 
and capable of consistently producing parts within the product's 
quality tolerances and standards--at the start of production. 
Demonstrating critical processes on a pilot production line is an 
important initial step in this effort. In addition, production and 
postproduction costs are minimized when a fully integrated, capable 
prototype is demonstrated to show that the system will work as 
intended in a reliable manner before committing to production. We did 
not assess shipbuilding programs for this knowledge point due to 
differences in the production processes used to build ships. 

Knowledge in these three areas builds over time. A knowledge deficit 
early in a program can cascade through design and production leaving 
decision makers with less knowledge to support decisions about when 
and how best to move into subsequent acquisition phases that commit 
more budgetary resources. Demonstrating technology maturity is a 
prerequisite for moving forward into system development, during which 
the focus should be on design and integration. A stable and mature 
design is likewise a prerequisite for moving forward into production 
where the focus should be on efficient manufacturing. Additional 
details about key practices at each of the knowledge points can be 
found in appendix IV. 

For this report, we assessed the knowledge attained by key junctures 
in the acquisition process for 38 current weapon programs, which are 
mostly in development or early production.[Footnote 10] Not all 
programs included in our review of knowledge-based practices provided 
information for every knowledge point or had reached all of the 
knowledge points--development start, design review, and production 
start--at the time of this review. 

Our analysis of data from these 38 major defense acquisition programs 
allows us to make three observations. 

Text Point Observations: 

Knowledge Point Observations: 

1. The two programs that began system development in 2013--F-22 
Increment 3.2B and Air and Missile Defense Radar--did not demonstrate 
all their critical technologies in a realistic environment and one of 
the two did not complete all relevant systems engineering reviews as 
it failed to hold a preliminary design review prior to system 
development. Both programs, however, intend to constrain their 
development phase to 6 years or less. This is consistent with the 
majority of the portfolio. Of the other programs we assessed, only 4 
matured their technologies and 8 completed preliminary design review 
in time for system development, but 19 planned for a constrained 
development phase. 

2. Of the three programs that held critical design reviews in 2013--KC-
46 Tanker, Joint Light Tactical Vehicle, and Warfighter Information 
Network -Tactical Increment 3--two demonstrated design stability by 
releasing 90 percent of planned engineering drawings and all three 
satisfied some of the best practices related to preparation for 
production; but none tested an early system-level integrated prototype 
or demonstrated all program critical technologies in a realistic 
environment prior to design review. For the other programs we assessed 
that reported information on this review, only 6 fully matured their 
designs and 3 tested system-level prototypes by the time this review 
was held. Significant numbers had conducted activities to plan for 
production. 

3. The two programs that held production decisions since our last 
assessment--Paladin Integrated Management and Ground/Air Task Oriented 
Radar--reported mature technologies and stable designs. Only one 
demonstrated performance through the testing of a production-
representative prototype. Consistent with our prior assessments, 
neither program has demonstrated that all their critical manufacturing 
processes are in statistical control, and only one program used a 
pilot production line before beginning production. Few of the other 
programs in our assessment that held production decisions implemented 
these practices; 3 had critical processes in control and 6 had used a 
pilot production line. 

Additional detail about these observations follows. 

1. The two programs that began system development in 2013 completed 
two systems engineering reviews before beginning development and plan 
to constrain their development phase, but one program did not carry 
out a preliminary design review, and neither demonstrated all its 
critical technologies in a realistic environment. Both the F-22 
Increment 3.2B and the Air and Missile Defense Radar (AMDR) programs 
entered system development with critical technologies nearing 
maturity--that is, demonstrated in a relevant environment--in 
accordance with DOD policy and statutory requirements.[Footnote 11] 
Knowledge-based acquisition practices, however, recommend that 
programs fully mature technologies and demonstrate them in a realistic 
or operational environment prior to entering system development. 
Achieving this higher level of technology maturity is a better 
indicator of whether a program has achieved a resource and 
requirements match with the attainment of additional knowledge about 
the technologies' form, fit, and function, as well as the effect of 
the intended environment on those technologies.[Footnote 12] Neither 
the F-22 Increment 3.2B nor the AMDR programs satisfied this best 
practice and the lower maturity level attained by these programs is 
consistent with our observations in past assessments on programs 
entering system development. Figure 6 shows the extent to which 
recommended acquisition practices for knowledge point 1 have been 
implemented on F-22 Increment 3.2B and AMDR as well as the other 36 
programs we assessed. 

Figure 6: Implementation of Knowledge-Based Practices for Programs in 
System Development: 

[Refer to PDF for image: illustrated table] 

Knowledge-based practices at development start: Demonstrate all 
critical technologies in a relevant environment; 
F-22 Inc 3.2 B: Practice implemented; 
AMDR: Practice implemented; 
Other 36 programs: 
Practice implemented: 15; 
Practice not implemented: 11; 
Practice not applicable or information not available per the program 
office response: 10. 

Knowledge-based practices at development start: Demonstrate all 
critical technologies in a realistic environment; 
F-22 Inc 3.2 B: Practice not implemented; 
AMDR: Practice not implemented; 
Other 36 programs: 
Practice implemented: 4; 
Practice not implemented: 22; 
Practice not applicable or information not available per the program 
office response: 10. 

Knowledge-based practices at development start: Complete system 
functional review and system requirements review before development 
start; 
F-22 Inc 3.2 B: Practice implemented; 
AMDR: Practice implemented; 
Other 36 programs: 
Practice implemented: 10; 
Practice not implemented: 25; 
Practice not applicable or information not available per the program 
office response: 1. 

Knowledge-based practices at development start: Complete preliminary 
design review before development start; 
F-22 Inc 3.2 B: Practice implemented; 
AMDR: Practice not implemented; 
Other 36 programs: 
Practice implemented: 8; 
Practice not implemented: 22; 
Practice not applicable or information not available per the program 
office response: 6 

Knowledge-based practices at development start: Constrain development 
phase to 6 years or less; 
F-22 Inc 3.2 B: Practice implemented; 
AMDR: Practice implemented; 
Other 36 programs: 
Practice implemented: 19; 
Practice not implemented: 4; 
Practice not applicable or information not available per the program 
office response: 13. 

Source: GAO analysis of DOD data. 

[End of figure] 

Of the remaining 36 current programs we assessed, only 4--Excalibur 
Precision 155mm Projectiles (Increment 1b), Global Positioning System 
III, LHA 6 America Class Amphibious Assault Ship, and Ship-to-Shore 
Connector--reported that all their critical technologies were matured 
to best practice standards when they began development.[Footnote 13] 
Another 11 programs we assessed reported having all critical 
technologies nearing maturity prior to system development. The 
remaining 21 programs reported either having one or more immature 
technologies at the start of development or reported no information on 
technology maturity at this critical point in the acquisition process. 
Of the 15 programs that had reported their critical technologies as at 
least nearing maturity at development start, 9 have thus far 
constrained research and development cost growth to 15 percent or less 
since first full estimate. In contrast, for the 11 programs reporting 
one or more immature critical technologies at development start, only 
2 successfully constrained research and development cost growth to 15 
percent or less since their first full estimate. 

Knowledge-based acquisition best practices recommend and statute 
requires that programs hold systems engineering events, such as a 
preliminary design review, before the start of development to ensure 
that requirements are defined and feasible and that the proposed 
design can meet those requirements within cost, schedule, and other 
system constraints. The Weapon Systems Acquisition Reform Act (WSARA) 
of 2009 made it a statutory requirement that major defense acquisition 
programs generally hold a preliminary design review before the start 
of system development.[Footnote 14] According to the program offices, 
the F-22 Increment 3.2B program conducted a preliminary design review 
prior to entering system development, but the AMDR program did not, 
and instead sought and received a waiver to this requirement. 
Currently, AMDR plans to conduct a preliminary design review in June 
2014. Of the remaining 36 current programs we assessed, only 8 held a 
preliminary design review prior to development start, including 4 
programs that began development start before 2009, and another 4 
programs that started development after implementation of WSARA. Our 
analysis of the current portfolio shows that programs that conducted a 
preliminary design review prior to development start have, on average, 
experienced a lower rate of research and development cost growth and a 
lower rate of total acquisition cost growth, compared with programs 
that did not have a preliminary design review before development 
start. Of the eight assessed programs that held this review prior to 
development start, six have thus far constrained research and 
development cost growth to less than 15 percent since first full 
estimate. Of the 22 assessed programs that did not carry out a 
preliminary design review prior to development start, only 8 were 
successful in restraining development cost growth below 15 percent. 

In addition to the preliminary design review, knowledge-based 
acquisition best practices recommend the completion of two additional 
systems engineering reviews: one review to ensure that system 
requirements have been properly identified, which helps ensure mutual 
understanding between government and contractor; and a system 
functional review to establish a functional baseline for the system. 
Both the F-22 Increment 3.2B and AMDR programs completed these reviews 
prior to entering system development. Of the remaining 36 programs we 
assessed, only 10 completed both reviews prior to development start--
five that entered system development before 2009 and another 5 that 
began system development after 2009. 

Knowledge-based acquisition practices also recommend that a program 
constrain the development phase to just 5 or 6 years, and both the F-
22 Increment 3.2B and AMDR programs plan to do so.[Footnote 15] By 
limiting development time in this manner, a program increases the 
predictability of funding needs, as well as the likelihood of program 
success by fostering the negotiation of trade-offs in requirements and 
technologies.[Footnote 16] For the remaining 31 non-ship programs we 
assessed, 19 had plans to limit their development phases to 6 years or 
less at the time of development start. This includes 13 out of 23 
programs that began development prior to 2009 and another 6 out of 8 
programs that began system development during or after 2009. 

As part of our analysis, we also assessed 18 future programs that 
expect to become major defense acquisition programs. These programs 
provided information on the knowledge they planned to obtain and best 
practices they intend to implement before their development start is 
approved. Seven of 18 future programs reported that their technologies 
are expected to be nearing maturity; that is demonstrated in a 
relevant environment, at the time of development start. Ten of the 
future programs plan to hold a preliminary design review before the 
start of development and only seven plan to conduct both a system 
functional and system requirements review before the start of 
development. Nine of the future programs reported plans to limit the 
program development phase to 6 years or less. If these plans continue 
unaltered, programs will enter system development with insufficient 
knowledge about their ability to meet cost, schedule, and performance 
requirements. The decision to proceed without this knowledge involves 
more than the program at hand, it sends signals across the portfolio 
of programs on what is acceptable. If programs that do not abide by 
sound acquisition principles win funding, then seeds of poor outcomes 
are planted. Top decision makers must ensure that new programs exhibit 
desirable principles before they are approved and funded; the proper 
time to establish that is at program start. 

2. Of the three programs that held critical design reviews in 2013, 
two demonstrated design stability by releasing 90 percent of expected 
engineering drawings, but none tested an early integrated prototype or 
demonstrated all critical technologies in a realistic environment 
prior to this design review. Knowing a product's design is stable 
before system demonstration reduces the risk of costly design changes 
as manufacturing begins and investments in acquisition become more 
significant. Just as programs that enter system development with 
immature technologies cost more and take longer to deliver their 
operational capabilities to the warfighter, programs that hold their 
critical design review before achieving a stable design also 
experience higher average costs and longer schedule delays. Figure 7 
presents whether the programs implemented this, as well as other, best 
practices. 

Figure 7: Implementation of Knowledge-Based Practices for Programs at 
Critical Design Review: 

[Refer to PDF for image: illustrated table] 

Knowledge-based practices at critical design review: Demonstrate all 
critical technologies in a realistic environment; 
JLTC: Practice not implemented; 
KC-46: Practice not implemented; 
WIN-T-INC 3: Practice not implemented; 
Other 30 programs: 
Practice implemented: 6; 
Practice not implemented: 18; 
Practice not applicable or information not available per the program 
office response: 6. 

Knowledge-based practices at critical design review: Release at least 
90 percent of drawings or 100 percent of 3D zones; 
JLTC: Practice implemented; 
KC-46: Practice implemented; 
WIN-T-INC 3: Practice not applicable or information not available per 
the program office response; 
Other 30 programs: 
Practice implemented: 6; 
Practice not implemented: 18; 
Practice not applicable or information not available per the program 
office response: 6. 

Knowledge-based practices at critical design review: Test a system-
level integrated prototype; 
JLTC: Practice not implemented; 
KC-46: Practice not implemented; 
WIN-T-INC 3: Practice not implemented; 
Other 30 programs: 
Practice implemented: 3; 
Practice not implemented: 18; 
Practice not applicable or information not available per the program 
office response: 9. 

Knowledge-based practices at critical design review: Establish a 
reliability growth curve; 
JLTC: Practice implemented; 
KC-46: Practice implemented; 
WIN-T-INC 3: Practice implemented; 
Other 30 programs: 
Practice implemented: 14; 
Practice not implemented: 12; 
Practice not applicable or information not available per the program 
office response: 4. 

Knowledge-based practices at critical design review: Identify key 
product characteristics; 
JLTC: Practice implemented; 
KC-46: Practice implemented; 
WIN-T-INC 3: Practice implemented; 
Other 30 programs: 
Practice implemented: 26; 
Practice not implemented: 1; 
Practice not applicable or information not available per the program 
office response: 3. 

Knowledge-based practices at critical design review: Identify critical 
manufacturing processes; 
JLTC: Practice not implemented; 
KC-46: Practice implemented; 
WIN-T-INC 3: Practice implemented; 
Other 30 programs: 
Practice implemented: 21; 
Practice not implemented: 3; 
Practice not applicable or information not available per the program 
office response: 6. 

Knowledge-based practices at critical design review: Conduct 
producibility assessments to identify manufacturing risks for key 
technologies; 
JLTC: Practice implemented; 
KC-46: Practice implemented; 
WIN-T-INC 3: Practice not applicable or information not available per 
the program office response; 
Other 30 programs: 
Practice implemented: 23; 
Practice not implemented: 3; 
Practice not applicable or information not available per the program 
office response: 4. 

Knowledge-based practices at critical design review: Complete failure 
modes and effects analysis; 
JLTC: Practice implemented; 
KC-46: Practice implemented; 
WIN-T-INC 3: Practice not applicable or information not available per 
the program office response; 
Other 30 programs: 
Practice implemented: 21; 
Practice not implemented: 4; 
Practice not applicable or information not available per the program 
office response: 5. 

Source: GAO analysis of DOD data. 

[End of figure] 

Of the three programs that held their critical design review in 2013, 
both the KC-46 Tanker and the Joint Light Tactical Vehicle (JLTV) 
demonstrated design stability by releasing over 90 percent of each 
program's expected design drawings.[Footnote 17] According to the 
Warfighter Integration Network-Tactical Increment 3 (WIN-T Inc 3) 
program office this practice was not applicable as the system relies 
primarily on software for its functionality.[Footnote 18] Of the 
remaining programs we assessed, 30 reported information about the 
practices they implemented at their critical design review. Of these, 
only 6 non-ship programs released at least 90 percent of their total 
expected design drawings before holding this review, and no 
shipbuilding programs met the shipbuilding-specific best practice of 
completing 100 percent of their three-dimensional design models prior 
to the start of fabrication. All 6 of the programs with a stable 
design held their critical design review since 2009. 

The use of early system prototypes during development is another 
useful practice for demonstrating that a system has a stable design, 
will work as intended, and can be built within cost and schedule. None 
of the three programs reported testing an integrated system prototype 
before their critical design review or its equivalent. Instead, the 
JLTV program reported conducting this system prototype testing 7 
months after its design review, and the KC-46 Tanker program will not 
begin flight testing a system-level prototype that integrates the 
civilian aircraft and military sub-systems until January 2015, 18 
months after its critical design review. WIN-T Inc 3 did not plan to 
test a system-level prototype until October 2015, 22 months after its 
critical design review. Of the 25 non-ship programs we assessed that 
have held a critical design review, 21 report they tested or plan to 
test an early integrated prototype but only 3 programs conducted this 
testing before their critical design review.[Footnote 19] For the 
other 18 programs, prototype testing followed the review by an average 
of nearly 3 years (or 33 months). This use of early system prototypes 
among programs we assessed is much the same as past assessments. 

Reliability growth testing provides visibility over how reliability is 
improving and uncovers design problems so fixes can be incorporated 
before production begins. All three programs reported establishing a 
reliability growth curve by their critical design review. Of the 
remaining 30 programs we assessed that have held critical design 
review, or its equivalent, 14 had a reliability growth curve at that 
time. 

The programs we assessed also reported use of other knowledge-based 
practices to increase confidence in the stability of their product's 
design. Those practices include the identifying key product 
characteristics; identifying critical manufacturing processes; 
conducting producibility assessments to identify manufacturing risks; 
and completing failure modes and effects analysis to identify 
potential failures and early design fixes. The KC-46 Tanker program 
carried out all four of these practices, while the JLTV program 
carried out three and the WIN-T Inc 3 program implemented two. For the 
30 other programs we assessed with a critical design review prior to 
2013, a little more than half of them reported having used all four of 
these practices. This rate of implementation is similar to what we 
observed in our prior year assessment. 

3. The two programs that held production decisions since our last 
assessment reported mature technologies and stable designs, and one of 
the two demonstrated performance through the testing of a production-
representative prototype; neither demonstrated that all their 
manufacturing process capabilities were in control. Capturing critical 
manufacturing knowledge before entering production helps ensure that a 
weapon system will work as intended and can be manufactured 
efficiently to meet cost, schedule, and quality targets. This 
knowledge can be captured and demonstrated through the use of various 
proactive methods, including the use of statistical process control 
data, pilot production lines, Manufacturing Readiness Levels, and 
prototype testing. Figure 8 shows the extent to which programs that 
have held a production decision have implemented associated knowledge-
based practices. 

Figure 8: Implementation of Knowledge-Based Practices for Programs at 
Production Decision: 

[Refer to PDF for image: illustrated table] 

Knowledge-based practices at production start: Demonstrate all 
critical technologies in a realistic environment; 
PIM: Practice implemented
G/ATOR: Practice implemented
Other 16 programs: 
Practice implemented: 8
Practice not implemented: 4
Practice not applicable or information not available per the program 
office response: 4. 

Knowledge-based practices at production start: Release at least 90 
percent of drawings; 
PIM: Practice implemented; 
G/ATOR: Practice implemented; 
Other 16 programs: 
Practice implemented: 6; 
Practice not implemented: 5; 
Practice not applicable or information not available per the program 
office response: 5. 

Knowledge-based practices at production start: Demonstrate 
manufacturing process capabilities are in control; 
PIM: Practice not implemented; 
G/ATOR: Practice not implemented; 
Other 16 programs: 
Practice implemented: 3; 
Practice not implemented: 7; 
Practice not applicable or information not available per the program 
office response: 6. 

Knowledge-based practices at production start: Demonstrate critical 
processes on a pilot production line; 
PIM: Practice not implemented; 
G/ATOR: Practice implemented; 
Other 16 programs: 
Practice implemented: 6; 
Practice not implemented: 4; 
Practice not applicable or information not available per the program 
office response: 6. 

Knowledge-based practices at production start: Test a production-
representative prototype in its intended environment; 
PIM: Practice not implemented; 
G/ATOR: Practice implemented; 
Other 16 programs: 
Practice implemented: 6; 
Practice not implemented: 5; 
Practice not applicable or information not available per the program 
office response: 5. 

Source: GAO analysis of DOD data. 

[End of figure] 

Neither the Paladin Integrated Management (PIM) program, which held a 
production decision in 2013, nor the G/ATOR program, which held a 
production decision in January 2014, demonstrated that their 
manufacturing process capabilities were in control at production 
start.[Footnote 20] Of the remaining programs we assessed, 16 non-ship 
programs held production decisions prior to 2013, of which only 3 
provided data indicating that critical manufacturing processes were in 
control at production start.[Footnote 21] Though the PIM program did 
not test a pilot production line prior to production start, the G/ATOR 
program reported that it has. Of the 16 programs that held production 
decisions prior to 2013, only 6 have demonstrated manufacturing 
processes on a pilot production line. Another 14 programs we assessed 
plan to hold a production decision in the future and only 6 indicated 
that they intend to test a pilot production line before production 
start. 

Production and postproduction costs are also minimized when a fully 
integrated, production-representative prototype is demonstrated to 
show that the system will work as intended in a reliable manner. DOD 
policy has also required that a system be demonstrated in its intended 
environment using a production-representative article before entering 
production, which has led to an increase in the number of programs 
doing so.[Footnote 22] The G/ATOR program has tested a production-
representative prototype in its intended environment in advance of 
their production decision, but PIM has not. Of the 16 programs we 
assessed that held a production decision prior to 2013, only 6 tested 
production-representative prototypes prior to their production start. 
For the other 14 programs we assessed that plan to hold a production 
decision in the future, only 5 currently have plans to test a 
production-representative prototype before reaching this key juncture. 
In not testing such prototypes these programs risk repeating the 
experiences of the past when issues were discovered late in testing, 
triggering the need for expensive re-tooling of production lines and 
retrofitting of production articles. 

Observations about DOD's Implementation of Key Acquisition Reform 
Initiatives and Program Concurrency: 

During the past few years, the Congress and DOD have made policy 
changes and begun other reform initiatives to improve the way the 
department acquires major weapon systems and address the symptoms of 
an acquisition system that include frequent program cost overruns and 
delays in operational capability delivery. More specifically, the 
enactment of the Weapon Systems Acquisition Reform Act of 2009, the 
promulgation of multiple "Better Buying Power" memorandums by the 
Under Secretary of Defense for Acquisition, Technology, and Logistics, 
and the revision of DOD Instruction 5000.02 in 2008 and interim 
revision in 2013, represent efforts to increase competition in weapon 
programs, decrease acquisition costs, and ensure that programs are 
more affordable.[Footnote 23] We focused our analysis on efforts 
within the "Better Buying Power" memorandums, particularly 
affordability constraints and "should-cost" analysis. These efforts 
attempt to control program costs by introducing, respectively, 
constraints on total cost and a review process to eliminate 
unnecessary costs from contracts. We also analyzed the implementation 
of two reforms addressed in legislation, the requirement to increase 
competition throughout the acquisition life cycle and the requirement 
that major defense acquisition programs hold annual configuration 
steering board reviews to consider changes regarding program 
requirements and maximize capabilities. GAO has previously made 
recommendations or observations on the implementation of a number of 
these reform initiatives and DOD, which has generally concurred or 
partially concurred with the recommendations, is working to implement 
them.[Footnote 24] In addition, we evaluated the amount of concurrency 
between developmental testing and production for programs we assessed 
that have started production as well as those that plan to begin 
production in the coming years.[Footnote 25] We have consistently 
emphasized the importance of completing developmental testing before 
entering production, and pointed out the increased risks associated 
with concurrent testing and production.[Footnote 26] 

To gain some perspectives on the implementation of key aspects of 
policy changes and reform initiatives within DOD's current portfolio, 
we analyzed questionnaire data collected from 38 current major defense 
acquisition programs--the same programs reflected in our knowledge 
point analysis--and 18 additional programs identified by DOD as future 
major defense acquisition programs. 

Implementation of the reform initiatives we analyzed varies across 
programs. The department has largely been successful in implementing 
its "should-cost" initiative with significant cost savings being 
reported. In addition, many programs reported holding configuration 
steering board reviews. In contrast, the department has had less 
success in implementing affordability constraints and utilizing 
measures to ensure competition before and after development start--
initiatives that also have the potential to result in savings. In 
addition, many programs are committing to production prior to 
completing the developmental testing necessary to assure that the 
system will function as intended, introducing unnecessary risk to cost 
and schedule. Our current analysis allows us to make the following 
five observations concerning key acquisition reform initiatives and 
program concurrency. 

Text box: 

Acquisition Reform and Concurrency Observations: 

1. Only 30 of the 56 current and future programs we assessed have 
established an affordability constraint, an implementation rate that 
has not improved from our prior year assessment, but all programs with 
a cap that we assessed reported they are on track to meet it. 

2. About 82 percent of the current programs we assessed have conducted 
a "should-cost" analysis resulting in anticipated savings of 
approximately $24 billion; over half of this amount has or will be 
reallocated from these programs for other priorities. 

3. Many of the future programs we assessed do not plan to conduct 
competitive prototyping before development start and many current 
programs do not have acquisition strategies that ensure competition 
through the end of production. Fifteen future and current programs 
reported they will not take actions to promote any competitive 
measures before or after development start. 

4. All but 1 of the 38 current programs we assessed had conducted a 
configuration steering board review with 29 programs reporting that 
this review occurred during the past year. Only 10 programs reported 
that changes were approved or recommended at their last review. 

5. Fifteen of the 18 current programs we assessed that have started 
production plan to perform 30 percent or more of their developmental 
testing during production despite the increased risk of design changes 
and costly retrofits. Five of these programs expect to place 
substantial procurement quantities under contract before developmental 
testing is completed. 

[End of text box] 

Additional details about each observation follow. 

1. Only 30 of the 56 current and future programs we assessed have 
established an affordability constraint, an implementation rate that 
has not improved from our prior year assessment, but all programs with 
a cap that we assessed reported they are on track to meet it. In 
September 2010, the first of several memorandums were issued by the 
Under Secretary of Defense for Acquisition, Technology, and Logistics 
directing programs to consider affordability a key program requirement 
and outlining how this initiative was to be implemented across the 
department.[Footnote 27] The memorandums emphasize the need to treat 
affordability, defined as conducting a program at a cost constrained 
by the resources that DOD can allocate, as a key requirement at the 
start of development. Affordability constraints are intended to force 
prioritization of requirements, enable cost trades and ensure that 
unaffordable programs do not enter the acquisition process.[Footnote 
28] More than half of the current and future programs (30 of 56) we 
assessed have established an affordability constraint as directed by 
the "Better Buying Power" initiatives and all these programs reported 
that they are on track to meet their established constraint. The rate 
of implementation of this reform has not improved from the level 
reported in our prior assessment. For the 38 current programs, 18 have 
not established an affordability cap and almost all of these programs 
are nearing a production decision or are already in production. In 
general, these 18 programs are older and have smaller percentages of 
funding remaining than those current programs with an affordability 
cap. Similarly, for the 18 future programs, 8 reported a lack of an 
established affordability goal. Two of them reported holding a 
milestone A review during 2013--where an affordability goal would 
normally be established--while a third program held its milestone A 
review in 2009 before the affordability requirement was established by 
DOD policy and the remaining 5 responded that the timeframe for this 
review was "to be determined" or "not applicable." 

2. About 82 percent of the current programs we assessed have conducted 
a "should-cost" analysis resulting in anticipated savings of 
approximately $24 billion; over half of this amount has or will be 
pulled from these programs for other priorities. DOD's Better Buying 
Power initiatives also emphasize the importance of driving cost 
improvements during contract negotiation and program execution to 
control costs both in the short-term and throughout the product life 
cycle. In accordance with direction provided in memorandums issued by 
the Under Secretary, each program must conduct a "should-cost" 
analysis which includes justifying each cost under the program's 
control with the aim of reducing negotiated prices for contracts and 
obtaining other efficiencies in program execution. More broadly, 
"should-cost" is the concept that program managers are to proactively 
control expenditures by setting cost targets below what has been 
budgeted for their program's activities and manage with the intent to 
achieve these lower targets. 

According to our analysis of questionnaire responses, 32 of 38 current 
programs we assessed conducted a "should-cost" analysis as directed by 
the Better Buying Power initiatives and 31 of the programs reported 
that they had realized or expect to realize cost savings totaling 
approximately $24 billion in fiscal year 2014 dollars as shown in 
figure 9 below.[Footnote 29] 

Figure 9: Realized and Expected "Should-Cost" Savings Reported by 31 
Programs: 

[Refer to PDF for image: horizontal bar graph] 

Fiscal year 2014 dollars: 

2 programs where all cost savings have been realized: 
Expected: 0; 
Realized: $0.6 billion. 

19 programs that have realized some cost savings and expect more: 
Expected: $10.6 billion; 
Realized: $9.3 billion. 

10 programs that expect all savings to be realized in the future: 
Expected: $3.5 billion; 
Realized: 0. 

Source: GAO analysis of questionnaire data. 

[End of figure] 

Approximately 41 percent, $9.9 billion, of all the "should-cost" 
savings were identified as realized, with the other 59 percent, or 
$14.1 billion, expected in the future. When savings were converted 
into fiscal year 2014 constant dollars, 6 of the programs reported 
savings of more than $1 billion, the largest of which was the KC-46 
Tanker program which reported a savings total of $6.8 billion with 
nearly $6.4 billion of this amount already realized. For the 6 current 
programs that reported they did not conduct a "should-cost" analysis, 
3 were being restructured during our assessment after reporting an 
increase in cost or schedule above their baselines, and another had 
recently entered system development. 

The 18 programs that reported some or all of their "should-cost" 
savings as realized cited several activities as being responsible 
including: 

* improved vendor/supply chain management (10 programs), 

* developmental or operational testing efficiencies (12 programs), and: 

* design trades conducted to balance affordability and capability (12 
programs). 

As a specific example, the DDG 51 program reported that nine different 
activities were carried out to obtain approximately $506 million in 
realized cost savings including the three activities above, while the 
JLTV program cited two activities--design trades balancing 
affordability and capability and changes in requirements--to achieve 
$206 million in realized cost savings with another $412 million in 
savings expected in the future. These savings may manifest themselves 
in the program by lower contract prices, lower program cost estimates, 
and possibly lower funding requests. 

Achieving efficiency needs to be done with caution as the short-term 
savings could come at the expense of long-term needs. For example, six 
of the programs that reported implementing testing efficiencies for 
savings are also planning to conduct concurrent developmental testing 
and production which leaves these programs at risk to deficiencies 
being discovered during production that could require substantial and 
costly modifications to systems already built. Similarly, four 
programs that started production before 2011 reported that changes in 
design or requirements will result in some savings, but carrying out 
this "should-cost" activity after production start could contribute to 
design instability. In addition, 7 programs stated that savings are 
being realized from the increased use of modeling and simulation but 
only 3 of these programs reported that all the models being used for 
operational and live fire testing were officially reviewed and 
certified as acceptable for their intended use. While the use of 
models and simulations can reduce the time and resources needed to 
conduct the required testing, using models that are not fully 
accredited to meet weapons system testing objectives increases the 
likelihood that an inappropriate or unsuitable simulation is being 
used. 

Of the approximately $24 billion in realized and anticipated "should-
cost" savings, a total of $12.6 billion was reallocated to meet other 
service and DOD priorities. For example, the KC-46 Tanker program 
reported that all of its "should-cost" savings, totaling $6.8 billion, 
will be reinvested in other service and Office of the Secretary of 
Defense priorities. Approximately $6.3 billion was reported as 
retained by 16 programs we assessed. While several other programs 
reported that their savings, a total of $3.6 billion, were split among 
different activities with some amounts retained and some reallocated 
for other priorities. For example, the F-35 program reported that some 
of the $884 million in expected savings will be put to use by the 
program while other amounts will be reinvested in other service and 
Office of the Secretary of Defense priorities. An additional $1.5 
billion in savings was reported as a part of our questionnaire but 
programs stated that they did not know or had not yet determined how 
these funds would be re-allocated. The concept of allowing programs to 
keep at least some of their savings is appropriate, but the department 
should take care to use this incentive effectively. 

Of the 18 future programs that we assessed, 6 reported that they 
conducted a "should-cost" analysis prior to entering system 
development which identified approximately $26 billion in realized and 
expected savings. The vast majority of this amount was reported by the 
Ohio Replacement and Ground Combat Vehicle (GCV) programs with $16 
billion and $8.5 billion, respectively, in "should-cost" savings. The 
Ohio Replacement program reported that all $16 billion in procurement 
and other savings were expected in the future and would result from 
several ongoing affordability initiatives including design for 
producibility initiatives and potentially procuring boats in a multi-
year procurement block buy with Virginia Class submarines. In 
contrast, the GCV program reported all its $8.5 billion in savings as 
realized. The program claims savings were due to design trades to 
balance affordability and capability and the award of a fixed-price 
development contract among other activities. The decision to eliminate 
competition during system development and production was reported as 
responsible for a decrease in the program's expected cost. 

3. Many of the future programs we assessed do not plan to conduct 
competitive prototyping before development start and many current 
programs do not have acquisition strategies that ensure competition 
through the end of production. Fifteen future and current programs 
reported they will not take actions to promote any competitive 
measures before or after development start. Competition is a critical 
tool for achieving the best return on the government's investment. 
Major defense acquisition programs are required to provide for the use 
of competitive prototypes before a program enters system development 
and have acquisition strategies that ensure competition or the option 
of competition throughout the acquisition life cycle.[Footnote 30] 
Table 7 shows the activities programs report using or plan to use to 
ensure competition or the possibility of competition. 

Table 7: Use of Activities to Ensure Competition Reported by Future 
and Current Programs: 

Activity to ensure competition is utilized[A]: Competitive prototyping 
prior to development start; 

Competitive prototyping planned or conducted; 
Of the 18 future programs: 9; 
Of the 38 current programs: 16. 

No competitive prototyping planned or conducted; 
Of the 18 future programs: 8; 
Of the 38 current programs: 22. 

Activity to ensure competition is utilized[A]: Measures to ensure 
competition after development start included in program strategy[B]; 

Measures to ensure competition are planned or have taken place; 
Of the 18 future programs: 8; 
Of the 38 current programs: 21. 

No measures included; 
Of the 18 future programs: 8; 
Of the 38 current programs: 17. 

Actions taken to promote competition both prior to and after 
development start; 
Of the 18 future programs: 5; 
Of the 38 current programs: 10. 

No actions taken to promote competition; 
Of the 18 future programs: 4; 
Of the 38 current programs: 11. 

Source: GAO analysis of questionnaire data. 

[A] One future program--the Amphibious Combat Vehicle--was not 
included in the totals above for competitive prototyping as it did not 
know whether such a competition would be conducted prior to 
development start. Two future programs--the Amphibious Combat Vehicle 
and Indirect Fire Protection Capability Increment 2-Intercept--were 
not counted in the totals for measures to ensure competition as they 
both did not yet know whether their technology development or 
acquisition strategies would call for competition between development 
start and the completion of production. 

[B] We use program strategy to refer to both technology development 
strategies used by future programs and the acquisition strategies used 
by current programs. 

[End of table] 

Only 25 of 56 current and future programs we assessed reported 
conducting or planning for any form of competitive prototyping prior 
to the start of system development. Of the 22 current programs with no 
competitive prototyping, only 2 reported that the requirement was 
waived pursuant to DOD policy implementing WSARA. The other 20 
programs that reported the competitive prototyping requirement was not 
waived either began development before December 2009, when WSARA was 
implemented, or proceeded directly to production. The future programs 
we assessed reported that they plan to conduct competitive prototyping 
at a slightly higher rate than the current programs we assessed. 
However, 8 future programs still reported that they do not intend to 
conduct competitive prototyping. Of these, 7 plan to seek a waiver to 
this requirement with the remaining one reporting that the requirement 
to seek a waiver was not applicable. 

Measures in a program's acquisition strategy to ensure competition or 
the option of competition after a program enters system development 
may include approaches such as the use of modular, open architectures 
to enable competition for upgrades or the use of build-to-print 
approaches to enable production through multiple sources.[Footnote 31] 
But as shown in table 7 above, only 29 of 56 current and future 
programs reported that their acquisition strategies currently include 
measures to ensure competition after the start of development. Twenty-
six of these programs stated that some or all of their activities to 
promote competition will take place in the future. 

Overall, only 10 current programs and 5 future programs have taken or 
plan to take actions to promote competition both before and after the 
start of the development. In contrast, 11 current programs and 4 
future programs reported that they have not taken any actions, nor do 
they plan to take any, to ensure competition or the option of 
competition for acquisition at any point after program initiation. 
This does not mean that these programs will have no competition at any 
point during their acquisition; only that they do not intend to ensure 
competition through the specific activities we assessed. 

4. All but one of the 38 current programs we assessed had conducted a 
Configuration Steering Board (CSB) review, 29 reported that this 
review occurred during the past year. Only 10 programs reported that 
proposed changes were approved or recommended at the most recent 
review. According to statute and DOD's acquisition policy at the time 
of our review, ongoing major defense acquisition programs are required 
to conduct annual configuration steering boards to review proposed 
changes to the program's requirements or significant technical 
configuration changes that may impact cost and schedule 
performance.[Footnote 32] Thirty-seven current programs we assessed 
had conducted such a review. The Air and Missile Defense Radar program 
was the only exception, as it just started development in October 2013 
and was not required to complete the review by the time of our 
assessment. A majority, 29 out of 37 programs, reported that this 
review occurred in the 12 months prior to the submission of our 
questionnaire. 

Only 12 of the current programs we assessed reported presenting any 
changes at their last CSB review. Of these, 10 programs had proposed 
requirements changes, configuration changes, descoping options, or 
some combination of these, which they reported were approved or 
recommended for approval. For example, the DDG 1000 Zumwalt Class 
Destroyer program reported that both configuration changes and 
descoping options were approved or recommended for approval at their 
June 2012 review, while the F-35 program reported that requirements 
changes were approved or recommended at their March 2013 review. 
However, some changes to capabilities have occurred outside of the CSB 
process. For the 38 current programs we assessed, 14 reported that 
planned system capabilities have either increased or decreased since 
the start of development. Only 5 of these programs indicated that a 
CSB review was one of the contributing reasons for the change. Many of 
these 14 programs reported that requirements changes since development 
start have caused cost and schedule changes as well. 

5. Fifteen of the 18 current programs we assessed that have started 
production plan to perform 30 percent or more of their developmental 
testing during production despite the increased risk of design changes 
and costly retrofits. Five of these programs expect to place 
substantial procurement quantities under contract before developmental 
testing is completed. Beginning production before demonstrating that a 
design is mature and that a system will work as intended increases the 
risk of discovering deficiencies during production that could require 
substantial design changes and costly modifications to systems already 
built. The intent of developmental testing is to demonstrate the 
maturity of a design and to discover and fix design and performance 
problems before a system enters production. However, 15 out of the 18 
programs we assessed that have started production intend to or have 
already executed 30 percent or more of their developmental testing 
concurrent with production. Seven of these 15 programs have completed 
developmental testing with 4 of them reporting quality problems during 
production. 

Five of the other 8 programs currently conducting concurrent testing 
and production, expect to have more than 10 percent of their 
procurement quantities under contract before developmental testing 
completes. The F-35 program in particular plans to have 530 aircraft, 
more than 20 percent of its total procurement quantity, under contract 
at a cost of approximately $57.8 billion before developmental testing 
is completed in 2017.[Footnote 33] When considering the point at which 
budgets to support those procurements are typically approved--up to 18 
months in advance--it places the commitment of funding that much 
further ahead of the completion of developmental testing. 

Another twelve programs we assessed are scheduled to make a production 
decision in the coming years and 6 of them intend to execute 30 
percent or more of their developmental testing concurrent with 
production. Two out of these six programs expect to have more than 10 
percent of their total procurement quantity under contract before 
developmental testing is finished running the risk of costly retrofits 
to existing systems or changes to active production lines. 

Assessments of Individual Programs: 

This section contains assessments of individual weapon programs. Each 
assessment presents data on the extent to which programs are following 
a knowledge-based acquisition approach to product development, and 
other program information. In total, we present information on 56 
programs. For 37 programs, we produced two-page assessments discussing 
the technology, design, and manufacturing knowledge obtained, as well 
as other program issues. Each two-page assessment also contains a 
comparison of total acquisition cost from the first full estimate for 
the program to the current estimate. The first full estimate is 
generally the cost estimate established at development start; however, 
for a few programs that did not have such an estimate, we used the 
estimate at production start instead. For shipbuilding programs, we 
used their planning estimates if those estimates were available. For 
programs that began as non-major defense acquisition programs, we used 
the first full estimate available. Thirty-four of these 37 two-page 
assessments are of major defense acquisition programs, most of which 
are in development or early production and 3 assessments are of 
programs that were projected to become major defense acquisition 
programs during or soon after our review. See figure 10 for an 
illustration of the layout of each two-page assessment. In addition, 
we produced one-page assessments on the current status of 19 programs, 
which include 15 future major defense acquisition programs, 2 major 
defense acquisition programs that are well into production, and 2 
major defense acquisition programs that were recently restructured or 
curtailed. 

Figure 10: Illustration of Program Two-Page Assessment: 

[Refer to PDF for image: illustration] 

Contents of assessment pages: 

A: Program description. 

B: Illustration or photo of system. 

C: Schedule timeline identifying key dates for the program including 
the start of development, major design reviews, production decisions, 
and planned operational capability. 

D: Program Essentials Programmatic information including the prime 
contractor, program office location, and funding needed to complete. 

E: Program Performance Cost and schedule baseline estimates and the 
latest estimate provided as of January 2014. 

F: Brief summary describing the program's implementation of knowledge-
based acquisition practices and its current status. 

G: Attainment of Product Knowledge Depiction of selected knowledge-
based practices and the program's progress in attaining that knowledge. 

H: Assessment of program's technology, design, and production 
maturity, as well as other program issues. 

I: Program Office Comments General comments provided by the cognizant 
program office. 

Source: GAO analysis. 

[End of figure] 

For our two-page assessments, we depict the extent of knowledge gained 
in a program by the time of our review with a scorecard and narrative 
summary at the bottom of the first page of each assessment. As 
illustrated in figure 10 above, the scorecard displays eight key 
knowledge-based acquisition practices that should be implemented by 
certain points in the acquisition process. The more knowledge the 
program has attained by each of these key points, the more likely the 
weapon system will be delivered within its estimated cost and 
schedule. A knowledge deficit means the program is proceeding without 
sufficient knowledge about its technologies, design, or manufacturing 
processes, and faces unresolved risks that could lead to cost 
increases and schedule delays. 

For each program, we identify a knowledge-based practice that has been 
implemented with a closed circle. We identify a knowledge-based 
practice that has not yet been implemented with an open circle. If the 
program did not provide us with enough information to make a 
determination, we show this with a dashed line. A knowledge-based 
practice that is not applicable to the program is grayed out. A 
knowledge-based practice may not be applicable to a particular program 
if either the point in the acquisition cycle when the practice should 
be implemented has not yet been reached, or if the particular practice 
is not relevant to the program. For programs that have not yet entered 
system development, we show a projection of knowledge attained for the 
first three practices. For programs that have entered system 
development but not yet held a critical design review, we assess 
actual knowledge attained for these three practices. For programs that 
have held a critical design review but not yet entered production, we 
assess knowledge attained for the first five practices. For programs 
that have entered production, we assess knowledge attained for all 
eight practices. 

We make adjustments to both the key points in the acquisition cycle 
and the applicable knowledge-based practices for shipbuilding 
programs. For shipbuilding programs that have not yet awarded a 
detailed design contract, we show a projection of knowledge attained 
for the first three practices. For shipbuilding programs that have 
awarded this contract but not yet started construction, we would 
assess actual knowledge attained for these three practices. For 
shipbuilding programs that have started construction, we assess the 
knowledge attained for the first four practices. We do not assess the 
remaining four practices for shipbuilding programs. See figure 11 for 
examples of the knowledge scorecards we use to assess these different 
types of programs. 

Figure 11: Examples of Knowledge Scorecards: 

[Refer to PDF for image: 2 illustrated tables] 

Source: GAO. 

[End of figure] 

Statement on Small Business Participation: 

As requested, we reviewed whether individual subcontracting reports 
from a program's prime contractor or contractors were accepted on the 
Electronic Subcontracting Reporting System (eSRS). We reviewed this 
information for 36 of the major defense acquisition programs in our 
assessment using the contract information reported in available 
Selected Acquisition Reports. The contract numbers for each program's 
or element's prime contracts were entered into the eSRS database to 
determine whether the individual subcontracting reports from the prime 
contractors had been accepted by the government. The government uses 
individual subcontracting reports on eSRS as one method of monitoring 
small business participation, as the report includes goals for small 
business subcontracting. Not all prime contracts for major defense 
acquisition programs are required to submit individual subcontracting 
reports. For example, some contractors report small business 
participation at a corporate level as opposed to a program level and 
this data is not captured in the individual subcontracting reports. 
Information gathered for this analysis is presented in appendix VI. 

[End of section] 

Program Assessments: 

AIM-9X Block II Air-to-Air Missile (AIM-9X Block II): 

[Illustration: Source: U.S. Navy] 

The AIM-9X Block II is a Navy-led program to acquire short-range air-
to-air missiles for the F-35, the Navy's F-18, and the Air Force's F-
15, F-16, and F-22A fighter aircraft. It is designed to detect, 
acquire, intercept and destroy a range of airborne threats. Block II 
includes hardware and software upgrades expected to improve the range 
from which the AIM-9X can engage targets, target discrimination, and 
interoperability. It was designated a major defense acquisition 
program in June 2011. 

Concept: 
Program start (2004). 

System development: 
Preliminary design review (3/07); 
Critical design review (9/07). 

Production: 
Low-rate decision (6/11); 
GAO review (1/14); 
Re-start operational test (TBD); 
Full-rate decision (TBD); 
Initial capability (TBD). 

Program Essentials: 
Prime contractor: Raytheon Missile Systems; 
Program office: Patuxent River, MD; 
Funding needed to complete: 
R&D: $113.2 million; 
Procurement: $4,167.0 million; 
Total funding: $4,280.2 million; 
Procurement quantity: 5,321; 

Program Performance (fiscal year 2014 dollars in millions) 

Research and development cost:
As of 12/2011: $178.8; 
Latest 09/2013: $224.5; 
Percent change: 25.6. 

Procurement cost:
As of 12/2011: $4,023.0; 
Latest 09/2013: $3,568.0; 
Percent change: -11.3. 

Total program cost:
As of 12/2011: $4,201.8; 
Latest 09/2013: $3,792.5; 
Percent change: -9.7%. 

Program unit cost:
As of 12/2011: $0.700; 
Latest 09/2013: $0.632; 
Percent change: -9.7%. 

Total quantities
As of 12/2011: 6,000; 
Latest 09/2013: 6,000; 
Percent change: 0.0. 

Acquisition cycle time (months) 
As of 12/2011: 39; 
Latest 09/2013: TBD; 
Percent change: TBD. 

The AIM-9X Block II entered production in June 2011 with mature 
critical technologies, a stable design, and production processes that 
had been demonstrated on a production line, but were not in control. 
In July 2013, the Navy suspended operational testing for the AIM-9X 
Block II due to two issues with missile performance. According to the 
program office, one issue has been resolved with a software fix. 
However, the root cause for the second issue, related to probability 
of kill, a key performance requirement, was still under investigation 
during our review. The program has stopped accepting missiles until 
the root cause analysis is complete and the program determines what, 
if any, fixes to those missiles may be needed. The program also 
expects to delay the full-rate production decision from April 2014 until
the second quarter of fiscal year 2015. 

Attainment of Product Knowledge: 

As of January 2014: 
Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge not 
attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
attained; 
* Test a production-representative prototype: Knowledge attained. 

AIM-9X Block II Program: 

Technology and Design Maturity: 

The AIM-9X Block II entered operational testing with its critical 
technologies mature and its design stable. The Block II began as a pre-
planned product improvement and various component development and 
integration efforts have been ongoing since 2004. According to the 
Navy's May 2011 technology readiness assessment, the Block II involves 
the integration of mature technologies, including a new active optical 
target detector/datalink, an upgraded electronics unit, and new 
operational flight software, among others. These hardware and software
upgrades are intended to improve the missile's two-way communication 
capabilities, its tracking and targeting, its range, and its accuracy. 
The program estimates that 85 percent of Block II components are 
unchanged from Block I. In July 2013, the Navy suspended operational 
testing due to missile performance deficiencies. The root causes of the
deficiencies are still under investigation. 

Production Maturity: 

The AIM-9X Block II began production in June 2011 with manufacturing 
processes that had been demonstrated on a pilot production line, but 
were not in control. Prior to its production decision, the program 
concluded that its manufacturing readiness was at the level 
recommended by DOD guidance, but not at a level that indicated that 
processes were in control. According to the program office, a 
production readiness review and manufacturing readiness assessment 
will occur prior to the full-rate production decision, which has been 
delayed while the program corrects deficiencies discovered in
operational testing. Officials expect that the missile's manufacturing 
processes will be in control prior to the full rate production 
decision. In the meantime, the AIM-9X prime contractor has met its
internal quality goal for defects per unit, another indicator of 
production maturity, for the last several months of 2013. 

Other Program Issues: 

The Navy suspended operational testing for the AIM-9X Block II in July 
2013 after the program discovered multiple deficiencies that negatively
affected missile performance. Officials report this will likely delay 
the full-rate production decision and initial operational capability 
to 2015. According to program officials, one of the two issues that 
led to the suspension of testing related to the missile's target 
acquisition time, has been addressed through a software change. 
However, the root cause of the second issue related to its probability 
of kill-—a key performance requirement—-is still under investigation. 
Once the root cause is identified, the program will test the 
corrections in developmental testing before returning to operational 
testing. According to program officials, they have stopped accepting 
missiles from the contractor pending the results of the analysis, but 
production continues. According to program officials, the AIM-9X Block 
II program removed 14 missiles from its fiscal year 2013 procurement 
plans as a result of sequestration reductions. The AIM-9X program 
plans to pursue a material development decision to initiate a Block III
acquisition program to further improve missile performance in 2014. 

Program Office Comments: 

According to program officials, the AIM-9X Block II program is 
exceeding warfighters' expectations in every way, specifically, in the 
areas of cost, schedule and performance. The AIM-9X Block II program 
discovered deficiencies during operational testing and has implemented 
manufacturing and software improvements that meet or exceed 
requirements. The program remains on schedule to meet initial 
operational capability threshold and deliver "game changing 
capability" in the Beyond Visual Range Air-to-Air Missile employment. 

[End of assessment] 

Air and Missile Defense Radar (AMDR): 

[Illustration: Source: U.S. Navy] 

The Navy's Air and Missile Defense Radar (AMDR) will be a next-
generation radar system designed to provide ballistic missile defense, 
air defense, and surface warfare capabilities. AMDR will consist of
an S-band radar for ballistic missile defense and air defense, X-band 
radar for horizon search, and a radar suite controller that controls 
and integrates the two radars. AMDR will initially support DDG 51
Flight III. The Navy expects AMDR to provide the foundation for a 
scalable radar architecture that can be used to defeat advanced 
threats. 

Concept: 
Program start (9/10). 

System development: 
Development start (10/13). 
GAO review (1/14); 
Preliminary design review (6/14); 
Critical design review (4/15); 
Production: 
Low-rate decision (9/17); 
Start operational test (7/23); 
Initial capability (11/23). 

Program Essentials: 
Prime contractor: Raytheon; 
Program office: Washington, DC; 
Funding needed to complete: 
R&D: $881.1 million; 
Procurement: $3,919.8 million; 
Total funding: $4,800.9 million; 
Procurement quantity: 22. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of: NA;
Latest 10/2013: $1,895.3;
Percent change: NA. 

Procurement cost: 
As of: NA;
Latest 10/2013: $3,919.8;
Percent change: NA. 

Total program cost: 
As of: NA;
Latest 10/2013: $5,844.4;
Percent change: NA. 

Program unit cost: 
As of: NA; 
Latest 10/2013: $265.655;
Percent change: NA. 

Total quantities: 
As of: NA; 
Latest 10/2013: 22;
Percent change: NA. 

Acquisition cycle time (months): 
As of: NA; 
Latest 10/2013: 158;
Percent change: NA. 

AMDR entered system development in October of 2013 with all four of 
its critical technologies approaching full maturity. This was 6 months 
later than planned, leading to a delay in many of the program's future 
events. These delays might impact the Navy's plan to design the DDG 51
Flight III, intended to carry the radar. The Navy and shipbuilders 
have determined that a 14-foot active radar is the largest that can be 
accommodated by the existing DDG 51 though AMDR is also being 
developed as a scalable design. A new X-Band portion will be developed
under a separate program at a later date, with AMDR initially using a 
SPQ-9B radar in its place. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge not attained; 

Product design is stable: 
* Release at least 90 percent of design drawings: Not applicable; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

AMDR Program: 

Technology and Design Maturity: 

All four of the AMDR's critical technologies are approaching full 
maturity and were demonstrated using a 1000-element radar array. The 
array is a smaller version of the planned AMDR arrays. According to 
the program, two technologies previously identified as the most 
challenging—-digital-beam-forming and transmit-receive modules, have 
been demonstrated in a relevant environment. Program officials stated 
digital-beam-forming is necessary for AMDR's simultaneous air and 
ballistic missile defense mission. The AMDR's transmit-receive 
modules-—the individual radiating elements of the radar—use gallium 
nitride technology instead of the legacy gallium arsenide technology for
potential efficiency gains. The other two critical technologies are 
related to software and digital receivers and exciters. Officials 
stated that software development will require a significant effort. A 
series of software builds are expected to deliver approximately 1 
million lines of code and are designed to apply open system approaches 
to commercial, off-the-shelf hardware. Integrating the X-band radar 
will require further software development. 

According to officials, much of AMDR's hardware has been demonstrated 
ahead of the preliminary design review, scheduled for June 2014, 
though the number of design drawings is still pending. The Navy 
obtained a waiver to hold this review after the start of system 
development citing cost concerns and a belief that the prototype array 
satisfactorily demonstrates AMDR's critical technologies. 

Other Program Issues: 

AMDR entered system development in October of 2013—-6 months later 
than planned, with corresponding delays to future program milestones. 
These delays might have an impact on the ability of the AMDR program 
to maintain its planned schedule for delivery in 2019. Additionally, the
delays might also hinder timely delivery of necessary information 
related to AMDR's parameters, such as power, cooling, and space 
requirements needed for ongoing and planned design studies related to 
Flight III development. However, program officials do not anticipate a 
delay for AMDR's planned 2019 availability for integration into the 
first planned DDG 51 Flight III. The X-band portion of AMDR will be 
comprised of an upgraded version of an existing rotating radar (SPQ-
9B), instead of the new design initially planned. The new radar will 
instead be developed as a separate program at a later date and 
integrated with the thirteenth AMDR unit. According to the Navy, the
upgraded SPQ-9B radar fits better within the Flight III's sea frame 
and expected power and cooling availability. Program officials state 
that the SPQ-9B radar will have capabilities equal to the new design
for current anti-air warfare threats, it will not perform as well 
against future threats. 

The Navy plans to install a 14-foot variant of AMDR on Flight III DDG 
51s starting in 2019. According to draft AMDR documents, a 14-foot 
radar is needed to meet threshold requirements, but an over 20-foot
radar is required to fully meet the Navy's desired integrated air and 
missile defense needs. However, the shipyards and the Navy have 
determined that a 14-foot active radar is the largest that can be 
accommodated within the existing DDG 51 deckhouse. Navy officials 
stated that AMDR is being developed as a scalable design but a new
ship would be required to host a larger version of AMDR. 

Program Office Comments: 

The program office concurred with this assessment and provided 
technical comments which were incorporated where appropriate. 

[End of assessment] 

CH-53K Heavy Lift Replacement Helicopter (CH-53K): 

[Illustration: Source: 2013 Sikorsky Aircraft Corporation] 

The Marine Corps' CH-53K heavy-lift helicopter is intended to 
transport armored vehicles, equipment, and personnel to support 
operations deep inland from a sea-based center of operations. The CH-53K
is expected to replace the legacy CH-53E helicopter and provide 
increased range and payload, survivability and force protection, 
reliability and maintainability, and coordination with other assets,
while reducing total ownership cost. 

Concept: 
Program start (11/03). 

System development: 
Development start (12/05); 
Design review (7/10); 
GAO review (1/14); 
Production readiness review (8/15); 
Low-rate decision (2/16). 

Production: 
Operational test complete (9/18); 
Initial capability (1/19). 

Program Essentials: 
Prime contractor: Sikorsky Aircraft Corporation; 
Program office: Patuxent River, MD; 
Funding needed to complete: 
R&D: $2,258.5 million ;
Procurement: $18,366.2 million; 
Total funding: $20,668.6 million; 
Procurement quantity: 194. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost:
As of 12/2005: $4,605.4; 
Latest 08/2013: $6,395.4; 
Percent change: 38.9. 

Procurement cost:
As of 12/2005: $12,808.2; 
Latest 08/2013: $18,366.2; 
Percent change: 43.4. 

Total program cost:
As of 12/2005: $17,413.6; 
Latest 08/2013: $24,805.5; 
Percent change: 42.4. 

Program unit cost:
As of 12/2005: $111.625; 
Latest 08/2013: $124.028; 
Percent change: 11.1. 

Total quantities:
As of 12/2005: 156; 
Latest 08/2013: 200; 
Percent change: 28.2. 

Acquisition cycle time (months) 
As of 12/2005: 119; 
Latest 08/2013: 157; 
Percent change: 31.9. 

The CH-53K program continues to move forward toward production, but 
has not yet fully matured its critical technologies or demonstrated 
that its design can perform as expected. As a result, the risk of 
design changes remains. According to program officials, the ground 
test vehicle has been delivered. However, a number of problems with 
producibility and qualification of parts have resulted in a delay in 
production of approximately 6 months and delays to qualification and 
flight testing. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained; 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge not attained; 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

CH-53K Program: 

Technology Maturity: 

The CH-53K program began system development in 2005 with immature 
critical technologies. Nearly 9 years later the program's two critical 
technologies—-the main rotor blade and main gearbox—-are approaching 
maturity. The program expects these technologies to be demonstrated in 
a realistic environment by its planned February 2016 production 
decision, a delay in 6 months over last year's schedule. Program 
officials reported that they conducted a three-blade whirl test that 
produced results that exceeded required outcomes. Flight testing is 
expected to begin in late 2014. 

Design Maturity: 

The CH-53K design appears stable, but it has not been demonstrated 
using a system-level prototype to show that it will perform as 
expected. The program has reported that they are relying on delivery 
of test vehicles to demonstrate their design. However, delivery of 
three of four of those test vehicles is projected to be delayed. 
Defense Contract Management Agency (DCMA) officials reported that the 
delays were caused by a number of factors such as late qualification 
testing, qualification test failures, re-testing, and the 
qualification of software. The delays have affected aircraft test 
schedules as well. 

Production Maturity: 

Delivery of the ground test vehicle, which began production in July 
2011, took place in October 2012. However, light off of the ground 
test vehicle-—which will include testing of the main gear box and the
rotor blades-—was delayed until December 2013. Late component 
deliveries and parts shortages have delayed additional test aircraft 
deliveries. Test vehicle production is now approximately 10 months
behind schedule, which has delayed the program's first test flight by 
approximately 4 months. These delays also resulted in a 6-month delay 
for the CH-53K's production decision, which has been moved to February 
2016. 

Other Program Issues: 

The CH-53K development contract was modified in April 2013 to reflect 
a new acquisition program baseline that reflects long standing 
increases in the program's cost and schedule. The program office
reported that part of the increase to the development contract was to 
include four system demonstration test articles. Program officials
reported that in July 2011, the contract's estimated cost increased by 
$724 million to $3.4 billion. However, recent Defense Contract 
Management Agency independent cost estimates place the cost closer to 
$3.7 billion, a total cost increase of approximately $1 billion. The 
program's schedule contains concurrency between production and
testing, which represents risk to the program and may require costly 
retrofits to aircraft after they have already been produced. 

Program Office Comments: 
In commenting on a draft of this assessment, the program office 
provided technical comments, which were incorporated as appropriate. 

[End of assessment] 

DDG 1000 Zumwalt Class Destroyer (DDG 1000): 

[Illustration: Source: © 2013 General Dynamics Bath Iron Works] 

The Navy's DDG 1000 destroyer is a multimission surface ship designed 
to provide advanced capability for littoral operations and land-attack 
in support of forces ashore. The ship will feature a low radar profile 
and an advanced gun system. The lead ship was launched in October 2013 
and the ship (comprised of the hull and mechanical and electrical 
systems) is currently scheduled for delivery in September 2014, with 
activation of the mission systems starting in 2015. Fabrication is 
underway on the remaining two ships in the class. 

Concept: 
Program start (1/98). 

System development: 
Development start (3/04). 

Production: 
Production decision (11/05); 
Contract award detail design (8/06); 
Lead-ship fabrication start (2/09); 
GAO review (1/14); 
Lead-ship delivery (9/14); 
Initial capability (7/16). 

Program Essentials: 
Prime contractor: BAE Systems, Bath; 
Iron Works, Huntington Ingalls Industries, Raytheon Program office: 
Washington, DC; 
Funding needed to complete:
R&D: $569.4 million; 
Procurement: $768.8 million; 
Total funding: $1,338.2 million; 
Procurement quantity: 0. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 1/1998: $2,395.9; 
Latest 08/2013: $10,593.2; 
Percent change: 342.2. 

Procurement cost: 
As of 1/1998: $34,205.7; 
Latest 08/2013: $11,406.4; 
Percent change: -66.7. 

Total program cost: 
As of 1/1998: $36,601.6; 
Latest 08/2013: $21,999.6; 
Percent change: -39.9. 

Program unit cost: 
As of 1/1998: $1,143.799; 
Latest 08/2013: $7,333.213; 
Percent change: 541.1. 

Total quantities: 
As of 1/1998: 32; 
Latest 08/2013: 3; 
Percent change: -90.6. 

Acquisition cycle time (months): 
As of 1/1998: 128; 
Latest 08/2013: 222; 
Percent change: 73.4. 

The DDG 1000 program has made progress in developing its critical 
technologies and the ship design is largely mature. While few design
changes resulted from lead ship construction, the Navy decided to 
build the third ship's deckhouse and hangar with steel rather than 
composite materials due to manufacturing and integration challenges on 
the first two ships and as a long-term cost saving measure. The 
program is also incorporating technical configuration changes to
maintain capability and minimize cost. Delivery of the lead ship 
(hull, mechanical and electrical systems) may slip past the currently 
scheduled date of September 2014 due to difficulties in completing the 
ship's electrical systems which is impacting test and activation 
events. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

DDG 1000 Program: 

Technology Maturity: 

The DDG-1000 program has made progress in developing its critical 
technologies. However, only 3 of 11 are mature and the remaining 8 
will not be demonstrated in a realistic environment until after
installation on the lead ship. Guided flight tests of the gun system's 
long-range land-attack projectile were successfully completed in 
October 2013. After significant cost growth and development 
challenges, all six software releases for the total ship computing 
environment have been completed and certified to support lead ship 
activation and delivery and a software spiral update is under
contract timed to support initial operating capability. Following a 
critical Nunn-McCurdy unit-cost breach in 2010, DOD restructured the 
program and removed the volume search radar from the ship's design. A 
modified multifunction radar is expected to begin land based testing 
in 2014, followed by at-sea testing in 2015. 

Design and Production Maturity: 

The DDG 1000 design is largely mature. According to the program 
manager and ship builder, as of October 2013, production and test 
efforts for the first two ships were 88 and 70 percent complete,
respectively. While few design changes have resulted from lead ship 
construction, shipbuilders have experienced challenges with the 
manufacture and integration of the composite deckhouse for the first 
and second ships, resulting in rework and schedule delays particularly 
on the first ship. The Navy has emphasized a joint inspection process
whereby the prime contractors and the Navy validate product quality 
and completeness prior to integration with the hull. After assessing 
alternatives and conducting a competition, the Navy decided to build 
the third ship's deckhouse and hangar with steel as a cost saving 
measure as the program manager noted that the Navy has better cost
insights into the long-term maintenance of steel compared to composite 
materials. 

Other Program Issues: 

Delivery of the lead ship (hull, mechanical and electrical systems) 
may slip past the currently scheduled date of September 2014 and the 
Navy is in the process of assessing the delivery date. If delivery 
slips past October 2014, the program will breach its acquisition 
program baseline schedule requirements. According to the Navy, the 
delay is the result of difficulties in completing the ship's 
electrical systems, which is impacting test and activation events. 

The program has awarded all major contracts for the three ships in the 
DDG 1000 class among four prime contractors. As the integrator, the 
Navy is responsible for ensuring on-time delivery of products and 
bears the costs of schedule delays that affect another contractor. 
Bath Iron Works is now producing the hull for all three ships. In August
2013, the Navy awarded a fixed price contract to Bath Iron Works for a 
steel deckhouse, hangar, and aft peripheral vertical launching system 
for the third ship. According to the program manager, the shipbuilder 
negotiated a 5- and 10-month delivery delay for the second and third 
ship, respectively. 

Program officials also reported that the program absorbed 
sequestration reductions of $70 million in fiscal year 2013 by 
delaying testing and the award of contracts for mission-related 
equipment. The program is also incorporating technical configuration 
changes resulting from the configuration steering board and Nunn-McCurdy
annual cost review aimed at maintaining capability and minimizing 
costs. For example, the program manager told us the program assessed 
alternatives to the close in gun system and chose a legacy system that 
met requirements with about half the weight and cost. 

Program Office Comments: 

In commenting on a draft of this assessment the Navy noted that the 
DDG 1000 lead ship was successfully launched in October 2013, a
christening is scheduled for April 2014, and activation activities 
continue. For the second ship, keel laying and hangar erection have 
occurred, hull integration is underway, and deckhouse delivery is
scheduled for spring 2014. The Navy noted that significant integration 
efforts between four prime contractors continue with a focus on cost 
reduction and schedule performance. The Navy also provided technical 
comments, which were incorporated where deemed appropriate. 

[End of assessment] 

Enhanced Polar System (EPS): 

[Illustration: Source: LinQuest Corporation] 

The Air Force's Enhanced Polar System (EPS) is to provide next-
generation protected extremely high frequency (EHF) satellite 
communications in the polar region. It will replace the current 
Interim Polar System and serve as a polar adjunct to the Advanced EHF 
(AEHF) system. EPS is to consist of two EHF payloads hosted on 
classified satellites, a gateway to connect modified Navy Multiband
Terminals to other communication systems, and a control and planning 
segment (CAPS). 

Concept: 
Program initiation (12/07); 
GAO review (1/14). 

System development/Production: 
Development start (2/14); 
Design review (7/14); 
Payload-1 on orbit (Q2 FY15); 
Payload-2 on orbit (Q2 FY17); 
End operational test (2/18); 
Operational capability (6/18). 

Program Essentials: 
Prime contractor: Northrop Grumman Information Systems; 
Program office: Los Angeles AFB, CA; 
Funding needed to complete:
R&D: $398.1 million; 
Procurement: $0.0 million; 
Total funding: $398.1 million; 
Procurement quantity: 0. 

Program Performance (fiscal year 2014 dollars in millions) 

Research and development cost: 
As of: NA; 
Latest 07/2013: $1,505.3; 
Percent change: NA. 

Procurement cost: 
As of: NA; 
Latest 07/2013: $0.0; 
Percent change: NA. 

Total program cost: 
As of: NA; 
Latest 07/2013: $1,505.3; 
Percent change: NA. 

Program unit cost: 
As of: NA; 
Latest 07/2013: $752.625; 
Percent change: NA. 

Total quantities: 
As of: NA; 
Latest 07/2013: 2; 
Percent change: NA. 

Acquisition cycle time (months)
As of: NA; 
Latest 07/2013: 126; 
Percent change: NA. 

The three segments of the EPS are in various stages of development. 
Although the EPS program's two payloads are built, funding constraints 
resulted in reductions to the requirements of the control and planning 
segment and gateway segment, which delayed initial operational 
capability by 2 years. However, the reduction of capabilities also 
reduced the amount of development necessary and allowed for a revised 
acquisition strategy that, according to the program office, reduced 
risk and cost. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Not applicable; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Not applicable; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

EPS Program: 

Technology and Design Maturity: 

EPS was initiated in 2007 to fill a gap identified in the Advanced 
Polar System study. The Under Secretary of Defense for Acquisition, 
Technology, and Logistics directed the program to proceed to system 
development to synchronize the program's payload schedule with the 
host satellite's production timeline. The host program awarded the 
payload development contract in July 2008, following an acquisition 
board equivalent to a system development decision. Payload development
proceeded and all six critical technologies are fully mature, 
according to the program office. Both payloads are built and the first 
payload is fully integrated into the host satellite, which is currently
undergoing system-level testing. 

In contrast, the control and planning segment (CAPS) and gateway 
development was delayed. Because of funding constraints, the program 
office used a design-to-cost approach to reduce CAPS and gateway 
development to the minimum capability needed. The revised EPS 
acquisition strategy incorporating changes to CAPS and gateway 
development was approved in January 2012. The CAPS design contract was 
awarded in December 2012, with a planned system development decision 
in July 2014. The gateway requires integration of existing commercial 
off-the-shelf and government furnished equipment and is considered low 
risk by the program office. 

Other Program Issues: 

The reduction in capabilities for the CAPS and gateway allowed a 
change in acquisition strategy that reduced cost and risk but also 
delayed operational capability from fiscal year 2016 to 2018. Under 
the original acquisition strategy, CAPS was planned as a follow-on 
increment to the AEHF mission control segment. A sole source award was
to be made to AEHF's prime contractor for CAPS, while the gateway was 
to be competitively awarded. The reduced requirements and revised 
acquisition strategy allowed for CAPS to be competitively awarded. The 
reduction of requirements nearly eliminated the development work for 
the gateway. Consequently, the Navy's Space and Naval Warfare Systems 
Command (SPAWAR) System Center Pacific will be responsible for 
integrating, testing, installing, certifying, and sustaining the gateway
segment. According to the program office, this approach also reduces 
cost and schedule as it would take time for a contractor to develop the
expertise and test beds that SPAWAR System Center Pacific already has. 
The reduction in requirements and revised acquisition strategy reduced 
overall program cost by about $1 billion, according to program 
officials. 

The payloads are expected to be on orbit in fiscal years 2015 and 2017 
respectively. By the current schedule, CAPS site installation will 
occur in late fiscal year 2016. According to the program office, CAPS 
is not required for payload on-orbit testing, but it is required for 
inter-segment testing scheduled for the first quarter of fiscal year 
2017 and for overall functioning of the EPS system. There is adequate 
schedule margin according to officials, but any additional delays such 
as delayed funding or program milestones will result in a further 
delay in operational capability. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office 
provided technical comments, which were incorporated where deemed 
appropriate. 

[End of assessment] 

Evolved Expendable Launch Vehicle (EELV): 

[Illustration: Source: © 2012 United Launch Alliance] 

The Air Force's EELV program acquires launch services to provide 
critical space support to DOD, national security, and other government 
missions. The United Launch Alliance is currently the sole provider of 
launch vehicles for U.S. military and intelligence satellites. 
However, the Air Force may certify new launch providers to compete for 
future launch services. Today, the program consists of two families of 
launch vehicles, support systems, and launch site operations. We 
assessed the Atlas V and the Delta IV. 

Concept: 
Program start (12/96). 

System development: 

Production: 
Development/production start (6/98); 
Medium-lift first flight (8/02); 
Heavy-lift first flight (12/04); 
Initial capability (12/06); 
Milestone recertification (2/13); 
GAO review (1/14). 

Program Essentials: 
Prime contractor: United Launch Services, LLC; 
Program office: El Segundo, CA; 
Funding needed to complete:
R&D: $81.4 million; 
Procurement: $42,848.3 million; 
Total funding: $42,929.7 million; 
Procurement quantity: 89. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 10/1998: $1,872.6; 
Latest 08/2013: $2,460.6; 
Percent change: 31.4. 

Procurement cost: 
As of 10/1998: $16,403.2; 
Latest 08/2013: $61,463.2; 
Percent change: 274.7. 

Total program cost: 
As of 10/1998: $18,275.9; 
Latest 08/2013: $63,923.7; 
Percent change: 249.8. 

Program unit cost: 
As of 10/1998: $100.972; 
Latest 08/2013: $420.551; 
Percent change: 316.5. 

Total quantities: 
As of 10/1998: 181; 
Latest 08/2013: 152; 
Percent change: -16.0. 

Acquisition cycle time (months) 
As of 10/1998: NA; 
Latest 08/2013: 120; 
Percent change: NA. 

We assessed EELV technology as mature with 66 successful launches as 
of December 2013. We could not assess design or production maturity
using our best practices. All of the 14 EELV launch vehicle variants 
have launched at least once. However, only three variants-—the Atlas V
401, the Delta IV Medium, and the Delta IV Heavy-—have launched seven 
times, proving production maturity according to an Aerospace 
Corporation measure developed for the program. EELV completed 
recertification after reporting Nunn-McCurdy critical unit cost 
breaches in the March 2012 Selected Acquisition Report and 
transitioned back into the production phase in February 2013. The 
program is estimated to cost over $70 billion through 2030. EELV program
officials are currently conducting activities to certify new launch 
providers and signed a contract modification to procure additional EELV
launches. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Not applicable. 

Product design is stable: 
* Release at least 90 percent of design drawings: Not applicable; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

EELV Program: 

Technology, Design, and Production Maturity: 

While EELV's technology is mature, we could not assess design and 
production maturity because the Air Force does not obtain information 
from the contractor that would facilitate this assessment. According 
to the Aerospace Corporation's measurement known as the "3/7 
reliability rule," once a vehicle variant is launched successfully
three times its design can be considered mature. Similarly, if a 
vehicle is successfully launched seven times, both the design and 
production process can be considered mature. Based on this rule, few
variants have reached maturity for both design and production. Each of 
the 9 Atlas V variants and the five Delta IV variants has flown at 
least once, demonstrating the viability of their technologies, and
10 of the Atlas and Delta variants have flown three times, 
demonstrating design maturity according to Aerospace's rule. However, 
only 3 of the 14 EELV variants have demonstrated production maturity
with seven flights. Until a launch vehicle configuration demonstrates 
design and production maturity, problems with fleetwide designs or
production processes may go undiscovered, which could cause 
significant cost and schedule risk. 

The Air Force is investigating the root cause of an anomaly with the 
Delta IV upper stage engine which did not perform as expected during a 
launch in October 2012. According to the EELV program office, the 
initial phase of the investigation was completed in May 2013 but a 
root cause determination was not made. While the engine has performed 
normally on launches in May and August 2013, the Air Force delayed a 
third launch of the Delta IV scheduled for October 2013, due to new
conclusions from the investigation and to fully understand the anomaly 
and reduce any potential risks. 

Other Program Issues: 

Due to a program restructuring stemming from the Nunn-McCurdy breaches 
reported in the March 2012 Selected Acquisition Report, the program
developed a new acquisition program baseline, which was approved in 
early 2013. The estimated costs for the program are about $70 billion 
based on the need for 151 launches through the year 2030. This 
estimate is around $35.7 billion more than the previous estimate 
reported in March 2012. The program identified several causes for this 
cost growth including extension of the program life-cycle from 2020 to 
2030, procurement of 60 additional launch vehicles, the inherently 
unstable nature of the demand for launch services, and industrial base 
instability. 

The Air Force signed a contract modification in December 2013 to 
procure additional EELV launches and has revised its acquisition 
strategy to meet some of DOD's EELV-class launch vehicle needs. EELV-
class is defined as a vehicle or family of vehicles that can reliably 
launch a variety of payloads up to 13,500 pounds to geosynchronous
earth orbit. The revised strategy outlines how to certify a new 
provider's launch vehicle based on risk classifications for individual 
payloads. After a new provider completes its first successful flight, 
the Air Force will award early integration study contracts for
the payloads the vehicle is projected to be capable of launching. In 
November 2012, the Air Force awarded an EELV-class launch service 
contract to Space Exploration Technologies (SpaceX), in an effort to 
support the demonstration of its capabilities as part of the 
certification process. In September and December 2013, SpaceX launched 
its first and second vehicles toward certification respectively. 

Program Office Comments: 

The Air Force provided technical comments, which were incorporated as 
appropriate. 

[End of assessment] 

Excalibur Precision 155mm Projectiles (Excalibur): 

[Illustration: Source: U.S. Army] 

The Army's Excalibur is a family of global positioning system-based, 
fire-and-forget, 155mm cannon artillery precision munitions intended 
to provide improved range and accuracy. The near-vertical angle of 
fall is expected to reduce collateral damage, making it more effective 
in urban environments. The Army is using an incremental approach to 
deliver capabilities. Increment Ia-1 is fielded, Ia-2 is in 
production, and Ib, which is expected to increase reliability and 
lower unit costs, began production in 2012. We assessed increment Ib. 

Concept: 

System development: 
Program/development start (5/97); 
Design review (4/11); 

Production: 
Low-rate decision (12/12); 
GAO review (1/14); 
End operational test (3/14); 
Full-rate decision (7/14); 
Initial capability (7/14). 

Program Essentials: 
Prime contractor: Raytheon; 
Program office: Picatinny Arsenal, NJ; 
Funding needed to complete:
R&D: $7.9 million; 
Procurement: $75.9 million; 
Total funding: $83.9 million; 
Procurement quantity: 952. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
$805.1; 
$1,137.6; 
41.3. 

Procurement cost: 
As of 02/2003: $4,218.4; 
Latest 08/2013: $702.0; 
Percent change: -83.4. 

Total program cost:
As of 02/2003: $5,023.5; 
Latest 08/2013: $1,839.6; 
Percent change: -63.4. 

Program unit cost:
As of 02/2003: $0.066; 
Latest 08/2013: $0.281; 
Percent change: 328.4. 

Total quantities:
As of 02/2003: 76,677; 
Latest 08/2013: 6,555; 
Percent change: -91.5. 

Acquisition cycle time (months): 
As of 02/2003: NA; 
Latest 08/2013: 206; 
Percent change: NA. 

Note: Total quantities include 2,849 increment Ib projectiles. 

The Excalibur program has made multiple design changes to address 
reliability concerns since 2012, including a risk that it may not meet 
its reliability threshold requirement. The Ib round still does not 
meet insensitive munitions requirements. According to program officials,
however, it does meet military standards and the program has projected 
test dates to address concerns of the Army Insensitive Munitions 
Board. The program reduced the number of rounds planned for 
procurement due to a recommendation in the conference report
accompanying the Consolidated and Further Continuing Appropriations 
Act, 2013 and sequestration but has requested restitution of those 
funds in fiscal years 2015 and 2016. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge not 
attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
attained; 
* Test a production-representative prototype: Knowledge attained. 

Excalibur Program: 

Technology and Design Maturity: 

The Excalibur program's critical technology is fully mature. The 
program has made multiple incremental design changes intended to 
increase reliability since the low-rate production decision in 2012. 
For example, the contractor producing the Global Positioning System 
(GPS) receiver made hardware and software changes to increase receiver 
reliability in the gun launch environment. Additionally, the program 
has made changes to the guidance assembly and the fuze safe and arm
device to address failures during Ib round developmental testing. 
There have been no design changes to the warhead or the operational 
flight software. The Ib round still does not meet requirements related 
to insensitive munitions—-ensuring that a round will not detonate 
under any condition other than its intended mission. According to 
program officials, however, it does meet military standards. The 
program reports that a follow-up test to meet the Army Insensitive 
Munitions Board requirements, which was delayed due to sequestration 
and furloughs during the government shutdown, is projected for early 
2014. Ensuring compliance with this requirement could require design 
changes and the program is uncertain of the total number of drawings 
that will ultimately be required. 

The program reported that it received a funding increase in fiscal 
year 2014 of $5 million to support the completion of initial 
operational test and evaluation, which was subsequently reduced due to
sequestration for a net increase of $4.3 million. All performance and 
safety requirements have been met, but reliability testing will not be 
complete until after production has begun. 

Production Maturity: 

According to program officials, the program is at low risk of not 
meeting its reliability threshold of 90 percent and at moderate-to-
high risk of not meeting its reliability objective. However, given 
test results since the low-rate decision, the program expects to
meet the threshold reliability requirement. The program has been 
authorized to procure 1800 rounds in low-rate production and will seek 
authorization to procure the remaining rounds at the full-rate 
production decision, tentatively scheduled for mid-2014. 

Other Program Issues: 

The program is still projecting to produce 3,455 Ib rounds, but its 
fiscal year 2013 procurement funding was cut by $47.5 million due to a 
recommendation in the conference report accompanying the Consolidated 
and Further Continuing Appropriations Act, 2013 and sequestration. As a
result the program is reporting a 17 percent reduction of rounds for 
procurement. The program, however, has requested restoration of 
funding for those rounds in fiscal years 2015 and 2016. The project 
originally planned for funding to end in fiscal year 2014; spreading 
funding into future years will increase the life of the program and 
may have additional costs. 

Program Office Comments: 

In commenting on a draft of this assessment, program officials stated 
that Excalibur continues to provide commanders with an organic 
precision targeting capability resulting in over 700 rounds
being fired in combat to date. They also stated that the program 
continues to execute within all acquisition program baseline 
parameters and is meeting or exceeding all five of its key performance
parameters. Excalibur Increment Ib has shown performance improvements 
and continues to execute to the plan approved by both the Army and
joint insensitive munitions board and has seen improvements in the 
area of less sensitive reactions. 

Program officials stated that the final Excalibur increment began low-
rate initial production in first quarter fiscal year 2014 and 
successfully completed first article testing in December 2013. The 
current Excalibur production contract contains fixed price procurement 
options to ensure consistent procurement costs through fiscal year 
2016. The program also provided technical comments, which were 
incorporated as appropriate. 

[End of assessment] 

F-22 Increment 3.2B: 

[Illustration: Source: U.S. Air Force] 

The Air Force's F-22 Raptor is a stealthy air-to-air and air-to-ground 
fighter/attack aircraft. The Air Force established an F-22 
modernization and improvement program in 2003 to add enhanced air-to-
ground, information warfare, reconnaissance, and other capabilities 
and to improve the reliability and maintainability of the aircraft. 
Increment 3.2B, the fourth increment of the modernization program,
was initially managed as part of the F-22 baseline program, but is now 
being managed as a separate major defense acquisition program. 

Concept: 

System development: 
Development start (6/13); 
GAO review (1/14); 
Design review (10/15). 

Production: 
Low-rate decision (9/16); 
Start operational test (1/17); 
Full-rate decision (7/18); 
Initial capability (9/19). 

Program Essentials: 
Prime contractor: Lockheed Martin; 
Program office: Wright-Patterson AFB, OH; 
Funding needed to complete:
R&D: $543.1 million; 
Procurement: $339.1 million; 
Total funding: $882.2 million; 
Procurement quantity: 143. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 06/2013: $1,222.1; 
Latest 09/2013: $1,218.8; 
Percent change: -0.3. 

Procurement cost: 
As of 06/2013: $344.6; 
Latest 09/2013: $339.1; 
Percent change: -1.6. 

Total program cost: 
As of 06/2013: $1,566.7; 
Latest 09/2013: $1,557.9; 
Percent change: -0.6. 

Program unit cost: 
As of 06/2013: $10.308; 
Latest 09/2013: $10.249; 
Percent change: -0.6. 

Total quantities: 
As of 06/2013: 152; 
Latest 09/2013: 152; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 06/2013: 72; 
Latest 09/2013: 75; 
Percent change: 4.2. 

Increment 3.2B is an enhancement to the F-22, bringing upgraded 
electronic protection, geolocation, and intra-flight data link 
capabilities, and integrating AIM-9X and AIM-120D missiles. The Air 
Force received approval to begin system development of Increment 3.2B 
as a separate major defense acquisition program in June 2013. The one 
reported critical technology has been demonstrated in a relevant, but 
not a realistic, environment. Full maturity is expected by the 
critical design review in October 2015, by which point the Air Force 
also anticipates achieving full design stability. There may be a 
production gap of two to four years between qualification of hardware 
for the program and the beginning of low-rate initial production. The 
program office stated that it has mitigated risk related to AIM-9X
software development. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Not applicable; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

F-22 Inc 3.2B Program: 

Technology and Design Maturity: 

Increment 3.2B's sole, identified critical technology, a geolocation 
algorithm, is not yet fully mature having been demonstrated only in a 
relevant environment. The program office expects the technology to 
reach full maturity by October 2015. The Air Force also anticipates 
achieving full design stability by the October 2015 critical design 
review as 92 percent of system level drawings are currently 
releasable. A knowledge-based acquisition approach is a cumulative 
process, and mature technology is a prerequisite for moving into system
development. The program intends to demonstrate that the design can 
perform as expected by integrating and testing all key subsystems and
components prior to the critical design review. 

Production Maturity: 

Prior to system development, DOD systems engineering personnel 
identified a production gap of two to four years between qualification 
of hardware for Increment 3.2B and the beginning of low-rate initial 
production as a risk as some of the electronic components used may no 
longer be available when production begins. The program office stated 
that it is working closely with suppliers to mitigate identified risks 
through an advance procurement contract. Program officials partly 
attributed the gap to an early start made on hardware development
given initial assumptions about the amount of development involved. 
Additionally, the Defense Contract Management Agency has noted supplier
developmental issues with displays and processing modules which 
support Increment 3.2B. 

Other Program Issues: 

Consistent with direction from Congress and the Office of the 
Secretary of Defense, the Air Force designated F-22 Increment 3.2B as 
a distinct major defense acquisition program rather than managing
it as part of the F-22 baseline program. About half of the program's 
$1.2 billion estimated development cost was spent under the F-22 
baseline program. Originally scheduled for December 2012, the
approval to formally initiate the Increment 3.2B acquisition program 
and begin system development was delayed until June 2013 as it took 
longer than expected to prepare Air Force and independent cost 
estimates. According to cost estimators, the delay is attributable to 
their having to reconstruct missing cost information from prior 
modernization increments in order to estimate costs for Increment 3.2B. 

An initial risk assessment noted that if the Increment 3.2B program 
did not receive the customized software that allows the F-22 to use 
the AIM-9X air-to-air missile in time for operational testing, it might
face a delay in its overall fielding schedule. The F-22 program office 
stated that it has mitigated risk related to missile software 
development, and has signed an agreement with the AIM-9X program
office on technical and schedule requirements for integrating the 
missile. The F-22 program office plans to field limited AIM-9X 
capabilities prior to the completion of Increment 3.2B by including 
them as part of an earlier software update. 

Program Office Comments: 

The Air Force provided technical comments, which were incorporated as 
appropriate. 

[End of assessment] 

F-35 Lightning II Program (F-35): 

[Illustration: Source: Courtesy of Lockheed Martin] 

DOD's F-35 program is developing a family of stealthy, strike fighter 
aircraft for the Navy, Air Force, Marine Corps, and U.S. allies, with 
the goal of maximizing commonality to minimize life-cycle costs. The 
carrier-suitable variant will complement the Navy F/A-18E/F. The Air 
Force variant is expected to replace the air-to-ground attack 
capabilities of the F-16 and A-10, and complement the F-22A. The short 
take-off and vertical landing (STOVL) variant is expected to replace 
the Marine Corps F/A-18 and AV-8B aircraft. 

Concept: 
Program start (11/96). 

System development: 
Development start (10/01); 
Design review (2/06 & 6/07); 

Production: 
Production decision (6/07); 
Milestone recertification (3/12); 
GAO review (1/14); 
Start operational test (6/15); 
USMC initial capability (7/15); 
USAF initial capability (8/16); 
USN initial capability (8/18). 

Program Essentials: 
Prime contractor: Lockheed Martin, Pratt and Whitney; 
Program office: Arlington, VA; 
Funding needed to complete:
R&D: $5,516.9 million; 
Procurement: $231,243.5 million; 
Total funding: $239,559.1 million; 
Procurement quantity: 2,293. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 10/2001: $40,995.1; 
Latest 08/2013: $61,795.8; 
Percent change: 50.7. 

Procurement cost: 
As of 10/2001: $181,875.9; 
Latest 08/2013: $266,469.1; 
Percent change: 46.5. 

Total program cost: 
As of 10/2001: $224,774.7; 
Latest 08/2013: $332,320.0; 
Percent change: 47.8. 

Program unit cost: 
As of 10/2001: $78.428; 
Latest 08/2013: $135.254; 
Percent change: 72.5. 

Total quantities: 
As of 10/2001: 2,866; 
Latest 08/2013: 2,457; 
Percent change: -14.3. 

Acquisition cycle time (months): 
As of 10/2001: 116; 
Latest 08/2013: 237; 
Percent change: 104.3. 

Although the F-35 program has invested billions of dollars and ordered 
150 production aircraft, gaps in product knowledge persist. Four 
critical technologies are not mature and the program continues to 
experience design changes. Development testing is progressing but is 
far from complete and will likely drive more changes in design and 
manufacturing processes. While manufacturing efforts are improving, 
only twenty-five percent of the program's critical manufacturing 
processes are mature and capable of consistently producing quality 
parts, and fewer planes were produced in 2013 than initially planned. 
Software development has progressed; but if additional delays are 
encountered initial operating capability dates could be at risk. Long-
term affordability and sustainment costs remain challenging. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge not attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge not 
attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
attained; 
* Test a production-representative prototype: Knowledge attained. 

F-35 Program: 

Technology Maturity: 

Three of the program's critical technologies are nearing maturity 
while one is immature. The program has made progress addressing 
technical risks including the helmet mounted display, which is needed 
for the aircraft to fully perform its missions, and the Autonomic 
Logistics Information System (ALIS), which is critical to the 
operations and sustainment of the fleet. The program recently chose to 
end development of an alternate helmet due to progress made on the 
original helmet design and work on development of a newer generation 
helmet. ALIS integration and testing continues with the next, more 
capable version expected to be delivered in 2014. 

Design Maturity: 

Although the three aircraft designs were not stable at critical design 
reviews in 2006 and 2007, all expected engineering drawings have since 
been released. However, issues discovered in testing continue to drive 
design changes. In 2013, bulkhead and rib cracks were discovered in 
the STOVL variant that may require the program to make changes to 
production and retrofit aircraft. The carrier variant's new arresting 
hook system successfully completed a critical design review and is 
expected to be ready for carrier use by October 2014. With significant 
testing remaining, additional design changes are likely. 

Production Maturity: 

DOD has invested about $35 billion in procuring 150 aircraft through 
2013. The contractor uses statistical process controls as one means to 
assess critical manufacturing processes. Twenty five percent of those 
processes are currently judged capable of consistently producing 
quality parts at the best practice standards. Production efforts have
improved as the production line continues to show efficiencies and 
quality metrics show positive trends. However, in 2013, problems with 
engine hoses, engine turbines, and specialty metals halted production 
deliveries for three months. In 2013, 35 planes were delivered to the 
government—eight less than originally planned. Aircraft deliveries were
postponed for one month while the runway at the final assembly 
facility was resurfaced. 

Other Program Issues: 

In 2013, the military services re-established initial operating 
capability dates for their respective F-35 variants. To achieve those 
dates, the Marine Corps and Air Force will accept basic warfighting
capabilities provided by software Blocks 2B and 3I respectively, while 
the Navy intends to wait for the full suite of capabilities provided 
by software Block 3F. Block 2B development is currently behind 
schedule, which could impact the development of Block 3I, and 
subsequently 3F. Any additional software delays could put initial 
operating capability dates at risk as software is essential to achieve
aircraft capabilities such as sensor fusion, weapons and fire control, 
maintenance diagnostics, and propulsion. In addition, the program's 
long-term affordability remains a challenge. The amount of annual 
funding required to complete development and procurement of the F-35 
is more than $12 billion on average, while the cost to operate and 
support the aircraft is estimated at more than $1 trillion over its 
life-cycle. These estimates may change over time as testing progresses 
and more concrete information becomes available. 

Program Office Comments: 

In addition to providing technical comments, the program noted that it 
appreciates GAO's reviews in assisting the program by identifying 
areas for improvement. The program has made great strides in the past 
year to further stabilize technology, design, and production maturity, 
and work continues on identified areas to improve program performance. 
The program ended development of the alternate F-35 helmet as further 
testing indicated it is acceptable for USMC initial operating 
capability. Continued improvements will be made in the Gen III helmet. 
This decision includes a guarantee from industry to reduce the unit 
cost by 12 percent from previous estimates. Aircraft and engine 
quality continues to improve as manufacturing processes mature, and 
unit costs continue to come down lot over lot. The program has taken 
steps to improve management of concurrency risk and minimize costs to 
the services by reducing the time required to implement changes into 
the production line so that fewer aircraft need post-production 
retrofits. 

[End of assessment] 

Family of Beyond Line-of-Sight - Terminals (FAB-T): 

[Illustration: Source: U.S. Air Force] 

The Air Force's FAB-T program plans to provide a family of satellite 
communications terminals for airborne and ground-based users to 
replace many program-unique terminals. It is being designed to work 
with current and future communications capabilities and technologies. 
FAB-T is expected to provide voice and data over military satellite 
communications for nuclear and conventional forces through ground 
command posts and E-6 and E-4 aircraft, and was originally planned to 
provide force element capabilities on B-2, B-52, and RC-135 aircraft. 

Concept: 

System development: 
Development start (9/02); 
Design review (10/08). 

Production: 
Award production readiness contracts (9/13); 
GAO review (1/14); 
Production down-select (3/14); 
Full-rate decision (3/15); 
Initial capability (9/19). 

Program Essentials: 
Prime contractor: Boeing, Raytheon; 
Program office: Bedford, MA; 
Funding needed to complete:
R&D: $196.0 million; 
Procurement: $2,190.6 million; 
Total funding: $2,386.6 million; 
Procurement quantity: 216. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 12/2006: $1,616.7; 
Latest 10/2013: $2,406.0; 
Percent change: 48.8. 

Procurement cost: 
As of 12/2006: $1,736.9; 
Latest 10/2013: $2,212.0; 
Percent change: 27.4. 

Total program cost: 
As of 12/2006: $3,353.6; 
Latest 10/2013: $4,618.0; 
Percent change: 37.7. 

Program unit cost: 
As of 12/2006: $15.526; 
Latest 10/2013: $18.772; 
Percent change: 20.9. 

Total quantities: 
As of 12/2006: 216; 
Latest 10/2013: 246; 
Percent change: 13.9. 

Acquisition cycle time (months): 
As of 12/2006: 129; 
Latest 10/2013: 204; 
Percent change: 58.1. 

The latest cost data do not reflect the current cost of the program 
and the latest quantities do not reflect recent program decisions. A 
new acquisition program baseline has not yet been approved. 

FAB-T Program: 

Technology Maturity: 

According to the program office, all of the critical technologies for 
both vendors are fully mature based on the vendors' self-assessments. 
The program does not currently plan to conduct an independent 
technology readiness assessment for the alternate vendor. The program 
office also stated that both vendors have functional prototypes being
utilized for testing. 

Design Maturity: 

According to the program office, FAB-T's design is stable for both the 
original and alternate vendor development programs. The original vendor
completed functional qualification testing in August 2013. The 
alternate vendor completed a system-level design review in June 2013 
and demonstrated a system-level integrated prototype in October 2013. 

Production Maturity: 

In 2012, FAB-T's acquisition strategy was changed to initiate two 
possible production paths: one providing both command and force element
terminals, and the other only command terminals. Both vendors 
submitted proposals to compete for both approaches. In December 2013, 
the Air Force chose to pursue the command terminal only approach and 
the program plans to make a down-select decision to one vendor in the 
second quarter of fiscal year 2014. Depending on which vendor is
chosen, the low-rate production decision is planned for either March 
2014 or September 2014. 

A 2012 acquisition decision memorandum called for several steps before 
the award of FAB-T's production contracts, including: an independent 
cost estimate; a revised acquisition program baseline; and a defense 
acquisition board review. Program officials stated that neither the 
cost estimate nor the revised baseline will be completed prior to the
down-select decision. Department officials stated that the review has 
been delayed and not yet rescheduled. Also, FAB-T does not plan to
independently assess manufacturing readiness levels prior to the down-
select decision. Air Force decisions to commit to a production 
contractor before the program is fully assessed introduce additional 
acquisition risk. 

Other Program Issues: 

In October 2010, an independent review team noted that the program was 
likely in breach of critical Nunn-McCurdy unit cost thresholds but a 
breach has not yet been reported by the program. In 2012, the FAB-T 
program made several revisions to its acquisition strategy—including 
modification of the original development contract from cost plus award
fee to firm fixed-price and the addition of competition by awarding 
the alternate vendor contract in response to these concerns about cost
growth. However, a new acquisition program baseline and independent 
cost estimate that reflect these changes and their projected costs 
will not be completed until 2014. 

According to Department officials, the requirement for the force 
element terminals remains in the program but is not currently funded. 
If not integrated with the B-2 and B-52 bomber platforms, FAB-T may 
not meet its full range of planned communications capabilities as some 
are based on the interaction of bomber aircraft with intelligence,
surveillance, and reconnaissance aircraft and command terminals. 

Program Office Comments: 

According to program officials, the FAB-T program office continued to 
execute the revised acquisition strategy in 2013. Significant progress 
was made by both contractors on their respective development 
contracts. With respect to production efforts, production planning 
contracts were awarded to lock down prices. In addition, the 
competition for command terminals is on-going, and the Air Force
has scheduled a down select decision in the second quarter of fiscal 
year 2014. The independent cost estimate and acquisition program 
baseline will then be updated to re-baseline the program. To address
the cost thresholds and breach concerns, program officials said they 
are confident that adequate technology and manufacturing assessments, 
along with the revised cost and schedule evaluation, will be conducted 
prior to the decision to exercise the first production option. The 
program office's assessment is that there will be a stable and mature 
design, with a reliable manufacturing process, to proceed into 
operational unit production for this critical operational capability. 

[End of assessment] 

Gerald R. Ford Class Nuclear Aircraft Carrier (CVN 78): 

[Illustration: Source: U.S. Navy] 

The Navy's CVN 78 class of nuclear-powered aircraft carriers is 
designed to improve operational efficiency, enable higher sortie 
rates, and reduce manpower through the use of advanced propulsion, 
aircraft launch and recovery, and survivability technologies. The lead 
ship, CVN 78, was 70 percent complete at launch; however, its delivery 
is delayed until March 2016. Also, contract negotiations prompted the 
Navy to defer the construction contract for CVN 79 until early fiscal
year 2015. 

Concept: 
Program start (6/00). 

System development: 
Construction preparation contract award (5/04); 

Production: 
Production decision (7/07); 
Detail design and construction contract award (9/08); 
GAO review (1/14); 
Second ship contract award (12/14); 
Lead-ship delivery (3/16); 
Initial capability (3/17). 

Program Essentials: 
Prime contractor: Huntington Ingalls Industries; 
Program office: Washington, DC; 
Funding needed to complete:
R&D: $533.6 million; 
Procurement: $16,971.8 million; 
Total funding: $17,508.7 million; 
Procurement quantity: 1. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 04/2004: $5,051.9; 
Latest 08/2013: $4,867.4; 
Percent change: -3.7. 

Procurement cost: 
As of 04/2004: $32,363.3; 
Latest 08/2013: $31,081.1; 
Percent change: -4.0. 

Total program cost: 
As of 04/2004: $37,415.2; 
Latest 08/2013: $36,008.1; 
Percent change: -3.8. 

Program unit cost: 
As of 04/2004: $12,471.733; 
Latest 08/2013: $12,002.694; 
Percent change: -3.8. 

Total quantities: 
As of 04/2004: 3; 
Latest 08/2013: 3; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 04/2004: 137; 
Latest 08/2013: 155; 
Percent change: 13.1. 

The Navy awarded a construction contract for CVN 78 in September 2008 
when only 5 of the ship's 13 current critical technologies were mature 
and the ship's three-dimensional (3D) product model was incomplete. 
Since then, the lead ship's procurement costs have grown by over 22
percent, from $10.5 billion to $12.8 billion. At present, 7 of the 
currently planned technologies are mature, with the rest approaching 
maturity, and the ship's 3D product model is complete. However, 
maintaining design stability depends on currently immature 
technologies fitting within the space, weight, cooling, and power 
reservations allotted them within the ship. Construction to date
has been impeded by critical technology system delays, material 
shortages, and engineering challenges. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Complete three-dimensional product model: Knowledge attained; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

CVN 78 Program: 

Technology Maturity: 

According to the Navy, 7 of the 13 critical technologies for CVN 78 
are mature, and the remaining 6 are approaching maturity. To meet
required installation dates aboard CVN 78, the Navy produced several 
of these technologies, such as the volume search radar (VSR), prior to 
demonstrating their maturity—a strategy GAO's prior work has shown 
introduces risk of late and costly design changes and rework. The VSR 
is a component of the dual band radar (DBR), which has been delivered 
to CVN 78, and is undergoing design modifications needed to complete 
shipboard integration. According to the Navy, testing in the spring of 
2015 will show whether these modifications were successful or a more 
extensive redesign of the system is required, which could delay DBR 
deliveries by up to 4 years. Deficiencies affecting water twister 
components—used to absorb energy when arresting aircraft—of the 
advanced arresting gear (AAG) technology continue to disrupt the 
system's development. Recent water twister redesign proved 
unsuccessful in testing last year. The Navy resolved problems with the 
redesign and is planning for concurrent testing. Despite these
steps, the Navy forecasts AAG land-based testing to be complete in 
August 2016—a new delay of nearly two years—and after the Navy has 
accepted CVN 78 delivery. The electromagnetic aircraft launch system 
(EMALS) has successfully launched aircraft during land-based testing 
using a single launcher and four motor generators. The shipboard 
system will employ a more complex configuration with more launchers 
and generators sharing a power interface. 

Design Maturity: 

CVN 78 completed its 3D product model in November 2009—over a year 
after the construction contract award. While the model is now considered
functionally complete, maintaining design stability depends on 
technologies fitting within the space, weight, cooling, and power 
reservations allotted them. Shipboard testing may reveal a need for
design changes. Also, as construction progresses, the shipbuilder is 
discovering "first-of-class" type design changes, which it is using to 
update the model prior to CVN 79 construction. 

Production Maturity: 

According to program officials, CVN 78 is approximately 70 percent 
complete. Lead ship procurement costs for the lead ship have grown by 
over 22 percent since construction authorization in fiscal year 2008 
due in part to problems encountered in construction. Out-of-sequence 
work driven largely by material shortfalls, engineering challenges, 
and delays developing and installing certain critical technologies the 
Navy provides to the shipbuilder for installation has affected 
construction progress. 

Other Program Issues: 

The Navy deferred award of the CVN 79 detail design and construction 
contract from late fiscal year 2013 to the first quarter of fiscal 
year 2015. According to the Navy, continuing contract negotiations 
provide an opportunity to incorporate process improvements into 
construction plans. The Navy has undertaken an in-depth review of CVN 79
requirements and capabilities to identify cost trades, which it hopes 
can facilitate an agreement on contract terms. These actions are 
consistent with recommendations we made in September 2013 to defer the 
CVN 79 construction contract and to conduct a cost-benefit analysis on 
Ford-class capability requirements and the time and money needed to 
field systems to provide these capabilities. 

Program Office Comments: 

According to the program office, CVN 78 displaced 77,000 tons and was 
70 percent complete at launch—the highest levels achieved in aircraft
carrier new construction. The program office also reported that labor 
inefficiencies during ship erection are past and the principal risk 
remaining is in shipboard testing. Concerns over system integration 
within platform space, weight, and power reservations have been 
resolved. Land based testing for EMALS and DBR has progressed enough 
that program officials do not anticipate significant redesign. 
Further, the AAG test schedule remains on track to support ship 
delivery and sea trials. Lastly, the Navy plans to modify the CVN 79
construction preparation contract to extend the terms of the contract 
and avoid a production break during negotiations on the detail design 
and construction contract without delaying ship delivery. Program 
officials also provided technical comments that were incorporated 
where deemed appropriate. 

[End of assessment] 

Global Positioning System III (GPS III): 

[Illustration: Source: U.S. Air Force] 

The Air Force's Global Positioning System III (GPS III) program plans 
to develop and field a new generation of satellites to supplement and
eventually replace GPS satellites currently in use. Other programs are 
developing the ground system and user equipment. GPS III is to be 
developed incrementally. We assessed the first increment, which 
intends to provide capabilities such as a stronger military navigation 
signal to improve jamming resistance and a new civilian signal that 
will be interoperable with foreign satellite navigation systems. 

Concept: 

System development: 
Development start (5/08); 
Design review (8/10). 

Production: 
Production decision (1/11); 
GAO review (1/14); 
First satellite available for launch (4/16); 
Start operational test (TBD); 
Initial capability (TBD). 

Program Essentials: 
Prime contractor: Lockheed Martin; 
Program office: El Segundo, CA; 
Funding needed to complete:
R&D: $261.2 million; 
Procurement: $495.4 million; 
Total funding: $756.6 million; 
Procurement quantity: 2. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 05/2008: $2,654.8; 
Latest 11/2013: $2,795.0; 
Percent change: 5.3. 

Procurement cost: 
As of 05/2008: $1,490.5; 
Latest 11/2013: $1,581.5; 
Percent change: 6.1. 

Total program cost: 
As of 05/2008: $4,145.4; 
Latest 11/2013: $4,376.5; 
Percent change: 5.6. 

Program unit cost: 
As of 05/2008: $518.169; 
Latest 11/2013: $547.059; 
Percent change: 5.6. 

Total quantities: 
As of 05/2008: 8; 
Latest 11/2013: 8; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 05/2008: NA; 
Latest 11/2013: NA; 
Percent change: NA. 

We could not calculate acquisition cycle times for the first increment 
of the GPS III program because initial operational capability will not 
occur until satellites from a future increment are fielded. 

The GPS III program's eight critical technologies have been assessed 
as mature, but three have yet to complete qualification testing. The 
program reported that its design and production processes are 
currently mature and a prototype was constructed to reduce risk. 
However, design changes have been required due to issues identified in 
testing. Late hardware delivery resulted in delayed testing of the 
prototype. The GPS III program delayed the first space vehicle's
availability for launch from April 2014 to April 2016—a 24 month delay—
due to late hardware deliveries and technical problems identified in
testing. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Not applicable; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
attained; 
* Test a production-representative prototype: Knowledge not attained. 

GPS III Program: 

Technology and Design Maturity: 

The program office reports that all eight of its critical technologies 
are mature and that its design is stable. Three of the GPS III 
critical technologies, including the timekeeping system and the key GPS
signal generator, have not yet completed qualification testing, which 
is behind schedule. Based on the number of design drawings released
to manufacturing, the design has been mature since the program's 2010 
design review. However, design changes have been required due to 
problems identified in testing of key components. The program office 
reported that it has demonstrated that the design can meet 
requirements by testing a system-level integrated prototype that 
includes all key subsystems and components just with less redundancy 
in the GPS III satellites. 

Production Maturity: 

At the time of GPS III's production decision, the program office 
reported a level of manufacturing process maturity that indicated its 
processes were in control and production could begin. However, a
complete GPS III satellite was not tested prior to the production 
decision nor has one been tested to date. To mitigate risk, the 
program developed a prototype to prove out production processes prior to
integrating and testing the first space vehicle. Delivery of the 
prototype's navigation payload was delayed by a year, which the 
program office acknowledged resulted in some concurrency in
developing and integrating the prototype and the first space vehicle. 
Program officials stated that the prototype helped the program 
identify problems and reduce assembly time required for the first space
vehicle. 

Other Program Issues: 

The program office recently moved its estimate for the first space 
vehicle's available for launch date from April 2014 to April 2016—a 24 
month delay. This delay was in part driven by late hardware deliveries 
and multiple technical problems identified in testing, which have also 
negatively affected costs. The program office stated that the navigation
payload for the first GPS satellite was delivered over a year late. 
The program is still working to address technical problems associated 
with the mission data unit, the brain of the GPS III navigation 
mission. Testing revealed radio frequency isolation issues, which can 
result in signal degradation. 

This delay more closely aligns the space vehicle's delivery with the 
availability of GPS III's ground system, GPS Operational Control 
Segment (OCX). The synchronization of GPS III's and OCX's schedules 
continues to be a risk. GPS III satellites cannot be integrated into 
the constellation or be considered operational until OCX Block 1 is
delivered, which is planned for October 2016. 

The program is considering dual launching GPS III satellites, 
potentially beginning as early as the fifth GPS III space vehicle. Our 
prior work has shown that design changes during production can have 
significant cost and schedule consequences, including expensive 
retrofitting and production delays. 

Program Office Comments: 

The Air Force also provided technical comments, which were 
incorporated where deemed appropriate. 

[End of assessment] 

Ground/Air Task Oriented Radar (G/ATOR): 

[Illustration: Source: U.S. Marine Corps] 

The Marine Corps' Ground/Air Task Oriented Radar (G/ATOR) is an active 
electronic scanned array three-dimensional short/medium range multi-role
radar designed to detect cruise missiles, air breathing targets, 
rockets, mortars, and artillery. It replaces five different legacy 
radars. G/ATOR is a block acquisition; later blocks are mostly software
upgrades. According to the program office, developmental testing 
concluded in August 2013, and a low-rate production decision took 
place in January 2014, followed by a March 2014 contract award. 

Concept: 

System development: 
Development start (8/05); 
Design review (3/09); 
GAO review (1/14). 

Production: 
Low-rate decision (1/14); 
Start operational test (2/16); 
Full-rate decision (9/16); 
Initial capability (9/16). 

Program Essentials: 
Prime contractor: Northrop Grumman; 
Program office: Quantico, VA; 
Funding needed to complete:
R&D: $285.9 million; 
Procurement: $2,089.4 million; 
Total funding: $2,381.5 million; 
Procurement quantity: 55. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 08/2005: $372.4; 
Latest 09/2013: $981.1; 
Percent change: 163.5. 

Procurement cost: 
As of 08/2005: $1,169.3; 
Latest 09/2013: $1,668.7; 
Percent change: 42.7. 

Total program cost: 
As of 08/2005: $1,541.7; 
Latest 09/2013: $2,656.1; 
Percent change: 72.3. 

Program unit cost: 
As of 08/2005: $24.089; 
Latest 09/2013: $46.597; 
Percent change: 93.4. 

Total quantities: 
As of 08/2005: 64; 
Latest 09/2013: 57; 
Percent change: -10.9. 

Acquisition cycle time (months): 
As of 08/2005: 66; 
Latest 09/2013: 133; 
Percent change: 101.5. 

The G/ATOR technologies are mature and its design is stable and 
demonstrated but its production processes are not yet mature. In 
addition, the program's reliability is beneath the value needed to 
meet requirements due to software issues. To address this shortfall, the
program plans to develop and incorporate software fixes into low-rate 
initial production. There may be insufficient time to test all fixes 
prior to the start of production. Production processes were 
demonstrated on a pilot production line, but they did not demonstrate 
stable, adequate control. The program office intends to award a 
contract for four low-rate production systems in March 2014. According 
to the program office, these systems are needed to conduct operational
and environmental testing in order to meet the initial operational 
capability. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge not 
attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
attained; 
* Test a production-representative prototype: Knowledge attained. 

G/ATOR Program: 

Technology Maturity: 

All six G/ATOR critical technologies are fully mature. However, 
according to the program office, testing revealed issues with the 
radar's software causing it to require a reboot more frequently than 
anticipated. The problems are driven by a number of lower-level
software issues with system startup, random crashes, operator control 
console freezes, and an unstable command and control interface. The 
G/ATOR program office has put together a plan to incorporate software 
fixes to correct system start up and prevent crashes. Some hardware 
alterations may be required. The program office plans to increase and 
improve system performance by upgrading the software integration lab 
to support accelerated testing and conducting field testing with users 
every six months to demonstrate reliability growth and operational 
relevance. In addition, the gallium nitride technology, which will be 
used to upgrade the radar's transmit and receiving modules, is 
maturing on schedule. This new semi-conductor technology is expected 
to achieve better performance at a lower cost and will be installed on
the last low-rate production lot. 

Design Maturity: 

According to the program office, the G/ATOR design is mature, with 100 
percent of design drawings released and testing of system-level 
prototypes completed in August 2013, well after the critical design 
review but before the program enters production. Risk of additional 
design changes exists, due to modifications planned for the production 
units. If these modifications are not incorporated into the design and 
tested before beginning production, there may be schedule delays if 
the program chooses to continue production and retrofit systems at a 
later date. 

Production Maturity: 

According to the program office, the G/ATOR production readiness 
review was completed in September 2013 and the program demonstrated 
that its manufacturing processes meet DOD's requirement for the start 
of low-rate production. However, the manufacturing readiness level does
not indicate that its production processes are stable and in control 
as preferred by commercial best practices. The program plans to begin 
low-rate production with four systems in March 2014. According to 
program officials, these systems are needed to conduct developmental, 
operational, and environmental qualification testing in order to meet
the scheduled Block I initial operational capability. 

Other Program Issues: 

The program is authorized to procure 57 G/ATOR systems; however, only 
45 were funded in the fiscal year 2014 President's budget. According 
to the program office, the 12 unfunded G/ATOR systems will require 
funding by fiscal year 2016 in order to meet initial operational 
capability. In addition, the concurrent development and production of 
G/ATOR may be adversely affected by personnel shortages caused, in 
part, by the impending retirement of highly experienced acquisition 
workforce staff. 

Program Office Comments In commenting on a draft of this assessment, the
program office noted that in October 2011, G/ATOR's performance 
requirements were revised, which resulted in a re-designation of the 
program to a major defense acquisition program. At that time, cost 
estimates were rebaselined; since then G/ATOR has remained on schedule 
and its total estimated cost decreased. This reduction is due, in
part, from implementing better buying power and should cost 
initiatives. Technical comments were provided by the program office, 
which were incoporated where deemed appropriate. 

[End of assessment] 

Integrated Air and Missile Defense (IAMD): 

[Illustration: Source: Northrop Grumman] 

The Army's Integrated Air and Missile Defense (IAMD) program is being 
developed to network sensors, weapons, and a common battle command
system across an integrated fire control network to support the 
engagement of air and missile threats. The IAMD Battle Command System 
(IBCS) will provide a capability to control and manage IAMD sensors 
and weapons, such as the Sentinel radar and Patriot launcher and 
radar, through an interface module that supplies battle management 
data and enables networked operations. 

Concept: 
Technology development start (2/06). 

System development: 
Development start (12/09); 
Design review (5/12); 
GAO review (1/14). 

Production: 
Low-rate decision (6/15); 
Initial capability (9/16); 
Full-rate decision (7/17). 

Program Essentials: 
Prime contractor: Northrop Grumman Space & Mission Systems Corp,
Raytheon Integrated Defense Systems; 
Program office: Huntsville, AL; 
Funding needed to complete: 
R&D: $1,188.0 million; 
Procurement: $3,399.0 million; 
Total funding: $4,587.0 million; 
Procurement quantity: 431. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 12/2009: $1,677.7; 
Latest 12/2012: $2,405.0; 
Percent change: 43.4. 

Procurement cost: 
As of 12/2009: $3,611.0; 
Latest 12/2012: $3,399.0; 
Percent change: -5.9. 

Total program cost: 
As of 12/2009: $5,288.7; 
Latest 12/2012: $5,804.0; 
Percent change: 9.7. 

Program unit cost: 
As of 12/2009: $17.867; 
Latest 12/2012: $12.984; 
Percent change: -27.3. 

Total quantities: 
As of 12/2009: 296; 
Latest 12/2012: 447; 
Percent change: 51.0. 

Acquisition cycle time (months): 
As of 12/2009: 80; 
Latest 12/2012: 81; 
Percent change: 1.2. 

IAMD completed its critical design review in May 2012 with a stable 
design and technologies nearing full maturity, but does not plan to
demonstrate the design can perform as expected until February 2014. 
IAMD's mission has not changed, but changes to its plans for integrating
with other systems has significantly increased the size of its 
software effort, delayed its subsystem design reviews and increased 
development costs by over $717 million. These changes include adding 
Patriot launcher and radar functionality directly onto the integrated 
fire control network and increasing the number of units by 146 to 431
total units. WIN-T integration is also a significant risk. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

IAMD Program: 

Technology Maturity: 

Program officials estimate that IAMD technologies will not be fully 
mature until its planned production decision in 2015. The IAMD program 
entered system development in December 2009 with its four critical 
technologies—integrated battle command, integrated defense design, 
integrated fire control network, and distributed track management—
nearing maturity, according to an Army technology readiness assessment 
based on a notional design. The Army updated the technology readiness
assessment in March 2011 based on the winning contractor's design and 
reached the same conclusion about the technologies' maturity. The
Office of the Assistant Secretary of Defense for Research and 
Engineering concurred with the assessment, but noted that integration 
with the Warfighter Information Network-Tactical (WIN-T) is a 
significant risk. It also noted that the assessment was based on 
modeling and simulations of WIN-T and assumptions about performance. 
As a result, it recommended realistic, full-scale testing with WIN-T
prior to a production decision. 

Design Maturity: 

While the IAMD program has released nearly all of its total expected 
drawings and held a system level design review in May 2012, software 
problems and the Army's decision to operationalize the 32nd Test 
Battalion could cause further schedule delays and add substantial 
costs. For example, as a result of software development problems 
associated with the integrated battle command system, the IAMD
program realigned software deliveries with key test activities. The 
revised software plan was approved in April 2013, resulting in a 
program delay of four months. Failure to properly develop, test, and
integrate software could result in delay of capabilities being fielded 
to the warfigther. Also, the operationalization of the Patriot Test 
Battalion removes over 50 percent of the resources for both the 
Patriot and IAMD test programs. The IAMD and Patriot programs are 
working with the Army's test group to consider several options to 
mitigate potential risks, including delaying all test activities
until Patriot test activities are complete and conducting tests with 
fewer assets. Further, tests of a fully integrated system-level 
prototype are not expected to begin until February 2014, over 20
months after design review. 

Other Program Issues: 

IAMD's development costs have risen by about 48 percent, or over $717 
million, since beginning development and may increase further. The Army
restructured the program in 2011 to incorporate the Patriot launchers 
and radars directly on the integrated fire control network and to 
increase the number of units procured from 285 to 431 to account for 
adjustments to the battalion force structure and accelerating the 
fielding of capabilities. However, overall procurement costs have 
decreased by $194 million. According to program officials, increasing 
the number of units will provide for a common command and control at all
organizational levels. Program officials estimate the size of the 
software development effort at over 6.6 million lines of code—a 37 
percent increase over the estimate at development start. In addition, 
about 63 percent of this code will be newly developed code or auto-
generated code which requires less effort to develop than newly 
developed or modified code. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office noted 
that since the software replan in early 2013, deliveries of software 
have been on schedule allowing for successful demonstration of the 
IAMD hardware/software architecture in late 2013 to the user. This 
demonstration also served as risk mitigation for early integration 
leading up to the developmental test program and limited user test in
fiscal year 2014 and fiscal year 2015. Active risk plans are in place 
to manage program risks and the program office continues to work with 
other programs which IAMD is dependent on to ensure technical and 
programmatic risks are managed properly across programs. The loss of 
the test battalion will potentially result in some changes to
the IAMD test program, but those changes are actively being worked 
with all stakeholders. Currently, it does not appear this resource 
challenge will affect IAMD's schedule. All program changes depicted in 
this report are captured in appropriate acquisition decision 
memorandums and the program's acquisition program baseline. The
program office also provided technical comments which were 
incorporated where deemed appropriate. 

[End of assessment] 

Joint Air-to-Surface Standoff Missile Extended Range (JASSM-ER): 

[Illustration: Source: U.S. Air Force] 

The Air Force's JASSM-ER program plans to field a next-generation 
cruise missile capable of destroying the enemy's war-sustaining 
capability from outside its air defenses. JASSM-ER missiles are low-
observable, subsonic, and have a range of greater than 500 miles. They 
provide both fighter and bomber crews the ability to strike heavily 
defended targets early in a campaign. JASSM-ER is a follow-on program 
to the JASSM baseline program. The two missiles' hardware is 70 
percent common and their software is 95 percent common. 

Concept: 
Program start (6/96). 

System development: 
Development start (6/03); 
Design review (2/05). 

Production: 
Low-rate decision (1/11); 
End operational test (10/12); 
GAO review (1/14); 
Required assets available (4/14); 
Full-rate decision (6/14). 

Program Essentials: 
Prime contractor: Lockheed Martin; 
Program office: Eglin AFB, FL; 
Funding needed to complete:
R&D: $25.1 million; 
Procurement: $3,468.3 million; 
Total funding: $3,493.4 million; 
Procurement quantity: 2,847. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 04/2011: $286.8; 
Latest 08/2013: $253.6; 
Percent change: -11.6. 

Procurement cost: 
As of 04/2011: $3,636.3; 
Latest 08/2013: $3,670.3; 
Percent change: 0.9. 

Total program cost: 
As of 04/2011: $3,923.1; 
Latest 08/2013: $3,923.9; 
Percent change: 0.0. 

Program unit cost: 
As of 04/2011: $1.550; 
Latest 08/2013: $1.318; 
Percent change: -15.0. 

Total quantities: 
As of 04/2011: 2,531; 
Latest 08/2013: 2,978; 
Percent change: 17.7. 

Acquisition cycle time (months): 
As of 04/2011: NA; 
Latest 08/2013: 130; 
Percent change: NA. 

The JASSM-ER program has experienced production issues that have 
resulted in delays to the full-rate production decision and may delay
the deliveries required to provide for initial availability. The 
program has yet to accept any ER missile deliveries due to these 
production issues. Although significant, production issues are 
primarily limited to the new ER missile engine, as the rest of 
baseline and ER missile production has generally proceeded on schedule.
Sequestration cuts for fiscal year 2013 have resulted in the Air Force 
deferring some missile purchases beyond fiscal year 2017, expanded
obsolescence risk, and caused an increase in unfunded requirements. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Information not available. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Information not 
available; 
* Demonstrate critical processes on a pilot production line: Knowledge 
attained; 
* Test a production-representative prototype: Knowledge attained. 

JASSM-ER Program: 

Technology Maturity: 

According to the program office, JASSM-ER's five critical technologies—
the engine lube system, engine system, fuze, low observable features, 
and global positioning system—are mature and have been tested in a 
realistic environment using a production-representative test missile. 

Design Maturity: 

JASSM-ER's design is currently stable and has been successfully 
demonstrated in operational tests. According to the program office, 
the number of configuration changes has decreased over time with only 
one significant design change in the last three years. 

Production Maturity: 

The full-rate production decision for JASSM-ER has been delayed due to 
production issues which may also delay initial availability for the 
assets required. The program has yet to accept any ER missile
deliveries because of these production issues. 

The most significant of these issues is with the engine lubrication 
pump. Program officials stated they found that for some of the engine 
pumps produced, the internal metal components within the pump were 
chafing, releasing metal into the lubrication that could reduce 
performance. The program plans to change the component design and
implement changes during production ramp up while relying on the 
current design and production line screening to remove faulty pumps in 
low-rate production. Also, the program experienced a supplier issue 
with the fuel control unit—an engine component that controls the fuel 
throttle, affecting missile speed and acceleration. They discovered 
the component supplier had used diluted glue which was weaker than 
what had been used during component qualification testing. Program 
officials stated all 30 of the first ER missiles produced are 
potentially affected and they placed a hold on accepting ER missile 
deliveries until an agreement is reached with Lockheed Martin on how 
to address those missiles. 

Aside from engine lube pump and fuel control unit issues, the program 
states production of the remaining 98 percent of ER subsystems and
components have generally proceeded according to schedule. Production 
of the JASSM baseline variant has also largely been unaffected by ER 
production issues. Production of Lot 10 baseline missiles began in 
September 2013 with missile deliveries expected to begin in January 
2014 while start of low-rate production of the second lot of ER missiles
was delayed until January 2014. 

Other Program Issues: 

According to the program office, sequestration cuts for fiscal year 
2013 have resulted in the Air Force deferring some JASSM purchases to 
the out-years, increasing obsolescence risk, and increasing unfunded 
requirements. Prior to sequestration cuts, the program planned to 
reach its economic order quantity of 360 missiles per year in fiscal 
year 2016 but now plans to purchase missiles at the minimum 
sustainment rate for the foreseeable future. The program has some 
obsolescence issues that are not funded because of sequestration cuts,
according to the program, which could lead to production gaps. Also, 
the program maintains sequestration cuts have resulted in unfunded 
requirements, such as warranties for upcoming missile purchases, 
production tooling for full rate production ramp up, and some 
evaluation testing. 

Program Office Comments: 

In commenting on a draft of this assessment, the Air Force provided 
technical comments, which were incorporated where deemed appropriate. 

[End of assessment] 

Joint Light Tactical Vehicle (JLTV): 

[Illustration: Sources: JPO JLTV EMD Industry Contractors (AM General, 
Oshkosh Corp. & Lockheed Martin)] 

The Army and Marine Corps' JLTV is a family of vehicles being 
developed to replace the High Mobility Multipurpose Wheeled Vehicle 
(HMMWV) for some missions. The JLTV is expected to provide better 
protection for passengers against current and future battlefield 
threats, increased payload capacity, and improved automotive performance
over the up-armored HMMWV; it must also be transportable. Two- and 
four-seat variants are planned with multiple mission configurations. 

Concept: 
Program start (12/07). 

System development: 
Development start (8/12); 
Design review (1/13); 
GAO review (1/14). 

Production: 
Low-rate decision (7/15); 
Start operational test (3/17); 
Full-rate decision (2/18); 
Initial capability (5/18). 

Program Essentials: 
Prime contractor: AM General, Lockheed Martin, Oshkosh; 
Program office: Harrison Township, MI; 
Funding needed to complete:
R&D: $377.3 million; 
Procurement: $22,651.7 million; 
Total funding: $23,046.9 million; 
Procurement quantity: 54,599. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 10/2012: $1,001.1; 
Latest 07/2013: $981.0; 
Percent change: -2.0. 

Procurement cost: 
As of 10/2012: $22,661.3; 
Latest 07/2013: $22,651.7; 
Percent change: 0.0. 

Total program cost: 
As of 10/2012: $23,699.8; 
Latest 07/2013: $23,650.5; 
Percent change: -0.2. 

Program unit cost: 
As of 10/2012: $0.433; 
Latest 07/2013: $0.432; 
Percent change: -0.2. 

Total quantities: 
As of 10/2012: 54,730; 
Latest 07/2013: 54,730; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 10/2012: 125; 
Latest 07/2013: 125; 
Percent change: 0.0. 

JLTV's two critical technologies have been demonstrated in a realistic 
environment on prototype vehicles, according to program officials. In 
lieu of a critical design review, the program held a design 
understanding review in January 2013, and according to program 
documents, confirmed that all three contractors had more than 90
percent of design files under configuration control. A recent 
manufacturing readiness assessment concluded that all three vendors 
were on track to achieve production maturity by low-rate initial
production. All variants are envisioned to meet transportability 
requirements, and testing is ongoing to confirm this with production 
representative versions. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Information not 
available; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

JLTV Program: 

Technology Maturity: 

According to the program office, its critical technologies—underbelly 
protection armor and side-kit armor—are fully mature. According to
program officials, ballistic testing conducted since November 2012—
including armor samples, vehicle cabs, and chassis—confirmed this, and 
both technologies have been demonstrated in fielded systems. However, 
integrating the technologies to meet all system-level requirements for
transportability, protection, and mobility could prove challenging. 

Design Maturity: 

The program office did not hold a formal critical design review for 
JLTV, but conducted design understanding reviews with contractors 
between December 2012 and January 2013. According to program 
officials, these reviews were at a level of detail similar to a 
critical design review and were held to support the requirement for 
mature vehicle designs at the time of contract award for system
development. At the time of these reviews, all long-lead and critical 
designs had been completed and all three contractors had more than 90 
percent of the design files under configuration control. The Office of 
the Deputy Assistant Secretary of Defense (Systems Engineering) 
affirmed that the exit criteria for system development had been 
satisfied. According to program documentation, contractors will 
maintain responsibility for configuration control and will inform the 
government of changes. The government will assume control of the 
design after the planned award of one low-rate initial production
contract in 2015. 

Production Maturity: 

The Army does not intend to use process capability index data to 
assess production maturity, as recommended by our best practices. 
Instead, it intends to use other metrics, such as predicted assembly 
times and feasibility studies to assess production maturity by the 
production readiness review, scheduled for September 2014. The program 
recently conducted a manufacturing readiness assessment with all three 
vendors to evaluate manufacturing readiness, including a self-
assessment of manufacturing readiness levels by the vendors. The 
program office believes all three vendors are on track to be 
production capable by low-rate initial production contract award in 
2015. Production processes are not expected to be fully in control as 
program officials noted that tooling will not be fully documented 
until this point due to the large capital investment required. 

Other Program Issues: 

On the basis of the knowledge gained from the technology development 
phase, the Army and Marine Corps concluded the JLTV could not meet
requirements for both protection levels and transportability because 
of weight and relaxed the requirement to transport the vehicle by 
helicopter at high altitude and at certain temperatures. Program
officials acknowledge some risk still exists in vehicles achieving 
relaxed weight requirements, but the prototype weigh-ins were on 
track, thus diminishing risk. Prototype vehicle testing will continue 
through October 2014, and the results will be used to determine 
whether the vehicles meet system requirements. Army officials 
recognize that the test schedule is compressed, and that slips in
the limited user test could result in a slip of the program's 
production decision planned for July 2015. However, program officials 
believe that the results of testing will be available in sufficient 
time. 

At the end of the system development phase, a low-rate initial 
production contract will be awarded to a single source. The program 
office will seek approval to limit competition to the three current 
vendors, but if not approved will revert to a full and open 
competition strategy. The program office does not believe there are 
any viable sources for JLTV production other than the three current 
vendors. 

Finally, the Army plans to begin procuring JLTV while simultaneously 
procuring the Armored Multi-Purpose Vehicle. The simultaneous 
procurement of these programs is expected to continue for a
decade or more. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office 
provided technical comments, which were incorporated where deemed 
appropriate. 

[End of assessment] 

Joint Precision Approach and Landing System Increment 1A (JPALS Inc 
1A): 

[Illustration: Source: U.S. Navy] 

JPALS Increment 1 is a Navy-led program to develop a GPS-based 
aircraft landing system to replace current radar-based systems on its 
ships. It is designed to provide reliable precision approach and 
landing capability in adverse environmental conditions and improved 
interoperability. Increment 1A is the ship-based system and increment 
1B will integrate JPALS with sea-based aircraft. Both are needed to 
provide the full capability. We assessed increment 1A and made 
comments on increments 1B, 2, and other follow-on efforts. 

Concept: 

System development: 
Development start (7/08); 
Design review (12/10); 
GAO review (1/14). 

Production: 
Low-rate decision (TBD); 
Start operational test (1/16); 
Initial capability (7/16); 
Full-rate decision (8/16). 

Program Essentials: 
Prime contractor: Raytheon; 
Program office: Lexington Park, MD; 
Funding needed to complete:
R&D: $115.8 million; 
Procurement: $257.7 million; 
Total funding: $373.5 million; 
Procurement quantity: 27. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 07/2008: $833.1; 
Latest 09/2013: $859.3; 
Percent change: 3.1. 

Procurement cost: 
As of 07/2008: $224.3; 
Latest 09/2013: $257.7; 
Percent change: 14.9. 

Total program cost: 
As of 07/2008: $1,064.7; 
Latest 09/2013: $1,124.2; 
Percent change: 5.6. 

Program unit cost: 
As of 07/2008: $28.775; 
Latest 09/2013: $30.385; 
Percent change: 5.6. 

Total quantities: 
As of 07/2008: 37; 
Latest 09/2013: 37; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 07/2008: 75; 
Latest 09/2013: 96; 
Percent change: 28.0. 

JPALS Increment 1A's two critical technologies are mature and have 
been demonstrated in a realistic environment. Program officials reported
completing baseline software development as of April 2012. The program 
began system-level development testing in July 2012 and sea-based 
testing in December 2012. The program completed 108 integrated flight 
tests with no major anomalies reported. Increment 1A's production 
decision scheduled for November 2013 was canceled due to budget 
reductions, with a new date to be determined. Ship availability delays 
for installation and procurement changes resulted in schedule and cost 
breaches, respectively, of thresholds in the program's baseline. 
Increment 1B is scheduled to start system development in 2015. Lead 
responsibility for Increment 2, land-based JPALS, transferred from the 
Air Force to the Navy beginning in fiscal year 2014. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

JPALS Inc 1A Program: 

Technology Maturity: 

JPALS Increment 1A's two critical technologies are mature and have 
been demonstrated in a realistic environment. Program officials reported
demonstrating the technologies during sea-based flight testing in 
2013. JPALS functionality is primarily software-based, and the program 
reported that its software development and integration effort was 
complete as of April 2012. The program will continue developmental 
testing, with operational testing planned to begin in 2016. 

Design Maturity: 

The JPALS program held its critical design review in December 2010 and 
released all of its expected design drawings to manufacturing at that 
time. The JPALS design is currently stable, and the program began 
system-level development testing of a prototype in July 2012 to show 
that it will perform as expected. Sea-based testing began in December 
2012 and program officials reported completing 108 integrated flight 
tests as of July 2013, with no major anomalies identified. Shore-based 
auto-landing demonstrations began in October 2013, and program 
officials reported completing 70 ship-based auto-landing 
demonstrations as of November 2013. 

Production Maturity: 

According to JPALS program officials, the program has not identified 
any critical manufacturing processes and the system's hardware is 
comprised primarily of off-the-shelf components. The program has 
accepted delivery of all eight of its engineering development models, 
seven of which are production representative. 

Other Program Issues: 

The program's production decision, scheduled for November 2013, was 
canceled and a new date has yet to be determined. Program officials 
stated that budget reductions due to sequestration eliminated funding 
for the low-rate initial production contract. They noted that a new 
date will not be scheduled until the Navy resolves this funding issue. 
The program previously delayed the production decision from May 2013 
to November 2013 because the aircraft carrier needed to conduct ship-
based integrated testing was not available for installation. As a 
result, the program reported a schedule breach of the acquisition 
program baseline.The program also extended planned production to avoid 
acquiring systems earlier than needed and moved the purchase of one 
unit from development to procurement. These changes increased 
procurement costs and resulted in a cost breach of a threshold set in 
the acquisition baseline. 

System development for JPALS Increment 1B—which will integrate JPALS 
with sea-based aircraft—is scheduled for 2015. Program officials 
stated that increment 1B will be developed to provide JPALS 
functionality in a packaged way that allows for integration with any 
aircraft rather than tailoring efforts to each individual platform. 
Increment 2 is the land-based version of JPALS and system development 
is scheduled for 2015. Beginning with fiscal year 2014, lead service 
responsibility for JPALS Increment 2 transferred from the Air Force to
the Navy. 

Program officials stated that the recently conducted successful auto-
land demonstrations may allow for the incorporation of capabilities 
planned for future increments. Incorporating auto-land and unmanned 
aerial vehicle capabilities into increments 1A and 1B will provide 
enabling technology for the Navy's future ship classes and the 
Unmanned Carrier-Launched Surveillance and Strike program for which 
JPALS was selected as the primary landing system. 

Program Office Comments: 

In commenting on a draft of this assessment, the JPALS program office 
noted that it concurred with our review and that flight testing was 
highly successful and the system performed as intended with no 
significant design or performance issues identified to date. The 
program is working aggressively with the Navy and the Office of
Secretary of Defense to resolve the cost and schedule breaches, and 
anticipates corrective actions will be incorporated in the fiscal year 
2015 President's budget submission. The program office also provided 
technical comments, which were incorporated where deemed appropriate. 

[End of assessment] 

Joint Tactical Radio System Handheld, Manpack, and Small Form Fit 
Radios (JTRS HMS): 

[Illustration: Source: © 2012 General Dynamics C4S] 

DOD's JTRS program is developing software-defined radios that will 
interoperate with existing radios and increase communications and
networking capabilities. The JTRS HMS program is currently developing 
two radios: the Rifleman radio for unclassified use and the Manpack 
radio for use in a classified domain. A subset of the Manpack radios 
will be interoperable with the Mobile User Objective System (MUOS), a 
satellite communication system. 

Concept: 

System development: 
Program/development start (4/04). 

Production: 
Low-rate decision (6/11); 
Second low-rate decision—Rifleman radio (7/12); 
Second low-rate decision—Manpack radio (10/12); 
Third low-rate decision—Manpack radio (12/13); 
GAO review (1/14); 
Full-rate decision—Rifleman radio (3/15); 
Full-rate decision—Manpack radio (9/15). 

Program Essentials: 
Prime contractor: General Dynamics C4 Systems, Inc. 
Program office: Aberdeen Proving Ground, MD; 
Funding needed to complete:
R&D: $31.3 million; 
Procurement: $6,706.3 million; 
Total funding: $6,737.7 million; 
Procurement quantity: 236,240. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 05/2004: $572.9; 
Latest 09/2013: $1,255.8; 
Percent change: 119.2. 

Procurement cost: 
As of 05/2004: $9,984.0; 
Latest 09/2013: $7,680.2; 
Percent change: -23.1. 

Total program cost: 
As of 05/2004: $10,556.9; 
Latest 09/2013: $8,935.9; 
Percent change: -15.4. 

Program unit cost: 
As of 05/2004: $0.032; 
Latest 09/2013: $0.033; 
Percent change: 2.6. 

Total quantities: 
As of 05/2004: 328,674; 
Latest 09/2013: 271,202; 
Percent change: -17.5. 

Acquisition cycle time (months): 
As of 05/2004: 85; 
Latest 09/2013: 112; 
Percent change: 31.8. 

The JTRS HMS program continues to conduct operational testing on both 
the Rifleman and Manpack variants and has demonstrated full maturity 
of all technologies, but has not demonstrated its production 
processes. Program officials have taken steps to address the Manpack
reliability shortfalls identified during operational testing in May 
2012 and plan to demonstrate the radio's capabilities during follow-on 
testing in May 2014. Full-rate production decisions for both variants 
have been delayed to fiscal year 2015 because of a change in the 
program's acquisition strategy to allow new vendors to compete for the
contracts. In December 2013, the program received approval to increase 
the low-rate initial production quantity for the Manpack radio. The 
program is working with the Army to manage capability gaps resulting 
from both radios' full-rate production delays. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge not 
attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
not attained; 
* Test a production-representative prototype: Knowledge attained. 

JTRS HMS Program: 

Technology Maturity: 

According to a program official, JTRS HMS has fully demonstrated the 
maturity of all its critical technologies for both the Rifleman and 
Manpack radios. The program has conducted operational testing on both 
variants for over four years, and plans to conduct additional testing 
in fiscal year 2014. 

Design Maturity: 

According to program officials, the designs of both variants are 
stable, but reliability issues for the Manpack radio could require 
design modifications. Following operational testing in May 2012, DOD 
test officials reported that the Manpack was not operationally 
effective or suitable because it failed to demonstrate a reliability 
requirement. Program officials said they have taken steps to address the
Manpack's reliability shortfalls and plan to demonstrate all remaining 
capabilities during follow-on testing in May 2014. 

Production Maturity: 

According to JTRS HMS officials, the program's manufacturing readiness 
is at a level consistent with DOD guidance, but not yet at a level that
demonstrates that its critical manufacturing processes are in control. 

Other Program Issues: 

Both variants of JTRS HMS have experienced additional schedule slips 
since last year's assessment. The program revised its acquisition 
strategy following an Office of the Secretary of Defense directive 
that JTRS HMS conduct full and open competition for the full-rate 
contracts for both variants. As a result, the program office expects 
the full-rate production decisions for the Rifleman and Manpack radios 
to slip from the second half of fiscal year 2013 to March and 
September 2015, respectively. Prior to the full-rate production 
decisions, the program must solicit proposals from new vendors and, 
according to program officials, will likely award new contracts and 
test new radios. The Army would have to demonstrate that these new 
radios meet the Rifleman and Manpack requirements in an operationally-
realistic environment. This delay puts the program nearly three years 
behind the originally scheduled full-rate production decisions for the 
Rifleman radio in May 2012 and the Manpack radio in December 2012. The 
program manager said he is working with Army operations and resource 
management staff to manage capability gaps resulting from both radios'
full-rate production delays. They will establish deployment quantities 
and locations for the HMS radios procured through low-rate initial 
production to meet the Army's immediate needs. The program received 
approval for an additional lot of 1,500 Manpack radios in December 
2013, but has not received authorization to increase the low-rate 
initial production quantity for the Rifleman radio over the current 
level set by the Office of the Secretary of Defense in July 2012. 

Additionally, demonstrating the Manpack with the MUOS antenna and 
waveform remains a technical risk for the program. The JTRS HMS 
program is currently scheduled to field the MUOS-capable Manpack 
radios in 2014, but officials stated that they will wait to 
demonstrate the Manpack with the MUOS antenna and waveform until after 
the MUOS program successfully completes its own operational testing, 
which is scheduled for June 2014. 

Program Office Comments: 

In commenting on a draft of this assessment, program officials noted 
that in 2012, HMS early operational tests were conducted on low-rate 
initial production variants of the HMS Manpack radio. Since this test, 
numerous corrected deficiencies have been implemented, including 
production improvements and extended environmental stress screening, 
significant improvement has been documented in follow-on performance 
verification testing and will be formally demonstrated at the Network 
Integration Evaluation 14.2 in May 2014. HMS Rifleman and Manpack 
radios have been successfully fielded and are in use by operational
units in support of global operations. To meet operational needs, in 
December 2013, the Office of the Secretary of Defense approved an 
additional low-rate initial production allotment of HMS Manpack 
radios, while also indicating support for a multi-vendor, multi-award 
construct for HMS full rate production. 

[End of assessment] 

KC-46 Tanker Modernization Program (KC-46): 

[Illustration: Source: © 2011 Boeing. All rights reserved] 

The Air Force's KC-46 program plans to convert an aircraft designed 
for commercial use into an aerial refueling tanker in order to refuel 
Air Force, Navy, Marine Corps, and allied aircraft. The program is the
first of three planned phases to replace the Air Force's aging fleet 
of KC-135 aerial refueling tankers. The KC-46 has been designed to 
improve on the KC-135's refueling capacity, efficiency, capabilities 
for cargo and aeromedical evacuation, and to integrate defensive 
systems. 

Concept: 

System development: 
Development start (2/11); 
Critical design review (7/13); 
GAO review (1/14); 
KC-46 first flight (1/15). 

Production: 
Low-rate decision (8/15); 
Start operational test (5/16); 
Full-rate decision (6/17); 
Required assets available (8/17). 

Program Essentials: 
Prime contractor: Boeing; 
Program office: Wright-Patterson AFB, OH; 
Funding needed to complete:
R&D: $3,355.6 million; 
Procurement: $33,848.5 million; 
Total funding: $40,829.3 million; 
Procurement quantity: 175. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 02/2011: $7,206.3; 
Latest 12/2012: $7,045.5; 
Percent change: -2.2. 

Procurement cost: 
As of 02/2011: $34,992.9; 
Latest 12/2012: $33,848.5; 
Percent change: -3.3. 

Total program cost: 
As of 02/2011: $46,090.0; 
Latest 12/2012: $44,519.2; 
Percent change: -3.4. 

Program unit cost: 
As of 02/2011: $257.486; 
Latest 12/2012: $248.710; 
Percent change: -3.4. 

Total quantities: 
As of 02/2011: 179; 
Latest 12/2012: 179; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 02/2011: 78; 
Latest 12/2012: 78; 
Percent change: 0.0. 

The program held its critical design review in July 2013 with its 
critical technologies nearing full maturity and its design stable but 
not demonstrated. To reduce risk and improve schedule, Boeing decided 
to develop situational awareness software internally prior to the 
critical design review. This resulted in replacing one of the 
program's critical technologies and re-using software code. Boeing is 
currently manufacturing the four development aircraft, but test boom
production has been delayed by almost a year due to design changes and 
late parts. The program has demonstrated that it can produce the 
required military subsystems in a production representative 
environment, but these processes will not be in control by the low-
rate production decision. The Air Force and Boeing are working through 
software and hardware integration and flight test risks. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge not attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

KC-46 Program: 

Technology Maturity: 

The KC-46 entered system development with its critical technologies—a 
three-dimensional display to monitor and enable aerial refueling 
activities and a software module designed to increase situational
awareness—nearing full maturity, but not yet demonstrated in a 
realistic environment. In March 2013, almost four months before the 
program's critical design review, Boeing decided to develop the 
situational awareness software internally. Boeing's version of this 
development effort replaced the prior software modules with a new one. 
The new software module is nearing full maturity, but has not yet been 
demonstrated in a realistic environment. To reduce risk and improve 
schedule, Boeing re-used some of the situational awareness software
code from prior programs. The program plans to fully mature its 
critical technologies prior to its low-rate production decision. 

Design Maturity: 

The program held its critical design review in July 2013 with over 90 
percent of its design drawings releasable, but before fully maturing 
its technologies and testing an aircraft that integrates the military
sub-systems. The program will not begin testing an aircraft that 
integrates military sub-systems until January 2015, 18 months after 
its critical design review. Best practices call for completing a full
system-level prototype demonstration by the critical design review in 
order to show that the design is capable of meeting performance 
requirements. 

Production Maturity: 

Boeing has begun production of the four development aircraft, and is 
also manufacturing a test refueling boom and a boom for the first
development aircraft. Test refueling boom production has been delayed 
by almost a year due to design changes and late parts deliveries. Boeing
officials said the test refueling boom is a risk reduction effort and 
lessons learned will be applied to future boom builds. The program 
reported that it is primarily using manufacturing readiness levels to 
assess manufacturing risk. As of July 2013, the program demonstrated 
that it is capable of producing the applicable military subsystems, such
as several aerial refueling and defensive subsystems, in a production 
representative environment. The low-rate initial production decision 
is currently scheduled for August 2015, but the program will not have 
its production processes for military subsystems in control at that 
time as recommended by best practices. 

Other Program Issues: 

The Air Force has identified software and hardware integration and the 
aggressive nature of the KC-46 flight test schedule as top program 
risks. While most software and hardware integration has progressed
according to plan, these efforts have largely addressed commercial 
rather than military unique components to date, and some aerial 
refueling and avionics software has not been delivered on time. The 
flight test pace is more aggressive than other military aircraft 
development programs, and Boeing's test approach requires a significant
amount of coordination among key stakeholders. The program office and 
Boeing are working together to mitigate these risks by, for example, 
conducting dry runs prior to flight testing. 

Program Office Comments: 

In commenting on a draft of this assessment, the program stated they 
mitigated risk by negotiating the competitive fixed-price incentive 
development contract with firm-fixed and not-to exceed pricing for
production. The program noted that about 50 percent of the development 
work has been completed thus far and Boeing has met or exceeded all 
contractual requirements. The program is closely tracking software as 
a risk, however, it does not believe there are significant software-
related issues at this time. The program further stated that it plans 
to mitigate the risk posed by concurrency by ensuring that adequate 
testing is completed prior to the production decision. In addition, 
Boeing's contract requires it to incorporate fixes into production 
aircraft at no additional cost. DOD and the Air Force also provided 
technical comments, which were incorporated as appropriate. 

[End of assessment] 

LHA 6 America Class Amphibious Assault Ship (LHA 6): 

[Illustration: Source: Huntington Ingalls Industries] 

The Navy's LHA 6 class will replace the LHA 1 Tarawa class amphibious 
assault ships. LHA 6 class is based on the fielded LHD 8 and consists 
of three ships. The ships will feature enhanced aviation capabilities 
and are designed to support Marine Corps assets in an expeditionary 
strike group. LHA 6 construction began in December 2008 and ship
delivery is expected in March 2014. LHA 7 construction began in July 
2013 and delivery is expected in December 2018. The Navy intends to
award the construction contract for LHA 8 in fiscal year 2017. 

Concept: 
Program start (7/01). 

System development: 
Contract award (6/07); 

Production: 
Fabrication start (1/08); 
GAO review (1/14); 
Ship delivery (3/14); 
Start operational test (6/14); 
Initial capability (4/16). 

Program Essentials: 
Prime contractor: Huntington Ingalls Industries; 
Program office: Washington, DC; 
Funding needed to complete:
R&D: $75.6 million; 
Procurement: $3,570.5 million; 
Total funding: $3,647.2 million; 
Procurement quantity: 1. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 01/2006: $232.4; 
Latest 12/2012: $397.1; 
Percent change: 70.9. 

Procurement cost: 
As of 01/2006: $3,112.3; 
Latest 12/2012: $9,710.6; 
Percent change: 212.0. 

Total program cost: 
As of 01/2006: $3,344.6; 
Latest 12/2012: $10,109.7; 
Percent change: 202.3. 

Program unit cost: 
As of 01/2006: $3,344.647; 
Latest 12/2012: $3,369.910; 
Percent change: 0.8. 

Total quantities: 
As of 01/2006: 1; 
Latest 12/2012: 3; 
Percent change: 200.0. 

Acquisition cycle time (months): 
As of 01/2006: 146; 
Latest 12/2012: 177; 
Percent change: 21.2. 

LHA 6 began construction in December 2008 with mature technologies and 
a design that was only 65 percent complete. After a 19 month delay, the
Navy expects delivery will occur in March 2014. LHA 6 will also incur 
an estimated $42.4 million in cost growth due to post-delivery rework 
of the ship's deck to cope with Joint Strike Fighter exhaust and 
downwash. Construction of LHA 7 (which largely shares the LHA 6 
design) began in July 2013 and the program office believes that the
issues that led to cost increases and schedule delays on LHA 6 have 
been largely resolved and are unlikely to cause problems for LHA 7. 
Design changes to LHA 8 are more significant and include the addition 
of a well deck. The Navy plans to competitively award a construction 
contract for LHA 8 and has awarded contracts with two shipyards to 
assist with early design work. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge not 
attained; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

LHA 6 Program: 

Technology, Design, and Production Maturity: 

All LHA critical technologies were mature when the program awarded its 
construction contract in June 2007. Although not considered critical 
technologies, the program has identified an additional six key 
subsystems necessary to achieve capabilities. Five of these subsystems 
are mature. The sixth, the Joint Precision Approach and Landing 
System, is still in development, but LHA 6 can use backup aviation 
control systems to meet requirements. There are no new critical 
technologies expected for LHA 7 or LHA 8, but requirements for LHA 8 
are still in development. 

In January 2014, the Navy and the shipbuilder conducted acceptance 
trials on LHA 6 and Navy officials anticipate ship delivery will occur 
in March 2014, 19 months later than the contracted delivery date. At 
the time of acceptance trials, the LHA 6 design was at least 99 
percent complete and construction was over 97 percent complete. LHA 6
began construction in December 2008 with only 65 percent of its design 
complete, and subsequent design quality issues have caused more design
changes than anticipated and higher levels of rework. Following the 
delivery of LHA 6, the Navy will spend an estimated $42.4 million to 
reconfigure the ship's flight deck to cope with exhaust and downwash 
from the Joint Strike Fighter. 

Construction of LHA 7 (which largely shares the same design as LHA 6) 
began in July 2013 and flight deck modifications due to JSF are still 
being incorporated into the design. Officials, however, do not believe 
that this will interfere with the ship's construction. Other design 
changes to LHA 7 include a new firefighting system and updates to the
radar and the command, control, communications, computers, and 
intelligence systems. Design changes to LHA 8 will be more significant 
as the Navy will incorporate a well deck that can accommodate two 
landing craft. Program officials note that the new design also allows 
for better maintenance of aviation capabilities. The program may also 
incorporate a flexible infrastructure—which would allow compartments 
to be reconfigured to meet changing mission needs with less rework—
into some low risk areas of the LHA 8 design should the Navy determine 
that it results in lifecycle cost savings. 

Other Program Issues: 

Program officials believe that as a result of increasing the number of 
design drawing reviews and ensuring additional lead time for material 
orders on LHA 7, the program will not experience the high level of 
rework that led to cost growth and schedule delays during construction 
of LHA 6. In order to improve quality and shipyard performance on LHA
7, the Navy included contract incentives of up to $41 million; 
although officials note that it is too soon to determine whether the 
incentives are effective at keeping rework rates low. 

The Navy intends to competitively award a construction contract for 
LHA 8, and in November 2012 awarded early industry involvement contracts
to two shipbuilding contractors that it determined are capable of 
building the ship without major recapitalization. The contracts allow 
the shipbuilders to participate in early stage design work and 
investigate opportunities for potential cost reductions, and were 
recently modified to extend the period of performance past the past 
the original April 2014 contract expiration date. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office stated 
that based on the success of LHA 6's acceptance trials, the Navy's 
independent assessor—the Board of Inspection and Survey—recommended 
that the Navy accept delivery of the ship. The extension of the 
periods of performance of the early industry involvement
contracts for LHA 8 efforts will allow the joint industry/government 
team to continue working on identifying innovative ways to reduce the 
projected cost of the ship. The program office also provided technical 
comments, which were incorporated as appropriate. 

[End of assessment] 

Littoral Combat Ship (LCS): 

[Illustration: Sources: Lockheed Martin (left); General Dynamics 
(right)] 

The Navy's LCS is designed to perform mine countermeasures, 
antisubmarine warfare, and surface warfare missions. It consists of 
the ship itself, or seaframe, and the mission packages it deploys. The 
Navy bought the first four seaframes in two unique designs—one based 
on a steel semi-planing monohull (Freedom variant) and the other based 
on an aluminum trimaran hull (Independence variant)—and subsequently 
awarded a contract for a block buy of up to 10 ships to both 
contractors. We assessed both seaframe designs. 

Concept: 
Program start (9/02). 

System development: 
Development start (5/04). 

Production: 
Production decision (12/04 & 10/05); 
Lead-ship delivery (9/08 & 12/09); 
New baseline approved (2/11); 
GAO review (1/14); 
Start operational test (6/14 & 6/14); 
Initial capability (7/14). 

Program Essentials: 
Prime contractor: Austal USA, Lockheed Martin; 
Program office: Washington Navy Yard, DC; 
Funding needed to complete:
R&D: $704.1 million; 
Procurement: $18,775.1 million; 
Total funding: $19,631.6 million; 
Procurement quantity: 36. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 05/2004: $932.9; 
Latest 12/2012: $3,596.3; 
Percent change: 285.5. 

Procurement cost: 
As of 05/2004: $496.0; 
Latest 12/2012: $26,214.6; 
Percent change: 5,185.2. 

Total program cost: 
As of 05/2004: $1,428.9; 
Latest 12/2012: $30,027.0; 
Percent change: 2,001.4. 

Program unit cost: 
As of 05/2004: $357.225; 
Latest 12/2012: $577.442; 
Percent change: 61.6. 

Total quantities: 
As of 05/2004: 4; 
Latest 12/2012: 52; 
Percent change: 1,200.0. 

Acquisition cycle time (months) 
As of 05/2004: 41; 
Latest 12/2012: 122; 
Percent change: 197.6. 

Cost data are for the seaframe only. Research and development funding 
includes detail design and construction of two ships. DOD recently 
announced plans to reduce total seaframe quantities to 32. 

The LCS seaframe program has demonstrated the maturity of 16 of its 18 
critical technologies and continues to make design and production
process changes. Additional design changes have been endorsed by the 
LCS Council for fiscal year 2015: bridge wings and a seven-meter rigid
hull inflatable boat for the Independence variant and stronger stern 
ramp for the Freedom variant. The Navy accepted delivery of LCS 4 in
September 2013, a delay of 6 months, and is in steady production with 
12 hulls under contract and/or construction. The next block-buy is
scheduled for fiscal year 2016, when 24 seaframes will already be 
delivered, constructed, or under contract. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

LCS Program: 

Technology Maturity: 

Sixteen of the 18 critical technologies for both LCS designs are 
mature and have been demonstrated in a realistic environment. The two 
remaining technologies—LCS 1's overhead launch and retrieval system 
and LCS 2's aluminum structure are nearing maturity—according to our 
best practice standards. Though program officials believe that LCS 2's 
aluminum structure hull is mature as the ship is operational, there 
are still unknowns related to the hull structure. As a result, full 
maturity will not be demonstrated until the completion of shock and 
survivability trials to validate survivability and the ship's ability 
to achieve a 20-year service life. These tests are not expected to 
begin until August 2015. 

Design and Production Maturity: 

The Navy started construction of LCS 1 and 2 without a stable design 
and has had to incorporate design changes on follow-on seaframes. LCS 
1 and LCS 2 are still undergoing testing, and the Navy is 
incorporating design fixes for identified deficiencies into the 
designs of follow-on ships. In addition, a series of additional design 
changes for both variants have been approved by the LCS Council for 
fiscal year 2015; including bridge wings and a seven-meter rigid hull 
inflatable boat for the Independence variant and stronger stern ramp 
for the Freedom variant. LCS 4 experienced delays and was delivered 
six months after its expected contract delivery date of March 2013. 
LCS 5 through LCS 12 are currently in various stages of construction. 
The Navy is concerned about both contractors' ability to meet 
construction schedules without impacting follow-on hulls. 

LCS 1 completed a ten-month deployment to the western pacific in 
December 2013 where it operated out of Singapore. During this 
deployment it encountered two significant engineering issues that
significantly curtailed its ability to get underway: the lubrication 
cooling system ruptured and the ship service diesel engine generator 
had reliability issues. In addition to these engineering issues, LCS
1 had a number of combat system and other material failures; including 
radar underperformance and the combat system unexpectedly rebooting
during operations. 

Other Program Issues: 

The Navy added 20 permanent berths to LCS 1 to support additional 
manning for its deployment to Singapore in 2013. In May 2013, the Navy 
determined that additional permanent accommodations for a total crew 
size of 98 should be incorporated in all LCS class ships. The LCS 
program executive office has been directed to add these permanent 
accommodations through either forward -or back-fitting the ships. 
Although the habitability modification installed on LCS 1 in support 
of its deployment did not include the addition of increased storage 
and water supplies, the forward fit installs will address the required 
services and auxiliary system modifications associated with the 
installation of the additional berthing. Following LCS 1's 2013 
deployment, the Navy will evaluate lessons learned and future
manning options. The Navy expects to complete this evaluation in 
fiscal year 2014 and incorporate any proposed manning changes 
beginning in fiscal year 2015 ahead of the next block buy decision in
2016, when 24 seaframes will already be delivered, constructed, or 
under contract. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office noted 
that LCS 4 showed significant improvement from LCS 2 in level of 
completeness and number of high priority trial cards deficiencies at
delivery. Twelve block buy ships are funded on the block buy contract 
and are in pre-production or construction, following thorough production
readiness reviews. LCS 5 and 6 launched in December 2013. LCS 1 
deployment successfully validated major portions of the LCS concept of
operations for crew rotation and contracted overseas maintenance. Ship 
service diesel generator and seawater cooler reliability issues
were satisfactorily addressed during deployment. Engineering changes 
have been incorporated to prevent and mitigate those issues in the 
future. Material failures of the radar were a result of a procedural 
error causing the system to reboot, however the radar performed to 
design specifications. The program office also provided technical 
comments, which were incorporated where deemed appropriate. 

[End of assessment] 

Littoral Combat Ship - Mission Packages (LCS MP): 

[Illustration: Source: © Northrop Grumman Corporation] 

The Navy's Littoral Combat Ship (LCS) will provide mine 
countermeasures (MCM), surface warfare (SUW), and antisubmarine 
warfare (ASW) capability using mission packages. Packages include
weapons and sensors launched and recovered from LCS seaframes and 
operated from MH-60 helicopters and unmanned vehicles. The Navy plans 
to deliver capability to the fleet in increments. We are assessing the 
Navy's progress in achieving full baseline performance capability, 
including all planned increments needed to achieve this capability for 
each package. 

Concept: 
Program start (5/04). 

System development/Production: 
First MCM delivery (9/07); 
First SUW delivery (7/08); 
First ASW delivery (9/08); 
DOD program review (7/13); 
GAO review (1/14); 
Initial capability SUW (9/14); 
Initial capability MCM (9/15); 
Initial capability ASW (9/16). 

Program Essentials: 
Prime contractor: Northrop Grumman Corporation M&TS; 
Program office: Washington Navy Yard Washington, DC; 
Funding needed to complete:
R&D: $1,647.1 million; 
Procurement: $3,656.4 million; 
Total funding: $5,334.9 million; 
Procurement quantity: 51. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 08/2007: $517.2; 
Latest 01/2014: $3,103.4; 
Percent change: NA. 

Procurement cost: 
As of 08/2007: $3,427.8; 
Latest 01/2014: $4,108.7; 
Percent change: 19.9. 

Total program cost: 
As of 08/2007: $3,954.7; 
Latest 01/2014: $7,243.5; 
Percent change: NA. 

Program unit cost: 
As of 08/2007: $61.792; 
Latest 01/2014: $113.180; 
Percent change: NA. 

Total quantities: 
As of 08/2007: 64; 
Latest 01/2014: 64; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 08/2007: NA; 
Latest 01/2014: NA; 
Percent change: NA. 

The 2007 RDT&E cost estimate does not reflect full program costs and 
cost growth is not applicable. Current estimate does not include $3.6 
billion of procurement money for replacement and other items. 

In November 2013, DOD approved the baseline for the LCS Mission 
Packages program and previously, in October 2012, transferred decision
authority to the Navy which approved the programs milestone B 
decision. The Navy held the milestone B event, which normally indicates
development start, in January 2014 but has been developing the 
packages since 2004 and has delivered eight partial packages. As a 
part of this event, the Navy produced the first full lifecycle
cost estimate. The program's acquisition cost is now $7.24 billion, an 
increase of $3.29 billion based upon its 2007 estimate, which did not
include full development costs. The Navy plans to deliver mission 
package capabilities in increments, the MCM and SUW mission packages 
are not currently expected to field their baseline performance 
capability until the Navy has purchased 32 and takes delivery of 24
seaframes. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge not attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Not applicable; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

LCS Packages Program: 

Mine Countermeasures (MCM): 

The Navy has accepted four packages without demonstrating that they 
meet requirements and plans to accept two more in fiscal 2014. The
package will be fielded in four increments: the first intends to 
remove sailors from the minefield and improve mine detection, 
classification, and destruction over legacy vessels. Although DOD
states that all systems in increment one are fully mature, 
developmental testing has shown performance problems that led to 
changes in planned tactics, removal of systems, and lowered testing 
requirements. For example, corrections to the mine-hunting sonar's 
reliability have yet to be validated in operational testing, and two 
systems, intended to sweep for and neutralize mines, had to be removed 
for safety and performance issues. Also, the Navy now requires 
multiple searches to identify mines, adding time to the process, and has
lowered increment one testing requirements for mine clearance rates. 
If operational testing proves successful, this package will not be 
able to replace all legacy capability until increment three completion 
in fiscal 2017. 

Surface Warfare (SUW): 

The Navy has taken delivery of four packages, each comprised of two 30 
millimeter guns, as well as a rigid hull inflatable boat prototype, 
boarding gear, and armed helicopters. Following the cancellation of
the non-line-of-sight launch system, the Navy planned to field the 
Griffin missile in 2015 as an initial capability. However, program 
officials stated that the Navy is rethinking this and a solution is not
yet known. 

Antisubmarine Warfare (ASW): 

The Navy restarted development of an ASW package with new requirements 
as the initial package was not going to deliver enough capability
over legacy assets. The Navy is assessing a replacement, with initial 
delivery planned in 2016, that is expected to include, among other
technologies, a variable-depth sonar—which, according to officials, 
performed well in initial tests—and a towed array. The maturity of these
technologies has not yet been independently assessed. 

Other Program Issues: 

The Navy held a preliminary design review in 2004, but the packages 
have substantively changed. The program held a milestone B event in 
January 2014 with an estimated acquisition cost of $7.24 billion.
Tests for increment one and two of the SUW and increment one of the 
MCM package are scheduled for fiscal 2014 and 2015 respectively. These
assessments evaluate progress in achieving baseline performance 
capability, which includes all planned increments for each package. 
The Navy plans to purchase 32 LCS seaframes and take delivery of at 
least 24 by the time the baseline performance capabilities of the MCM 
and SUW packages are proven and fielded. 

Program Office Comments: 

The Navy states that our assessment of program cost growth incorrectly 
compares the acquisition program baseline against a fiscal 2008 
baseline, which does not reflect the total acquisition. Further, the 
Navy states that this assessment disregards near term operational 
requirements as the data presented indicates that the program should be
delayed. The Navy also states that our assertion of excessive program 
risk, due to concurrency, is unfounded because developmental testing,
combined with capability proven during early deployments, has 
significantly reduced technical risk. This is evidence, according to 
the Navy, that the LCS will successfully complete operational testing. 
Lastly, the current missile procurement was delayed due to 
sequestration; the Navy states that the program is on track to deliver 
a capability in late 2016. 

GAO Response: 

In comparing the 2007 estimate with the acquisition program baseline, 
we used the Navy's 2007 data, which included full procurement costs 
but only five years of development cost. The Navy has acquired eight 
packages without proving capability through operational testing. In 
the absence of a defined increment-based approach for the full baseline
capability to sequentially gain knowledge and meet these requirements, 
the Navy's acquisition approach is not in accordance with best 
practices or DOD guidance in place at the time of our review. 

[End of assessment] 

Mobile User Objective System (MUOS): 

[Illustration: Source: © 2007 Lockheed Martin] 

The Navy's MUOS, a satellite communication system, is expected to 
provide a worldwide, multiservice population of mobile and fixed-site
terminal users with increased narrowband communications capacity and 
improved availability for small terminal users. MUOS will replace the
Ultra High Frequency (UHF) Follow-On (UFO) satellite system currently 
in operation and provide interoperability with legacy terminals. MUOS
consists of a network of satellites and an integrated ground network. 
We assessed both the space and ground segments. 

Concept: 
Program start (9/02). 

System development: 
Development start (9/04); 
Design review (3/07). 

Production: 
Production decision (2/08); 
First launch (2/12); 
GAO review (1/14); 
End operational test (6/14); 
Full capability (1/17). 

Program Essentials: 
Prime contractor: Lockheed Martin Space Systems; 
Program office: San Diego, CA; 
Funding needed to complete:
R&D: $176.9 million; 
Procurement: $975.1 million; 
Total funding: $1,152.0 million; 
Procurement quantity: 1. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 12/2004: $3,836.4; 
Latest 09/2013: $4,511.6; 
Percent change: 17.6. 

Procurement cost: 
As of 12/2004: $3,192.1; 
Latest 09/2013: $2,867.4; 
Percent change: -10.2. 

Total program cost: 
As of 12/2004: $7,069.1; 
Latest 09/2013: $7,448.1; 
Percent change: 5.4. 

Program unit cost: 
As of 12/2004: $1,178.186; 
Latest 09/2013: $1,241.345; 
Percent change: 5.4. 

Total quantities: 
As of 12/2004: 6; 
Latest 09/2013: 6; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 12/2004: 90; 
Latest 09/2013: NA; 
Percent change: NA. 

Latest acquisition cycle time could not be calculated because the most 
recent MUOS program baseline does not estimate dates for operational 
capability. 

The MUOS program's critical technologies are mature, its design is 
stable, and according to the program office, its manufacturing process
maturity has increased. The first satellite was launched in February 
2012—26 months later than planned at development start—and the second
satellite was launched in July 2013. Subsequent launches of MUOS 
satellites remain important due to the past operational failures of 
two UFO satellites and predicted end-of-life of on-orbit UFO 
satellites, one of which was taken off-line in November 2012. A 
remaining challenge is that users will not be able to utilize advanced 
MUOS capabilities in large part because of delays in the development, 
testing, and fielding of new user terminals. Current MUOS user terminal
procurement and fielding are managed by the Army's Tactical Radios 
Project Office. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

MUOS Program: 

Technology, Design, and Production Maturity: 

The MUOS program's technologies are mature, its design is stable, and 
its manufacturing process maturity has increased. The first two 
satellites have been launched and three other satellites are being
built. We could not assess whether critical manufacturing processes 
were in control as the program does not collect statistical process 
control data. The program has experienced quality problems in the past 
that resulted in cost increases and schedule delays; however, the 
number of manufacturing defects on the space segment has decreased 
over time. According to the program, multiple corrective action boards 
collect and track all defects in manufacturing processes and the
program uses this data to assess the maturity of production. Examples 
of specific metrics used include number of defects per 1,000 hours of 
touch labor, amount of deferred work and associated risk, and rate of 
resolving nonconformance issues. According to the program office, 
these metrics indicate continuing increases in MUOS production 
maturity and show program goals are being met. 

Other Program Issues: 

The first MUOS satellite was launched in February 2012, 26 months 
later than initially planned, and the second satellite was launched in 
July 2013. According to the program office, the remaining MUOS 
satellites are needed because most on-orbit UFO satellites are past 
their design lives. Two of these unexpectedly failed—one in June 2005 
and another in September 2006—and a third was taken off-line in 
November 2012. Program officials stated that the required availability 
level of legacy UHF communication capabilities has been provided and
based on the projected launch schedule for the remaining MUOS 
satellites, the required availability of legacy UHF communication 
capabilities is predicted to be maintained through May 2020. 

Since 2007, we have reported that synchronizing deliveries of MUOS 
satellites with compatible Joint Tactical Radio System (JTRS) 
Handheld, Manpack, and Small Form Fit (HMS) terminals has been a
challenge. Launching MUOS satellites is important to sustain legacy 
UHF communications capability. However, utilization of over 90 percent 
of MUOS's planned capability is dependent on the development of the 
MUOS waveform—which completed formal qualification testing in November 
2012—and porting the MUOS capability onto operational user terminals. 
The Army's HMS program is developing the first operational terminal to 
incorporate the MUOS waveform. Additionally, according to the MUOS 
program, other vendors wanting to integrate the MUOS waveform into 
their radios are being supported with MUOS waveform software and
government-operated MUOS test resources. 

To date, the HMS program has conducted multiple developmental tests on 
the Manpack radio and an operational test was conducted in 2012. This
testing, conducted without the MUOS waveform, found that the terminals 
did not meet all performance and reliability requirements. However,
according to the MUOS program, the radio demonstrated improved 
performance at subsequent test events and was selected for fielding to 
Army units without the MUOS waveform due to the capability increases 
it would provide. Limited testing has been conducted on terminals with 
the MUOS waveform to date. Operational testing and initial fielding of 
the HMS terminals with the MUOS waveform is planned to begin in 2014. 

Program Office Comments: 

In commenting on a draft of this assessment, the program officials 
provided technical comments, which were incorporated as appropriate. 

[End of assessment] 

MQ-1C Gray Eagle Unmanned Aircraft System (MQ-1C Gray Eagle): 

[Illustration: Source: General Atomics Aeronautical Systems, Inc.] 

The Army's MQ-1C Gray Eagle unmanned aircraft system (UAS) will 
perform reconnaissance, surveillance, target acquisition, and attack 
missions either alone or with other platforms such as the Longbow 
Apache helicopter. Each platoon-sized system includes four aircraft, 
payloads, data terminals, automatic take off and landing systems,
ground control stations, and support equipment. The Army procured less-
capable quick reaction capability variants to address urgent needs, but
these systems are not included as part of the Gray Eagle program. 

Concept: 

System development: 
Program/development start (4/05); 
Design review (10/06). 

Production: 
Low-rate decision (2/10); 
End operational test (8/12); 
Initial capability (3/13); 
Full-rate decision (6/13); 
GAO review (1/14); 
Follow-on test and evaluation (5/15). 

Program Essentials: 
Prime contractor: General Atomics Aeronautical Systems, Inc.
Program office: Redstone Arsenal, AL; 
Funding needed to complete:
R&D: $76.8 million; 
Procurement: $849.5 million; 
Total funding: $1,115.4 million; 
Procurement quantity: 6. 

Program Performance (fiscal year 2014 dollars in millions) 

Research and development cost: 
As of 04/2005: $362.7; 
Latest 08/2013: $1,006.5; 
Percent change: 177.5. 

Procurement cost: 
As of 04/2005: $705.1; 
Latest 08/2013: $3,227.8; 
Percent change: 357.8. 

Total program cost: 
As of 04/2005: $1,067.8; 
Latest 08/2013: $4,859.2; 
Percent change: 355.1. 

Program unit cost: 
As of 04/2005: $213.552; 
Latest 08/2013: $156.750; 
Percent change: -26.6. 

Total quantities: 
As of 04/2005: 5; 
Latest 08/2013: 31; 
Percent change: 520.0. 

Acquisition cycle time (months): 
As of 04/2005: 50; 
Latest 08/2013: 95; 
Percent change: 90.0. 

Total quantities include 31 platoon systems consisting of four 
aircraft and related equipment. The program will also buy 21 aircraft 
to replace attrition losses and 7 training aircraft, for a total of 
152. 

The Gray Eagle program received approval to begin full-rate production 
in June 2013 with its technologies, design, and manufacturing 
processes mature. However, design changes and supplier base issues put 
the program's cost and schedule at risk. Program officials said they are
considering a change to the aircraft tail, which would be costly and 
require retrofitting the entire fleet. The program is also developing 
a new ground control station which will not undergo operational 
testing until May 2015. In addition, a production readiness review 
conducted in support of the program's full-rate production decision
identified several high risk supplier base issues that pose 
uncertainty for the program's cost and schedule. The program is 
tracking these risks and program officials said its suppliers have 
mitigation strategies in place. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge attained; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Knowledge attained. 

MQ-1C Gray Eagle Program: 

Technology and Design Maturity: 

The Gray Eagle program reported that all five of its critical 
technologies are mature and have been demonstrated in a combat 
environment. Program officials stated that the design is generally 
stable; however, there is the potential for design changes if the 
program decides to integrate a new aircraft tail that the program's 
contractor is developing in response to an aircraft accident in 2009. 
Program officials said that integrating the new tail design would be 
costly as it would require retrofitting the entire Gray Eagle fleet, 
although it would provide increased reliability and endurance. A 
decision is expected in fiscal year 2014 on whether to move forward 
with the retrofit based on affordability considerations. 

Production Maturity: 

The Gray Eagle's 2013 production readiness assessment reported that 
its manufacturing processes are mature and at the level recommended by 
DOD guidance for the start of full-rate production. The program was 
approved to begin full-rate production of 49 aircraft and support
equipment in June 2013 and awarded the first of three planned full-
rate production contracts in September 2013. However, the program is 
tracking several risks related to its supplier base. For example, the 
Gray Eagle prime contractor is currently flight testing a new aircraft 
engine to replace the legacy engine because the legacy engine supplier 
went into bankruptcy. Program officials noted they have enough engines 
on hand for the first full-rate production lot, identifying a new
engine source poses technical, cost, and schedule risks to the 
program, according to the production readiness review. The program and 
the Defense Contract Management Agency are also tracking other risk 
items related to multiple suppliers' financial concerns as well as 
quality control, but program officials said its suppliers have 
mitigation strategies to address these risks. 

Other Program Issues: 

The Gray Eagle system completed initial operational test and 
evaluation in August 2012. DOD's Director, Operational Test and 
Evaluation (DOT&E), found the system to be operationally effective 
with the potential to provide effective support to combat units and 
suitable at meeting its performance and combat availability 
requirements. However, several recommended improvements were 
identified related to tactics, techniques, and procedures; training; 
and the design of the ground control station shelter. Specifically, 
DOT&E found that the Army needs to improve integration of Gray Eagle 
into employment concepts and improve soldier training. In addition, 
the design of the current ground control station degrades aircraft 
operator efficiency. According to the program office, the Army has 
already begun to address these issues and plans to re-evaluate them at 
the planned follow-on test and evaluation in May 2015. The follow-on 
test will also be used to assess new hardware and software the program 
is developing to replace the current ground control station as well as 
assess its net readiness capabilities. Once testing is complete, 
program officials said the Army will deploy the new ground control 
station to fielded units and will train Gray Eagle operators on the 
new system. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office 
provided technical comments, which were incorporated as appropriate. 

[End of assessment] 

MQ-4C Triton Unmanned Aircraft System (MQ-4C Triton): 

[Illustration: Source: Northrop Grumman] 

The Navy's MQ-4C Triton is intended to provide a persistent maritime 
intelligence, surveillance, and reconnaissance (ISR) capability even 
when no other naval forces are present. Triton will operate from five 
land-based sites worldwide as a part of a family of maritime patrol 
and reconnaissance systems that recapitalizes the Navy's airborne ISR
assets. Planned improvements include a signals intelligence capability 
and an upgrade to the systems communication relay. The Triton is based
on the Air Force's RQ-4B Global Hawk air vehicle. 

Concept: 

System development: 
Program/development start (4/08); 
Design review (2/11); 
GAO review (1/14). 

Production: 
Low-rate decision (11/14); 
Start operational test (1/16); 
Full-rate decision (12/16); 
Initial capability (5/17). 

Program Essentials: 
Prime contractor: Northrop Grumman Systems Corporation; 
Program office: Patuxent River, MD; 
Funding needed to complete:
R&D: $770.8 million; 
Procurement: $9,542.6 million; 
Total funding: $10,519.3 million; 
Procurement quantity: 65. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 02/2009: $3,304.2; 
Latest 12/2012: $3,639.0; 
Percent change: 10.1. 

Procurement cost: 
As of 02/2009: $9,805.7; 
Latest 12/2012: $9,592.7; 
Percent change: -2.2. 

Total program cost: 
As of 02/2009: $13,512.2; 
Latest 12/2012: $13,544.2; 
Percent change: 0.2. 

Program unit cost: 
As of 02/2009: $193.032; 
Latest 12/2012: $193.488; 
Percent change: 0.2. 

Total quantities: 
As of 02/2009: 70; 
Latest 12/2012: 70; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 02/2009: 92; 
Latest 12/2012: 109; 
Percent change: 18.4. 

The Triton's critical technology is mature, the design is stable—
although not yet demonstrated—and the program reports that 
manufacturing processes will be ready to support low-rate production. 
Testing on the first development aircraft began in September 2012
and first flight occurred in May 2013. However, the program discovered 
design challenges during integration and testing and had its 
production budget reprioritized in fiscal year 2014. Alternatives for 
an air-to-air radar subsystem are being considered and the program's 
production decision has been delayed by about one year. The program 
office authorized the prime contractor to develop a new target 
baseline and schedule that takes into account the program's increased 
costs and schedule delays. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge not attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

MQ-4C Triton Program: 

Technology and Design Maturity: 

The Triton program's one critical technology—a hydrocarbon sensor—was 
found to be mature by an April 2011 technology readiness assessment. 
However, the air-to-air radar subsystem (AARSS), which will enable 
Triton to sense and avoid other aircraft, has faced developmental 
delays and cost overruns. As a result, the Navy ordered work to be
stopped on the subsystem in April 2013 and is currently examining 
alternatives. 

The Triton design is stable and according to the program office, all 
design drawings are releasable to manufacturing, but a fully outfitted 
system-level prototype has not yet been tested. Testing of the
first development aircraft began in September 2012, followed by first 
flight in May 2013. Program officials expect the second development 
aircraft, which was expected to be the first with a full sensor suite 
and a sense-and-avoid capability, to begin testing in 2014. However, 
as a result of developmental delays, they do not plan for AARSS to be 
incorporated on the aircraft until 2016 for operational evaluation. 
Software development and maturity also remain areas of potential risk. 
The program plans to utilize nearly 8 million lines of code, more than 
20 percent of which will be new. Though some software integration 
challenges discovered during testing were resolved in 2013, two more 
phases of software development and installation are scheduled for
completion before the aircraft enters into operational evaluation. 

Production Maturity: 

In November 2011, the program received approval to build three air 
vehicles and ground stations, in part to demonstrate its manufacturing 
processes prior to production. Program officials noted that one of 
these three aircraft will no longer be produced because of new 
priorities within the Navy's budget. The program reports that 
manufacturing processes will be able to support low rate initial 
production after the production decision is made. The Triton aircraft 
is based on the Air Force's RQ-4B Global Hawk and uses sensor 
components and subsystems from other platforms. There are some 
structural changes to the airframe, but none of these require 
significant changes to manufacturing processes. The program plans to 
award a contract for long lead material one year prior to the low-rate 
initial production contract award. 

Other Program Issues: 

The Triton program's production decision has been delayed by about one 
year because of design adjustments to ensure airworthiness and software
stability issues discovered during system integration and testing as 
well as the Navy's decision to reprioritize the program's production 
funding for fiscal year 2014. The program office authorized the prime 
contractor to develop a new target baseline and schedule to take into 
account increased costs and delays. Program officials expected to 
receive the revised baseline and schedule in December 2013. According 
to program officials, the delay has allowed the contractor to resolve 
some technical issues. 

In September 2013, the Global Hawk program experienced an anomaly with 
a navigation system held in common with Triton. Though the Triton 
program did not experience the same anomaly, test flights were 
suspended until a work around was identified. The Air Force is 
continuing its investigation into the cause of the navigation system
issue. 

Program Office Comments: 

In addition to providing technical comments, the program office noted 
that the Triton UAS program continues to demonstrate success during 
its system development and demonstration phase as evidenced by the 
nine initial envelope expansion flights conducted to date. As reported 
in the December 2012 Selected Acquisition Report, the program breached 
the acquisition program baseline cost threshold for research, 
development, test and evaluation and the schedule thresholds for 
reaching production start, operational evaluation start, full rate 
production, and initial operational capability. The program has been 
re-planned to adjust the cost and schedule remaining for the system
development and demonstration contract. A proposed program baseline 
revision is in work and all parameters will be reviewed, to include the
operating and support cost estimate. The program continues to benefit 
from strong support within the Department of the Navy. 

[End of assessment] 

MQ-8 (Fire Scout): 

[Illustration: Source: Northrop Grumman Corporation] 

The Navy's MQ-8 unmanned aerial vehicle is intended to provide real-
time imagery and data in support of intelligence, surveillance, and
reconnaissance missions. An MQ-8 system is comprised of up to three 
air vehicles with sensors, two ground control stations, and one recovery
system. The air vehicle launches and lands vertically, and operates 
from ships and land. The MQ-8 is intended for use in various operations,
including surface, anti-submarine, and mine warfare. We assessed the 
latest variant, the MQ-8C. 

Concept: 

System development: 
Program start (1/00); 
Design review (11/05). 

Production: 
Low-rate decision (5/07); 
MQ-8C first flight (10/13); 
GAO review (1/14); 
Initial operating capability (2/14); 
Full-rate decision (TBD). 

Program Essentials: 
Prime contractor: Northrop Grumman; 
Program office: Patuxent River, MD; 
Funding needed to complete:
R&D: $0.0 million; 
Procurement: $1,685.1 million; 
Total funding: $1,685.1 million; 
Procurement quantity: 145. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 12/2006: $629.0; 
Latest 09/2013: $711.8; 
Percent change: 13.2. 

Procurement cost: 
As of 12/2006: $1,769.6; 
Latest 09/2013: $2,099.4; 
Percent change: 18.6. 

Total program cost: 
As of 12/2006: $2,750.7; 
Latest 09/2013: $2,811.2; 
Percent change: 2.2. 

Program unit cost: 
As of 12/2006: $15.540; 
Latest 09/2013: $16.064; 
Percent change: 3.4. 

Total quantities: 
As of 12/2006: 177; 
Latest 09/2013: 175; 
Percent change: -1.1. 

Acquisition cycle time (months): 
As of 12/2006: 104; 
Latest 09/2013: 169; 
Percent change: 62.5. 

The Navy ceased production of the MQ-8B variant and in April 2012 
awarded a contract to begin development and production of the new
MQ-8C with a larger airframe to improve range, endurance, payload, and 
future carrying capacity. MQ-8C relies on common, mature technologies
with the MQ-8B. The engineering design of the MQ-8C is complete as it 
is based on the MQ-8B design, which appeared to be stable before
halting production. The program completed operational test and 
evaluation of MQ-8B in December 2013 and a Quick Reaction Assessment 
of MQ-8C will be completed in the fourth quarter of fiscal year 2014. 
The program plans to conduct an acquisition strategy review in the 
first quarter of fiscal year 2014 that assesses overall program 
health, including production readiness. In 2015, the program plans to 
test the MQ-8C on the Littoral Combat Ship, the platform originally 
intended for MQ-8B. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained; 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained; 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Information not 
available; 
* Demonstrate critical processes on a pilot production line: Knowledge 
attained; 
* Test a production-representative prototype: Knowledge attained. 

Fire Scout Program: 

Technology and Design Maturity: 

According to the program office, MQ-8C is 90 percent common with the 
previously developed MQ-8B, with the primary difference being 
structural modifications to accommodate the MQ-8C's larger airframe 
and fuel system. The MQ-8C relies on mature technologies common to the 
MQ-8B and does not introduce any new technologies. Program officials 
stated that the engineering design of MQ-8C is complete, as it is 
based on the MQ-8B design, which appeared to be stable prior to the 
Navy's decision to cease production of the system in 2012. Program 
officials noted that a revision to the air vehicle to accommodate 
increased payload remains to be completed, but they expect the issue 
to be resolved by early calendar year 2014. The first flight of the MQ-
8C occurred in October 2013. 

Production Maturity: 

The program plans to produce the MQ-8C on the same production line as 
the MQ-8B and officials stated that they have not experienced 
challenges in transitioning production between the systems. The 
program's production processes for MQ-8B have been demonstrated, but 
we could not assess whether critical manufacturing processes were in
control as the program does not collect data on statistical process 
controls or assess process capabilities using manufacturing readiness 
levels. The program suspended production of MQ-8B and awarded a 
development and production contract for 8 MQ-8Cs in April 2012. The 
program earlier intended to resume production of the MQ-8B aircraft
in 2015 to align with the delivery of the Littoral Combat Ship—the 
platform from which MQ-8B is intended to operate—but the Navy plans to 
continue MQ-8C production instead. The Navy plans to award a third 
production contract for MQ-8C in March 2014 in support of the Joint 
Emergent Operational Need. Program officials stated that the date of 
the full-rate production decision has not been determined. Future 
procurements will be addressed in the updated acquisition strategy. 

Other Program Issues: 

The program has shifted its focus to MQ-8C—an upgraded variant of the 
aircraft with improved range, endurance, payload, and future carrying
capacity—due to a joint urgent operational need from U.S. Africa 
Command. According to program officials, the program is not requesting 
new funds for MQ-8C, but plans to use funding slated for MQ-8B. MQ-8C 
is not required to conform to many of the acquisition practices 
followed by other programs as it is being developed to fill a joint 
urgent operational need. However, a Quick Reaction Assessment is
planned for MQ-8C 3 to 4 months prior to ship deployment, which is 
expected to be in the first quarter of fiscal year 2015. The program 
is planning to test the MQ-8C at-sea in 2014 on the DDG-109 and on the 
Littoral Combat Ship in 2015. The program completed operational test 
and evaluation of MQ-8B in December 2013 and a Quick Reaction 
Assessment of MQ-8C will be completed in the fourth quarter of fiscal 
year 2014. The program plans to conduct an acquisition strategy review 
in the first quarter of fiscal year 2014 that assesses overall program 
health, including production readiness. 

Program Office Comments: 

According to the program office, the MQ-8 Fire Scout system has 
accumulated over 4,500 flights totaling more than 12,000 flight hours 
with the MQ-8B air vehicle. In the first quarter of fiscal year 2014,
the system was assessed by the Navy Operational Test community aboard 
USS Roberts and completed an Initial Operational Capability 
Supportability Review in preparation for fleet transition and Initial 
Operational Capability in second quarter fiscal year 2014. The Fire 
Scout system with the MQ-8C Endurance Upgrade aircraft is being 
procured in response to a Joint Emergent Operational Need from Africa 
Command. The Navy is planning to incorporate the MQ-8C variant into
the Fire Scout system as part of its updated acquisition strategy. 
First flight of the MQ-8C occurred on October 31, 2013. As of January 
2014, the MQ-8C has performed more than 32 test flights and 
accumulated over 46 flight hours. In commenting on a draft of this 
assessment, the program office provided technical comments, which were 
incorporated where deemed appropriate. 

[End of assessment] 

MQ-9 Reaper Unmanned Aircraft System (MQ-9 Reaper): 

[Illustration: Source: U.S. Air Force] 

The Air Force's MQ-9 Reaper is a multirole, medium-to-high-altitude 
endurance unmanned aircraft system capable of flying at higher speeds
and altitudes than its predecessor, the MQ-1 Predator A. The Reaper is 
designed to provide a ground-attack capability to find, fix, track, 
target, engage, and assess small ground mobile or fixed targets. Each 
system consists of four aircraft, a ground control station, and a 
satellite communications suite. We assessed the increment I Block 5 
configuration and made observations on Block 1. 

Concept: 
Program start (1/02). 

System development: 
Development start (2/04); 
Design review - Block 5 (1/11); 
Required assets available (6/12). 

Production: 
Low-rate decision - Block 5 (11/12); 
GAO review (1/14); 
Follow-on operational test (1/16). 

Program Essentials: 
Prime contractor: General Atomics Aeronautical Systems, Inc.
Program office: Wright-Patterson AFB, OH; 
Funding needed to complete:
R&D: $843.3 million; 
Procurement: $6,055.7 million; 
Total funding: $6,921.1 million; 
Procurement quantity: 161. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 02/2008: $441.9; 
Latest 09/2013: $1,613.0; 
Percent change: 265.0. 

Procurement cost: 
As of 02/2008: $2,220.7; 
Latest 09/2013: $10,826.4; 
Percent change: 387.5. 

Total program cost: 
As of 02/2008: $2,773.5; 
Latest 09/2013: $12,517.3; 
Percent change: 351.3. 

Program unit cost: 
As of 02/2008: $26.414; 
Latest 09/2013: $30.983; 
Percent change: 17.3. 

Total quantities: 
As of 02/2008: 105; 
Latest 09/2013: 404; 
Percent change: 284.8. 

Acquisition cycle time (months): 
As of 02/2008: 79; 
Latest 09/2013: 100; 
Percent change: 26.6. 

The Reaper's critical technologies are mature and all design drawings 
have been released. Delays in manufacturing, delivery of technical 
data, and developmental testing have pushed back critical software 
releases for both Block 1 and Block 5 configurations. The MQ-9 Reaper 
was approved for low-rate initial production in November 2012, but has 
not yet demonstrated that critical manufacturing processes are in 
control. The program originally expected to complete operational 
testing no later than October 2014; however manufacturing and other 
delays have caused the program to postpone the completion of testing 
until January 2016. The program's full-rate production decision was 
changed to an in-process review because more than half of the aircraft 
will be procured prior to a full-rate production decision. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge not 
attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
not attained; 
* Test a production-representative prototype: Knowledge attained. 

MQ-9 Reaper Program: 

Technology and Design Maturity: 

The Reaper's critical technologies are considered mature and its 
design is stable. Manufacturing issues, as well as delays in the 
delivery of technical data and developmental testing have pushed back
critical Block 1 and Block 5 configuration software releases by 8 
months and 15 months, respectively. Program officials now plan to 
field the Block 5 software in March 2016. The Block 5 configurations
include capability enhancements from the Block 1 configuration such as 
updates to the radar, data link, sensor, landing gear, software, and 
ground control stations. Until testing is completed, the Block 5 
system remains at risk of design changes. 

Production Maturity: 

The Air Force approved low-rate initial production of the MQ-9 Reaper 
Block 5 Increment in November 2012. According to program officials, 
the Block 5 manufacturing processes have reached the level of maturity 
recommended by DOD guidance for the start of low-rate production. 
However, the program's manufacturing readiness level did not indicate 
that its production processes were in statistical control, as 
recommended by our best practices. MQ-9 Reaper production deliveries 
have slowed over the past year because of delinquencies in completing
technical data, software delays, and fuel tank issues that required 
engineering design changes to the production line and retrofitting 
aircraft that had already been produced. As of December 2013, 21
Block 1 aircraft have been produced, but are still awaiting the 
necessary software capability upgrades before they can be delivered. 
Until these software upgrades are complete, aircraft are only being 
delivered based on urgent needs. According to program officials, the 
program has developed an aircraft delivery recovery plan that should 
allow deliveries to be back on track by April 2014. 

Other Program Issues: 

The program office declared a breach to the MQ-9 Block 5 program's 
schedule baseline in May 2013 because of delays associated with 
manufacturing, technical data, and developmental testing. The program 
originally expected to complete operational testing no later than 
October 2014. Operational testing will now be complete in January 
2016. This schedule change was approved by the configuration steering 
board in December 2013. At this time, the full-rate production 
decision was changed to an in-process review since more than half of 
the aircraft will be procured prior to the full rate production 
decision. The program office is in the process of updating the 
acquisition program baseline. 

Program Office Comments: 

In commenting on a draft of this assessment, program officials noted 
that since the program office declared a breach in May 2013, the 
program office and contractor resolved issues that delayed schedule 
and are implementing processes to improve quality for future success. 
The re-baselined MQ-9 Block 5 schedule was approved at the Air Force 
review board in August 2013 and the configuration steering board in 
December 2013. The program office is updating the acquisition program 
baseline to reflect program changes. Follow-on test and evaluation is 
now planned to complete in January 2016. The program office is 
currently in formal developmental test of Block 5. The program office 
also took delivery of the first Block 5 aircraft in November 2013 to 
assist with developmental test and technical order development. The 
program office also provided technical comments that were incorporated 
as appropriate. 

[End of assessment] 

Next Generation Operational Control System (GPS OCX): 

[Illustration: Source: U.S. Air Force] 

The Air Force's Global Positioning System Next Generation Operational 
Control System (GPS OCX) is to replace the current ground control 
system for legacy and new GPS III satellites. GPS OCX is expected to 
ensure reliable and secure delivery of position and timing information 
to military and civilian users. The Air Force plans to develop GPS OCX 
in blocks, with each block delivering upgrades as they become 
available. We assessed the initial three blocks, which support the 
launch, checkout, and operation of GPS II and III satellites. 

Concept: 
Program start (2/07). 

System development: 
Development start (11/12); 
GAO review (1/14). 
Block 0 delivery (11/14); 
Start operational test (8/15). 

Production: 
Production start (10/15); 
Initial capability - Block 1 (10/16); 
Initial capability - Block 2 (6/17). 

Program Essentials: 
Prime contractor: Raytheon; 
Program office: El Segundo, CA; 
Funding FY14 to FY 19:
R&D: $1,662.8 million; 
Procurement: $0.0 million; 
Total funding: $1,662.8 million; 
Procurement quantity: 0. 

Program Performance (fiscal year 2014 dollars in millions): 

Table includes costs through fiscal year 2019. 

Research and development cost: 
As of: NA; 
Latest 12/2012: $3,470.3; 
Percent change: NA. 

Procurement cost: 
As of: NA; 
Latest 12/2012: $0.0; 
Percent change: NA. 

Total program cost: 
As of: NA; 
Latest 12/2012: $3,470.3; 
Percent change: NA. 

Program unit cost: 
As of: NA; 
Latest 12/2012: $3,470.350; 
Percent change: NA. 

Total quantities: 
As of: NA; 
Latest 12/2012: 1; 
Percent change: NA. 

Acquisition cycle time (months): 
As of: NA; 
Latest 12/2012: 55; 
Percent change: NA. 

GPS OCX entered system development in November 2012. The program 
consists of three blocks: Block 0, intended to support the launch
and checkout of GPS III satellites; Block 1, designed for command and 
control of the GPS II and III satellites; and Block 2, which is expected
to support, monitor, and control additional navigation signals. The 
program's 14 critical technologies are nearing maturity, but seven of
those technologies are not expected to reach full maturity until the 
end of fiscal year 2015 or later, nearly 3 years after the program 
began system development. Aligning the schedules for GPS OCX and GPS 
III is a risk for both programs. Block 1 is scheduled to become 
operational by October 2016, 6 months after the date of GPS III's
availability for launch. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained;. 

Product design is stable: 
* Release at least 90 percent of design drawings: Not applicable; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

GPS OCX Program: 

Technology Maturity: 

GPS OCX entered system development in November 2012 with all of its 14 
critical technologies tested in a relevant environment, but not a 
realistic environment. According to program officials, these 
technologies will not reach full maturity until the program integrates 
together all of the key subsystems and components and tests them in 
the factory. The first of these tests is scheduled to occur near the 
end of fiscal year 2014 and is expected to result in seven of the 
technologies reaching full maturity. The remaining seven technologies 
are not expected to reach full maturity until the end of fiscal year 
2015 or later, nearly three years after the program began system
development. 

Design and Production Maturity: 

GPS OCX is primarily a software development program and is expected to 
provide capabilities in three block deliverables. Block 0 is intended 
to provide initial capability for launch control and checkout of GPS 
III satellites. Block 1 is designed to operate legacy and new GPS 
satellites, including new civilian signals, and Block 2 is expected to 
add operational control of new international and modernized military 
signals. 

According to the program office, software is being developed and 
tested incrementally with a critical design review after each stage to 
ensure the design is stable. Software development for Block 0 is nearly
complete and all remaining testing is scheduled for completion at the 
beginning of fiscal year 2015. The program has started development 
activities for Block 1, which program officials expect to be completed 
in October 2016. 

Program officials expect to integrate the software and hardware 
components for all of Blocks 0 and 1 and test them as a prototype to 
ensure the system will work as intended. According to GAO's best 
practices, this integrated prototype test should occur before critical 
design review. However, program officials stated that the test will 
not happen until December 2015, 18 months after the final
critical design review and ten months before Block 1 is scheduled to 
be complete. Program officials reported that they had used other 
knowledge-based practices to increase confidence in the stability of
the design such as identifying key product characteristics and 
establishing a reliability growth curve. 

Other Program Issues: 

The program experienced significant schedule delays while in 
technology development. This, combined with the program's late start 
relative to GPS III, has resulted in considerable risk in aligning
the schedules of GPS OCX and GPS III satellites. Block 1, which is to 
provide command and control for GPS III satellites on orbit, is not 
scheduled to become operational until October 2016, 6 months after the 
first GPS planned GPS III satellite is expected to be available for 
launch. Until Block 1 is operational, the GPS III satellite will have 
very limited capabilities and Air Force officials said they do not 
plan to launch a second GPS III satellite until that time. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office 
provided technical comments, which were incorporated as appropriate. 

[End of assessment] 

P-8A Poseidon Multi-Mission Maritime Aircraft (P-8A): 

[Illustration: Source: U.S. Navy] 

The Navy's P-8A Poseidon is a commercial derivative aircraft that will 
replace the P-3C Orion. Its primary roles are antisubmarine warfare,
antisurface warfare, and intelligence, surveillance, and 
reconnaissance. The P-8A is part of a family of systems, including the 
MQ-4C Triton unmanned aircraft system, which will perform maritime 
patrol missions and support the Navy's maritime warfighting 
capability. The program plans to field capabilities in three 
increments. We assessed increment one and made observations on
increments two and three. 

Concept: 
Program start (3/00). 

System development: 
Development start (5/04); 
Design review (6/07). 

Production: 
Low-rate decision (8/10); 
End operational test (3/13); 
Initial capability (11/13); 
Full-rate decision (1/14); 
GAO review (1/14). 

Program Essentials: 
Prime contractor: The Boeing Company; 
Program office: Patuxent River, MD; 
Funding needed to complete:
R&D: $552.4 million; 
Procurement: $15,984.3 million; 
Total funding: $16,811.2 million; 
Procurement quantity: 80. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 06/2004: $7,921.2; 
Latest 08/2013: $8,826.6; 
Percent change: 11.4. 

Procurement cost: 
As of 06/2004: $24,574.2; 
Latest 08/2013: $25,122.3; 
Percent change: 2.2. 

Total program cost: 
As of 06/2004: $32,640.1; 
Latest 08/2013: $34.336.0; 
Percent change: 5.2. 

Program unit cost: 
As of 06/2004: $283.827; 
Latest 08/2013: $281.442; 
Percent change: -0.8. 

Total quantities: 
As of 06/2004: 115; 
Latest 08/2013: 122; 
Percent change: 6.1. 

Acquisition cycle time (months): 
As of 06/2004: 160; 
Latest 08/2013: 164; 
Percent change: 2.5. 

The P-8A entered production in August 2010 with mature technology, a 
stable design, and proven production processes. The P-8A completed 
initial operational testing in March 2013 and was found to be 
operationally suitable and effective. The test report identified five 
significant deficiencies and recommended that the P-8A be introduced 
to the fleet with several operational restrictions. According to the 
program office, it has plans in place to correct or otherwise resolve 
these deficiencies. The program's full rate production decision was 
delayed from July 2013 until January 2014 in part to enable additional
assessment of deficiency corrections from developmental test and 
evaluation. To maintain production continuity, and utilize available
funding, the program awarded a fourth low-rate production contract. 
The first P-8A operational deployment began in December 2013. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
attained; 
* Test a production-representative prototype: Not applicable. 

P-8A Program: 

Technology Maturity: 

The P-8A entered production in August 2010 with a fully mature and 
sole critical technology, the hydro-carbon sensor. The sonobuoy 
launcher, which at one time was also considered a critical technology,
has experienced issues in testing and fixes are still being made to 
improve its performance and reduce operator errors. 

Design Maturity: 

Overall, the design of the P-8A is stable, but the number of design 
drawings continues to grow due to deficiencies discovered in testing. 
The number of releasable drawings increased by 16 percent since our 
last assessment and 95 percent of the total drawings have been 
released. 

Production Maturity: 

The manufacturing processes for P-8A are mature and the program has 
improved the acceptance process after minor anomalies and maintenance
issues were discovered with each of the first five production 
aircraft. According to program officials, Boeing has implemented 
additional pre-acceptance flights, which have reduced the number of 
issues discovered by the government during the formal acceptance 
process. More recently, the Defense Contract Management Agency 
reported the late delivery of spare parts could affect aircraft 
deliveries by reducing the program's ability to swap out defective 
parts when needed. The program office stated that it has addressed 
this issue and aircraft deliveries had not been impacted to date. 

Other Program Issues: 

The P-8A program completed initial operational test and evaluation in 
March 2013. The final test report found the aircraft to be 
operationally effective and suitable. The report identified five 
significant deficiencies that are typically corrected before 
operational deployment and the operational test staff recommended that 
the P-8A enter the fleet with several operational restrictions. 
According to the program office, it has plans in place to correct or 
otherwise resolve these deficiencies. For example, to maintain main 
fuel tank temperatures within required operating limits during hot 
weather ground operations, the program is re-qualifying key components 
to higher operating limits and developing new planning tools and 
fueling procedures. The first operational deployment of P-8A commenced 
in December 2013. Follow-on operational testing, which includes 
verifying test fixes discovered previously in developmental testing, 
began in October 2013. 

The Navy delayed the program's full rate production decision from July 
2013 until January 2014 in order to allow enough time for the program 
to assess deficiency corrections. To maintain production line 
continuity, and utilize available program funding, the program awarded 
a fourth low-rate initial production contract for 13 aircraft. 

During increments 2 and 3, the program plans to integrate additional 
capabilities into the P-8A. Increment 2, which is being managed as a 
series of engineering changes rather than a separate development 
effort, includes various improvements to the system's antisubmarine 
warfare and other capabilities. The program eventually plans to retrofit
previously manufactured aircraft with the planned Increment 2 
capabilities. The Navy plans to conduct a separate system development 
phase for increment 3. The improvements include changes to the P-8A's 
system architecture to allow for rapid integration of new applications 
and services. The program plans to conduct full and open competition
for its increment 3 contracts and to purchase the data rights for the 
new, more open architecture. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office stated 
that following an extensive operational test period, the Navy's 
operational test authority reported that the P-8A aircraft is
operationally effective and suitable and recommended it for fleet 
introduction. The program office added that this conclusion is 
consistent with the fleet's experience with the aircraft during
extensive aircraft transition and pre-deployment training cycles. The 
first such cycle began with the delivery of the first P-8A aircraft to 
an operational squadron in May 2012, included the attainment of 
initial operational capability in November 2013, and culminated with 
the departure of the first fully trained squadron for operational 
deployment later that same month. In December 2013, the thirteenth
of 37 low-rate initial production aircraft was delivered to fleet 
squadrons, with all deliveries on or ahead of schedule. The program 
office also provided technical comments, which were incorporated as 
appropriate. 

Paladin Integrated Management (PIM): 

[Illustration: Source: U.S. Army] 

The Army's Paladin Integrated Management (PIM) system consists of two 
individual platforms, a self-propelled howitzer (SPH) and a tracked 
ammunition carrier that provides operational support. The SPH is a 
tracked, aluminum armored vehicle with a 155 millimeter cannon. The 
PIM will provide improved sustainability over the current Paladin M109A6
howitzer fleet through the incorporation of a newly designed hull; 
modified M2 Bradley infantry fighting vehicle power train, suspension 
system, and track; and a modernized electrical system. 

Concept: 

System development: 
Development start (6/07); 
Design review (12/08). 

Production: 
Low-rate decision (10/13); 
GAO review (1/14); 
Start operational test (7/16); 
Full-rate decision (1/17); 
Initial capability (4/17). 

Program Essentials: 
Prime contractor: BAE Systems Land & Armament L.P. 
Program office: Warren, MI; 
Funding needed to complete:
R&D: $367.7 million; 
Procurement: $5,684.8 million; 
Total funding: $6,052.5 million; 
Procurement quantity: 556. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 02/2012: $1,060.1; 
Latest 10/2013: $1,101.7; 
Percent change: 3.9. 

Procurement cost: 
As of 02/2012: $5,973.4; 
Latest 10/2013: $5,886.3; 
Percent change: -1.5. 

Total program cost: 
As of 02/2012: $7,033.5; 
Latest 10/2013: $6,987.9; 
Percent change: -0.6. 

Program unit cost: 
As of 02/2012: $12.085; 
Latest 10/2013: $12.523; 
Percent change: 3.6. 

Total quantities: 
As of 02/2012: 582; 
Latest 10/2013: 558; 
Percent change: -4.1. 

Acquisition cycle time (months): 
As of 02/2012: 118; 
Latest 10/2013: 118; 
Percent change: 0.0. 

The program was approved for low-rate initial production in October 
2013 with the first production delivery scheduled for March 2015.
Program officials stated that a lack of available staff, staff 
furloughs, loss of workforce overtime, and a reduction in travel 
funding due to sequestration caused the production decision date to 
slip from June 2013 to October 2013. The program was approved for 
production with its two critical technologies fully mature and a stable
design. The program, as originally structured, was not a major defense 
acquisition program, but was elevated to major defense acquisition 
program status due to rising cost estimates. The program has also 
experienced schedule slippage due to delays in the start of 
developmental testing and changes to force protection and survivability
requirements that drove the addition of new armor kits and a new 
ballistic hull and turret. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge not 
attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
not attained; 
* Test a production-representative prototype: Knowledge not attained. 

PIM Program: 

Technology Maturity: 

The program office identified two technologies critical to the PIM 
program; power pack integration and the ceramic bearing of the 
generator assembly. Both technologies have been assessed as fully
mature. The program office identified these technologies as critical 
based on concerns about their performance at high temperatures. While 
neither technology is new or novel, failure of either would represent 
major program risk. In addition, increases in vehicle weight due to 
the addition of material to improve survivability, minimal power pack 
space, and other integration issues may degrade the ability to meet 
automotive performance requirements. 

Design Maturity: 

According to the program office, the design is currently stable with 
all of the expected drawings released; however, the program faces a 
number of design challenges as it moves forward. The current 
contractor for the engine and transmission may cease production due to 
lack of orders. If this occurs, production with another vendor may be
necessary and could result in a redesign of the engine and engine 
compartment. Production with another vendor has the potential for cost 
growth between $32 to $100 million and a significant schedule delay. 
Additionally, after the critical design review, the program manager 
identified a number of corrective actions, producibility, and 
obsolescence engineering changes to the PIM design that are scheduled 
to be implemented between low-rate initial production and initial 
operational test and evaluation. If significant issues are uncovered
during the testing of these engineering changes, then there is 
potential for cost growth and delays in production. 

Production Maturity: 

The program was approved for low-rate initial production in October 
2013 with the first production vehicle scheduled for delivery in March 
2015. As of August 2013, the program office indicated that a number of 
manufacturing processes and systems are below the maturity levels 
required by best practices. The program reported that the capability
to produce the vehicles in a pilot-line environment will be not be 
demonstrated until after production begins. Our best practices work 
has shown that programs risk missing cost and schedule targets if
their manufacturing processes are not demonstrated and in control 
before production begins. Program officials have indicated that there
is a minimal risk that the PIM final assembly facility may not be 
ready in time to support initial PIM shipments. 

Other Program Issues: 

The program's current plans are schedule driven, with limited time for 
correction of deficiencies identified in developmental testing and 
little flexibility with individual component test schedules. The 
program is waiting for low-rate initial production vehicles before 
verifying most corrective actions. Additionally, program officials 
stated that the PIM and the Bradley infantry fighting vehicle programs
currently share a common path for the suspension and power train, but 
if the Bradley program diverges from this path there could be cost and 
schedule impacts for the PIM program. 

Program Office Comments: 

In commenting on a draft of this assessment, the Army stated that the 
PIM program is on track for its full-rate decision scheduled for 
January 2017. Additionally, technical comments were provided, which 
were incorporated as appropriate. 

[End of assessment] 

Presidential Helicopter Fleet Replacement Program (VXX): 

[Illustration: Source: U.S. Navy] 

The Navy's VXX program is to provide a replacement helicopter fleet 
that will be used to transport the President, Vice President, heads of 
state, and others. As a successor to the terminated VH-71 program, the 
VXX fleet of 21 new helicopters will replace the current fleet of 19 
VH-3D and VH-60N legacy helicopters and two training aircraft (to be 
delivered in 2014). The program plans to enter system development in 
March 2014. Until the VXX helicopters are available, the Navy is 
extending the availability of the legacy aircraft. 

Concept: 
Material development decision (3/10); 
GAO review (1/14). 

System development: 
Development start (3/14); 
Critical design review (7/16). 

Production: 
Low-rate decision (11/18); 
Start operational test (1/20); 
Initial capability (8/20); 
Full-rate decision (5/21). 

Program Essentials: 
Prime contractor: TBD; 
Program office: Patuxent River, MD; 
Funding FY14 to FY18:
R&D: $2,316.2 million; 
Procurement: $0.0 million; 
Total funding: $2,316.2 million; 
Procurement quantity: 0. 

Program Performance (fiscal year 2014 dollars in millions): 

Table includes costs through fiscal year 2018. 

Research and development cost: 
As of: NA; 
Latest 11/2013: $2,532.0; 
Percent change: NA. 

Procurement cost: 
As of: NA; 
Latest 11/2013: $0.0; 
Percent change: NA. 

Total program cost: 
As of: NA; 
Latest 11/2013: $2,523.0; 
Percent change: NA. 

Program unit cost: 
As of: NA; 
Latest 11/2013: TBD; 
Percent change: NA. 

Total quantities: 
As of: NA; 
Latest 11/2013: 23; 
Percent change: NA. 

Acquisition cycle time (months): 
As of: NA; 
Latest 11/2013: 77; 
Percent change: NA. 

The Navy made progress in establishing a limited development effort 
that reflects trade-offs made among cost, schedule, risk, and 
performance. Since April 2012, the program completed its analysis of 
alternatives, in which affordability and cost control are key factors, 
finalized the requirements and acquisition strategy, and was granted a 
waiver to the competitive prototyping requirement. Program 
affordability and timeliness are achieved by maintaining a candidate
platform's current airworthiness certification, leveraging mature 
technologies, and through Government definition of the mission systems
architecture and related avionics. To minimize risk, a sub-system 
preliminary technical readiness assessment was conducted in February 
2013. However, a system level preliminary design review has been 
deferred until after the March 2014 start of system development. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge not attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge not attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Not applicable; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

VXX Program: 

Technology Maturity: 

The program reports the key technologies to be provided the government 
for integration into the VXX platform either already exist or are in
development, some as legacy fleet aircraft upgrades. To minimize 
technical risk, the program completed a preliminary technical readiness
assessment in February 2013; it was limited to the mission 
communication system (the only new technology envisioned for the VXX 
platform). As a result of this assessment, it was deemed the VXX
mission communication system does not include any components that 
would be considered immature and classified as a critical technology
element. Although the program has conducted a sub-system preliminary 
design review, it does not currently plan to conduct a preliminary 
design review until after the program enters system development. The 
statutory requirement for a preliminary design review has been waived, 
and will be conducted after the start of system development. To be 
consistent with the program's approved acquisition strategy, the 
language in the request for proposals encourages the use of mature off-
the-shelf technologies that should only require standard engineering 
development practice to integrate and achieve installed systems 
performance. 

Design Maturity: 

The VXX acquisition strategy is based on the integration of mature 
subsystems into an existing air vehicle. While minor changes to the 
platform, to accommodate integration of subsystems, are inevitable, 
change to major components such as drive train, rotors, engines and 
basic structure is highly discouraged. Any design elements that 
contain immature technology or that might be deemed a critical 
technology element are discouraged. The request for proposals encouraged
offerors to remain within the existing airworthiness qualification of 
the baseline aircraft from which the VXX would be derived. The 
government does not intend to impose bottom-up airworthiness criteria
that would drive redesign, but plans to leverage the current 
certification basis with the cognizant civil or U.S. military 
airworthiness certification authority to achieve a Naval Air Systems 
Command flight clearance. 

Production Maturity: 

This program will leverage "green air vehicle" production by randomly 
selecting aircraft off the existing production line. This will save the
government time and money by avoiding infrastructure costs associated 
with constructing a unique production facility and allow the program to
meet its security production and supply requirements. 

Other Program Issues: 

The program intends to award a single fixed-price type contract for 
the system development phase that will include options for low-rate 
initial production, full rate production, and associated logistics 
elements. The total aircraft quantity includes six aircraft to support 
system development, 17 production aircraft in three lots (six aircraft 
each in lot 1 and 2, and 5 in lot 3). The total period of performance 
will be approximately 8 years. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office 
provided technical comments, which were incorporated where deemed 
appropriate. 

[End of assessment] 

RQ-4A/B Global Hawk Unmanned Aircraft System (RQ-4A/B Global Hawk): 

[Illustration: Source: Northrop Grumman] 

The Air Force's Global Hawk is a high-altitude, long-endurance 
unmanned aircraft that provides intelligence, surveillance, and 
reconnaissance capabilities. After a successful technology 
demonstration, the system entered development and limited production 
in March 2001. The early RQ-4A, similar to the original demonstrators, 
was retired in 2011, leaving a fleet of the larger and more capable RQ-
4Bs, produced in three configurations—-Block 20, 30, and 40. 

Concept: 
Demonstration program start (2/94). 

System development: 

Production: 
Development start/low-rate decision (3/01); 
Block 30 initial capability (8/11); 
GAO review (1/14); 
Start Block 40 operational test (10/14); 
Block 40 initial capability (TBD). 

Program Essentials: 
Prime contractor: Northrop Grumman; 
Program office: Wright-Patterson AFB, OH; 
Funding needed to complete:
R&D: $318.6 million; 
Procurement: $170.1 million; 
Total funding: $488.7 million; 
Procurement quantity: 0. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 03/2001: $1,095.6; 
Latest 08/2013: $4,028.2; 
Percent change: 267.7. 

Procurement cost: 
As of 03/2001: $4,542.3; 
Latest 08/2013: $5,708.1; 
Percent change: 25.7. 

Total program cost: 
As of 03/2001: $5,671.1; 
Latest 08/2013: $9,874.5; 
Percent change: 74.1. 

Program unit cost: 
As of 03/2001: $90.017; 
Latest 08/2013: $219.432; 
Percent change: 143.8. 

Total quantities: 
As of 03/2001: 63; 
Latest 08/2013: 45; 
Percent change: -28.6. 

Acquisition cycle time (months): 
As of 03/2001: 55; 
Latest 08/2013: TBD; 
Percent change: TBD. 

The Global Hawk program has mature technologies, a stable design, and 
mature manufacturing processes that are in statistical control. 
Congress directed the program to purchase the final three Block 30 
aircraft and the program office awarded an advanced procurement 
contract in September 2013. All 45 Global Hawk aircraft have been 
purchased without a full-rate production decision. Congress directed 
the program to maintain the operational capability of Block 30 
aircraft through December 2014. The Air Force will determine the final 
force structure following fiscal year 2015 and 2016 budget decisions. 
Block 40 aircraft operational testing has been delayed 6 months and 
delivery of a fully operational Block 40 capability has not been 
determined. The program fielded two Block 40 aircraft in September 
2013, providing limited capability to the warfighter. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge attained; 
* Demonstrate critical processes on a pilot production line: Knowledge 
attained; 
* Test a production-representative prototype: Knowledge attained. 

RQ-4A/B UAS Global Hawk Program: 

Technology, Design, and Production Maturity: 

The critical technologies for the RQ-4B are mature, the basic airframe 
design is stable, and its manufacturing processes are mature and in
statistical control. The RQ-4B aircraft consist of three 
configurations. Block 20 aircraft are equipped with an enhanced 
imagery intelligence payload, Block 30 aircraft have both imagery and 
signals intelligence payloads, and Block 40 aircraft have an advanced 
radar surveillance capability. The program is concurrently testing and 
fielding the multiple platform radar, the key capability for Block 40 
aircraft. Due to software delays associated with another government 
system, Block 40 operational testing has slipped an additional 9 
months, from January 2014 to October 2014, almost 4 years from the 
original estimate. Despite this, two Block 40 aircraft with the 
advanced radar capability were fielded in September 2013, providing a 
limited capability to the warfighter. Program officials stated that 
there is currently no formal date for the program to deliver a full 
capability Block 40 aircraft for operational use. 

Other Program Issues: 

As part of its fiscal year 2013 budget request, DOD proposed 
terminating the Block 30 system in an effort to reduce program cost. 
However, in January 2013, Congress directed the Global Hawk program to 
purchase its remaining three planned Block 30 aircraft and mandated 
that the Air Force maintain the operational capability of Block 30 
aircraft until December 31, 2014. The program reported that operating 
Block 30 aircraft beyond 2014 would create operational challenges and 
would require a substantial investment. According to officials, the Air
Force will make a decision about the program force structure following 
future budget decisions. If the Air Force decides to retire Block 30 
aircraft, almost half of all aircraft procured will be affected. In
September 2013, the Air Force awarded an advanced procurement contract 
for the remaining three Block 30 aircraft and intends to award a firm
fixed-price production contract in July 2014. 

The Global Hawk program continues to operate without an established 
cost and schedule baseline, as its prior baseline was rescinded due to 
the program's Nunn-McCurdy breach in April 2011. The program had 
originally planned to re-establish its baseline in June 2011, but that 
review was superseded by the Air Force's proposed termination of Block 
30. Program officials stated they are working with the Office of the 
Secretary of Defense and the Air Force to establish a new baseline. 

Production continues for Block 30 and Block 40 aircraft, despite the 
lack of an official full-rate production review. All 45 Global Hawk 
aircraft have been procured through low-rate initial production. The 
program does not plan to hold a production decision and, according to 
officials, continues to sustain operational aircraft. 

The program had planned to begin development of a restructured ground 
control station and communications system to achieve a common 
architecture for both the Global Hawk and the Navy's Triton unmanned 
aircraft systems, has a similar design to Global Hawk. However, 
according to program officials the program could no longer afford the 
development effort due to fiscal constraints. Program officials noted 
that they have chosen to continue to maintain the current system and 
address obsolescence issues on an as-needed basis. 

Program Office Comments: 

In commenting on a draft of this assessment, Air Force officials noted 
that the Air Force Operational Test and Evaluation Center completed 
the Block 40 operational utility evaluation in April 2013 in support 
of a Block 40 early operational capability. The two Block 40 aircraft 
that fielded in September 2013 were part of the early operational 
capability which provided the military with additional ground moving
target support ahead of schedule. The Air Force also provided 
technical comments, which were incorporated as appropriate. 

[End of assessment] 

Ship to Shore Connector Amphibious Craft (SSC): 

[Illustration: Source: U.S. Navy] 

The Navy's SSC is an air-cushioned landing craft intended to transport 
personnel, weapon systems, equipment, and cargo from amphibious 
vessels to shore. SSC is the replacement for the Landing Craft, Air 
Cushion, which is approaching the end of its service life. The SSC is 
designed to deploy in Navy well deck amphibious ships, such as the LPD
17 class, and for use in assault and nonassault operations. The 
program entered system development in July 2012 and is scheduled for a 
critical design review in March 2014. 

Concept: 
Program start (5/09). 

System development: 
Development start (7/12); 
GAO review (1/14); 
Design review (3/14). 

Production: 
Low-rate decision (11/14); 
Start operational test (1/17); 
Full-rate decision (9/18); 
Initial capability (8/20). 

Program Essentials: 
Prime contractor: Textron Inc.
Program office: Washington, DC; 
Funding needed to complete:
R&D: $166.8 million; 
Procurement: $3,462.9 million; 
Total funding: $3,648.9 million; 
Procurement quantity: 71. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 07/2012: $585.4; 
Latest 09/2013: $571.2; 
Percent change: -2.4. 

Procurement cost: 
As of 07/2012: $3,552.6; 
Latest 09/2013: $3,462.9; 
Percent change: -2.5. 

Total program cost: 
As of 07/2012: $4,157.6; 
Latest 09/2013: $4,053.3; 
Percent change: -2.5. 

Program unit cost: 
As of 07/2012: $56.953; 
Latest 09/2013: $55.524; 
Percent change: -2.5. 

Total quantities: 
As of 07/2012: 73; 
Latest 09/2013: 73; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 07/2012: 135; 
Latest 09/2013: 135; 
Percent change: 0.0. 

The SSC program entered system development in July 2012 with its one 
critical technology—the fire suppressant system—mature. Two other
technologies designated as technology watch items leverage existing 
mature technologies, but will need to be modified for use on SSC. The
program has completed approximately 5 percent of expected design 
drawings seven months prior to critical design review scheduled for 
March 2014. Fabrication for the first two craft is scheduled to start 
three months after the critical design review. The acquisition 
strategy identified the plan to construct the first two craft 
concurrently as a risk due to the potential for design changes. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Not applicable; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

SSC Program: 

Technology Maturity: 

The SSC program's one identified critical technology, the fire 
suppression system, entered system development as mature. According to 
program officials, the prime contractor is in the process of selecting 
a subcontractor to develop this system. According to the Navy, the 
system is expected to be lighter and more environmentally friendly 
than the system for the legacy craft. 

DOD identified two other technologies—the gas turbine engine and the 
command, control, communications, computer and navigation (C4N)
system—as critical technology watch-list items because of the 
possibility new technologies would need to be developed or modified 
for SSC. According to program officials, the gas turbine engine is 
mature, but needs modifications to convert it from aircraft to 
amphibious craft usage. In addition, program officials said that the 
prime contractor has selected a subcontractor to develop the C4N 
system and believes that the technology is low risk since it will 
leverage existing code from the legacy craft. Officials expect that 
the system will provide new operational features, including a pilot/co-
pilot configuration that allows each operator to bring up the same 
display at separate consoles. 

Design Maturity: 

As of August 2013, the contractor has released 42 of the 856 
engineering drawings expected—almost 5 percent. Best practices suggest 
that completion of 90 percent of engineering drawing provides
evidence of design stability. The program plans to demonstrate the 
stability of the SSC design at the program's production readiness 
review, currently planned for May 2014—2 months after the program's 
scheduled design review. 

Fabrication of the first two craft are scheduled to begin in June 
2014. The program office does not plan to assess critical 
manufacturing processes by the start of production. Program officials 
stated that they plan to have these processes partially demonstrated 
on a pilot production line before production start, noting that the 
program has pursued low risk technologies and a low risk design effort. 

Production Maturity: 

The Navy plans to begin construction of the lead and follow-on craft 
concurrently—a strategy that has been identified as potentially risky 
due to the possibility that design changes identified in the first
test and training craft would have to be incorporated in the second 
craft during construction. Despite this risk, the SSC program 
exercised an option to construct the second craft in December 2012—3
months earlier than planned. Program officials noted that the option 
was exercised earlier to take advantage of better pricing for certain 
long-lead construction materials. Overall, the program plans to 
exercise options for a total of six craft prior to delivery of the 
test and training craft in February 2017. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office noted 
that the Ship to Shore Connector is a technically mature, low risk 
program which is proceeding toward demonstration of design maturity. A 
detail design and construction contract was awarded in July 2012. The 
shipbuilder is conducting preliminary and critical design reviews of
all major craft subsystems. The first craft's start of fabrication is 
planned for the third quarter of fiscal year 2014. The program office 
also provided technical comments which were incorporated where deemed 
appropriate. 

[End of assessment] 

Small Diameter Bomb Increment II (SDB II): 

[Illustration: Source: © 2009 Raytheon Company] 

The Air Force's Small Diameter Bomb Increment II (SDB II) is designed 
to provide attack capability against mobile targets in adverse weather 
from standoff range. It combines radar, infrared, and semiactive laser 
sensors in a tri-mode seeker to acquire, track, and engage targets. It 
uses airborne and ground data links to update target locations as well 
as GPS and an inertial navigation system to ensure accuracy. SDB II 
will be integrated with F-15E, Joint Strike Fighter (JSF), F/A-18E/F, 
F-16C, and F-22A, as funding becomes available. 

Concept: 
Program start (5/06). 

System development: 
Development start (7/10); 
Design review (1/11); 
GAO review (1/14). 

Production: 
Low-rate decision (8/14); 
Initial capability F-15E (1/17); 
Full-rate decision (6/20); 
Initial capability JSF (9/20). 

Program Essentials: 
Prime contractor: Raytheon; 
Program office: Eglin AFB, FL; 
Funding needed to complete:
R&D: $612.3 million; 
Procurement: $2,175.3 million; 
Total funding: $2,787.6 million; 
Procurement quantity: 17,000. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 10/2010: $1,729.7; 
Latest 08/2013: $1,649.5; 
Percent change: -4.6. 

Procurement cost: 
As of 10/2010: $3,215.2; 
Latest 08/2013: $2,177.3; 
Percent change: -32.3. 

Total program cost: 
As of 10/2010: $4,944.9; 
Latest 08/2013: $3,826.7; 
Percent change: -22.6. 

Program unit cost: 
As of 10/2010: $0.288; 
Latest 08/2013: $0.223; 
Percent change: -22.6. 

Total quantities: 
As of 10/2010: 17,163; 
Latest 08/2013: 17,163; 
Percent change: 0.0. 

Acquisition cycle time (months): 
As of 10/2010: 72; 
Latest 08/2013: 79; 
Percent change: 9.7. 

The SDB II Program expects all of its critical technologies to reach 
full maturity by the time it enters low-rate production, which is 
planned to occur no earlier than August 2014—a 7-month delay from 
earlier estimates. The flight test program has experienced two 
failures, prompting a 6 month halt to flight testing in mid-2013. Since
resuming flight test activities in October 2013, the program has 
conducted three successful flight tests. Although the design is 
stable, future design changes may be needed to address problems found 
in previous flight test failures. The flight test schedule is 
optimistic, requiring seven successful flight tests in 5 months. If 
additional flight test failures occur it could result in additional 
delays for the low-rate production decision. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Knowledge attained; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

SDB II Program: 

Technology Maturity: 

SDB II's four critical technologies—guidance and control, multi-mode 
seeker, net ready data link, and payload—are scheduled to reach full 
maturity when the program has its low-rate production decision in 
August 2014, 4 years after the program entered system development. 
According to program officials, critical technologies have not directly
contributed to any flight test failures. 

Design Maturity: 

The number of design drawings is stable and the program has completed 
five successful guided flight tests. However, the flight test program 
experienced two failures that resulted in a 6-month halt in all guided 
test vehicle events until the program determined a root cause for the 
failures. The two failures were the result of the dome cover not 
deploying, preventing the seeker from acquiring the target, and a 
navigation error. Guided flight test activities resumed in October 
2013 and, since then, the program has recorded three successful flight
tests. Program officials stated that all of the failed tests have to 
be retested at a future date. Moreover, prior to the low-rate 
production decision, the program's test plan requires 11 successful 
flight tests, including two live fire events. 

Production Maturity: 

The program's low-rate production decision is expected no earlier than 
August 2014, a 7-month slip due to a delay in the program's system
verification review, a prerequisite for this decision. The 
verification review will evaluate all of the program's flight tests 
and the system qualification testing. Eleven of the 12 subsystems have
successfully passed qualification testing. However, all up round 
environmental qualification testing has been on hold since September 
2013 due to subsystem issues. 

According to program officials, the seeker subsystem is the final 
subsystem to complete qualification. The subsystem qualification was
halted for issues related to a leak in the warhead case and seeker 
encoders that failed during vibration testing. A correction has been 
identified for the encoders and will be incorporated before testing 
resumes. The all up round qualification program has been placed on 
hold until the leak in the warhead case is resolved. The program has 
yet to identify a correction for the leak in the warhead. These delays
have absorbed the entire 1-month qualification testing margin and 
contributed to the delayed system verification review, now scheduled 
for May 2014. According to program officials, the contractor will be 
adding additional vehicles to the all up round qualification program 
to lessen the effect that the pause has on the overall program 
schedule. 

Other Program Issues: 

The program's test schedule prior to the low-rate production decision 
is optimistic. In addition to a 5-month delay in 2012, the test 
program recently ended a 6-month delay due to two flight test failures.
According to program officials, the test program must have six 
successful flight tests prior to the May 2014 verification review. 
Additional flight test failures would likely further delay the low-
rate production decision. Program officials also noted that future 
sequestration funding cuts may result in reduced production quantities 
or the inability to exercise contract options. This could force a
renegotiation with the contractor for the first five production lots 
and the program could lose money that it saved through competition. 

Program Office Comments: 

The Air Force concurred with this assessment. The Air Force also 
provided technical comments, which were incorporated as appropriate. 

[End of assessment] 

Space Fence: 

[Illustration: Source: U.S. Air Force] 

The Air Force's Space Fence program is developing a system of large 
ground-based radars that will replace the Air Force Space Surveillance 
System, which became operational in 1961 and was recently shut down. 
Space Fence will use higher radio frequencies to detect and track more 
and smaller earth-orbiting objects than is currently possible. The Air 
Force currently plans to award a contract for construction of one 
radar with an option for a second. 

Concept: 
Program start (3/09); 
GAO review (1/14). 

System development: 
Development start (5/14). 

Production: 
Final development/production contract (5/14); 
Design review (2/15); 
Start operational test (6/18); 
Initial capability (11/18). 

Program Essentials: 
Prime contractor: TBD; 
Program office: Hanscom AFB, MA; 
Funding needed to complete:
R&D: $958.2 million; 
Procurement: $103.2 million; 
Total funding: $1,061.4 million; 
Procurement quantity: 1. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of: NA; 
Latest 10/2013: $1,565.2; 
Percent change: NA. 

Procurement cost: 
As of: NA; 
Latest 10/2013: $103.3; 
Percent change: NA. 

Total program cost: 
As of: NA; 
Latest 10/2013: $1,668.5; 
Percent change: NA. 

Program unit cost: 
As of: NA; 
Latest 10/2013: $1,668.463; 
Percent change: NA. 

Total quantities: 
As of: NA; 
Latest 10/2013: 1; 
Percent change: NA. 

Acquisition cycle time (months): 
As of: NA; 
Latest 10/2013: 116; 
Percent change: NA. 

The Space Fence program has seven critical technologies, which are 
expected to demonstrate full maturity during or after the critical 
design review. The program delayed development start and awarding of 
the system development contract to May 2014, a delay of almost 2 
years. As a result, the program delayed initial operational capability 
by a year to November 2018. DOD budget reductions also led to the 
early shutdown of the Air Force Space Surveillance System, which was 
originally planned to be operational through Space Fence's initial 
operations. A new data processing system is being developed by the
Air Force, separate from Space Fence, to accommodate the projected 
increase in the volume of data generated. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Not applicable; 
* Test a system-level integrated prototype: Not applicable. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable;. 

Space Fence Program: 

Technology Maturity: 

All seven of the program's critical technologies are currently nearing 
full maturity and are not expected to demonstrate full maturity until 
the critical design review, scheduled for 9 months after development 
start, or later. According to program officials, the critical 
technologies are not particularly challenging advances in technology. 
The risk for the program is in deploying radars on the very large 
scale needed. The program's technology development phase included 
competitive development of two fully working prototypes by separate 
contractors to reduce program risk. If a second radar site is deemed 
necessary, the technologies used for that site may differ, depending 
on the final program design. 

Design and Production Maturity: 

The contract for the final Space Fence system development contract has 
not yet been awarded, so the program does not have a final system design
and thus we did not assess design or production maturity. 

Other Program Issues: 

The Air Force plans to competitively award a single system development 
and production contract in May 2014. This date reflects the second 
significant delay to contract award from the original date of July 
2012. The first delay was due to an internal DOD program review 
required before the contract proposal could be issued. The program 
office attributes the additional delay in awarding the contract and 
initiating development to the strategic choices management review, 
which looked at affordability of future acquisitions DOD-wide. 

The Air Force plans to award a fixed-price incentive contract for 
system development activities for the first radar site, with a 
contract option for the second site. If the option for the second site 
is exercised, it is planned to be operational 36 months after the 
program meets initial operational capability. However, funding for the 
second site is uncertain, and it potentially may not be needed 
depending on whether the first site exceeds its design capability.
Program officials stated that the decision on whether or not to build 
a second site will likely be made after the first site is operational. 
In addition, the program has pushed back the anticipated initial 
operational capability date by more than a year, to 2018. 

The Air Force Space Surveillance System, the legacy system that Space 
Fence will replace, ended operations in October 2013. The Air Force 
originally intended to keep that system functioning until Space Fence 
became operational. According to the Air Force, the decision to end 
operations early was made due to funding constraints caused by 
sequestration. Air Force officials said they have modified the 
operations of other space surveillance assets in a way that will 
maintain a roughly equivalent level of space surveillance until Space 
Fence is operational. 

The Joint Space Operations Center (JSpOC) at Vandenberg AFB is 
acquiring a new data processing capability—JSpOC Mission System (JMS)—
to process the increased volume of data expected from Space Fence. JMS 
is being developed through a separate acquisition program and, 
according to Space Fence program officials, is required to process the 
amount of data Space Fence is expected to generate. Currently, JMS is
scheduled to become operational by December 2016, enabling input and 
processing of data from Space Fence in time for its initial operational
capability. 

Program Office Comments: 

In commenting on a draft of this assessment, the program office noted 
that the Office of the Secretary of Defense chose to delay the Space 
Fence system development certification in light of the strategic 
choices Management review outcomes. The Air Force amended the Space 
Fence request for proposals issued in November 2013. This amendment 
reflects the change to the initial operational capability delivery 
date, specified as 56 months after contract award (first quarter 
fiscal year 2019), as well as a full operational capability date,
specified as 36 months after initial operational capability (first 
quarter fiscal year 2022). It also reflects an update to the total 
projected budget to more closely reflect the current fiscal reality. 
Having resumed source selection, award of a single fixed price 
incentive contract is expected in the third quarter of fiscal year 
2014. The program also provided technical comments, which were 
incorporated where appropriate. 

[End of assessment] 

Warfighter Information Network-Tactical Increment 2 (WIN-T Inc 2): 

[Illustration: Source: U.S. Army] 

WIN-T is the Army's high-speed and high-capacity backbone 
communications network. It connects units with higher levels of 
command and provides the Army's tactical portion of the Global 
Information Grid. WIN-T was restructured following a March 2007 Nunn-
McCurdy unit-cost breach of the critical threshold, and will be 
fielded in four increments. We assessed the second increment, which is 
expected to provide the Army with an initial networking on-the-move 
capability. 

Concept: 

System development: 
Program/development start (6/07); 
Design review (2/08). 

Production: 
Low-rate decision (2/10); 
Initial operational testing (5/12); 
Follow-on operational test (5/13); 
Initial capability (8/13); 
GAO review (1/14); 
Follow-on operational test (10/14); 
Full-rate decision (5/15). 

Program Essentials: 
Prime contractor: General Dynamics C4 Systems, Inc. 
Program office: Aberdeen Proving Ground, MD; 
Funding needed to complete:
R&D: $22.3 million; 
Procurement: $2,285.1 million; 
Total funding: $2,307.3 million; 
Procurement quantity: 661. 

Program Performance (fiscal year 2014 dollars in millions): 

The Army was directed in September 2013 to update the cost position 
and program baseline. These changes are not reflected in the latest 
column above. 

Research and development cost: 
As of 10/2007: $250.9; 
Latest 08/2013: $296.6; 
Percent change: 18.2. 

Procurement cost: 
As of 10/2007: $3,649.2; 
Latest 08/2013: $4,749.6; 
Percent change: 30.2. 

Total program cost: 
As of 10/2007: $3,900.2; 
Latest 08/2013: $5,046.2; 
Percent change: 29.4. 

Program unit cost: 
As of 10/2007: $2.060; 
Latest 08/2013: $2.341; 
Percent change: 13.6. 

Total quantities: 
As of 10/2007: 1,893; 
Latest 08/2013: 2,156; 
Percent change: 13.9. 

Acquisition cycle time (months): 
As of 10/2007: 50; 
Latest 08/2013: 74; 
Percent change: 48.0. 

WIN-T Increment 2 entered production in February 2010 with mature 
critical technologies and, according to program office metrics, a stable
design, but before bringing manufacturing processes under control. A 
recent assessment of the program's manufacturing readiness levels 
indicates that these processes are now demonstrated and under control 
as the program approaches full rate production. However, during its 
May 2012 initial operational test, the program did not demonstrate 
required performance and reliability. A follow-on operational test in 
May 2013 showed improved reliability and performance but revealed that 
deficiencies remain. Consequently, the milestone decision authority 
has delayed the full rate production decision until the Army completes 
an additional follow-on operational test and confirms that 
deficiencies have been corrected. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Information not 
available; 
* Test a system-level integrated prototype: Knowledge attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Knowledge attained; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Knowledge attained. 

WIN-T Increment 2 Program: 

Technology Maturity: 

All 15 WIN-T Increment 2 critical technologies were mature by its 
February 2010 production decision. In August 2012, an independent 
manufacturing readiness assessment prepared by the Army concluded that 
the prime contractor had achieved an acceptable level of technology 
maturity to continue to full rate production. 

Design Maturity: 

According to the WIN-T program, it has integrated and tested its key 
technologies and subsystems to demonstrate that the system's design is 
capable of working as intended. The program office does not track the 
metric we use to measure design maturity—the number of releasable 
drawings—as WIN-T is primarily an information technology integration 
effort. Instead, design performance is measured through a series of 
component, subsystem, configuration item, and network-level tests 
designed to demonstrate performance at increasing levels of system 
integration. Design stability is measured through problem-tracking
report trends. 

Production Maturity: 

The WIN-T Increment 2 program began production in February 2010 and 
began testing a production-representative prototype 13 months later in 
March 2011. The program indicates that its manufacturing processes—as 
determined by an Army manufacturing readiness assessment—are now in
control, but had not yet been demonstrated or brought in control at 
production start. During its May 2012 initial operational test, the 
program did not demonstrate required performance and reliability. A
follow-on operational test in May 2013 showed improved reliability and 
performance but revealed that deficiencies remain. In particular, 
three of the program's nine configuration items were assessed as not 
operationally effective and two were not operationally suitable due to 
complexity of operations and reliability problems. In addition, the
program demonstrated cyber security vulnerabilities that need 
improvement. Consequently, the milestone decision authority has 
delayed a full rate production decision until the Army completes an 
additional follow-on operational test in November 2014 as part of the 
Army's Network Integration Evaluation 15.1 that confirms that 
deficiencies have been corrected. A full-rate production decision is
planned for May 2015. 

Other Program Issues: 

While the milestone decision authority has not yet approved a full-
rate production decision, the Army declared that the program attained 
its initial capability in August 2013. This decision was based on the 
Army's assertion that initial operational capability was reached when 
the first brigade combat team and its division headquarters was 
equipped and fully trained with the new equipment and the follow on 
operational test had been successfully completed. However, as noted 
above, the May 2013 follow-on operational test revealed deficiencies 
with the program that must be corrected and these corrections must be 
confirmed during an additional follow-on operational test. 

Program Office Comments: 

In commenting on a draft of this assessment, the Army noted that in 
September 2013, it received approval from the Defense Acquisition 
Board for an additional low-rate initial production lot and an 
acceptance to field existing lots of WIN-T Increment 2. The Army has 
fielded five Brigade Combat Teams and two divisions, and remains on 
track to field Capability Set 14 to units, including Stryker Brigade
Combat Teams. Using soldier feedback from theater and test results, 
the Army intends to continue to improve WIN-T Increment 2 capabilities 
with the primary focus being on simplifying the operations and 
maintenance of the equipment. The program office also provided 
technical comments, which were incorporated where deemed appropriate. 

[End of assessment] 

Warfighter Information Network-Tactical Increment 3 (WIN-T Inc 3): 

[Illustration: Source: U.S. Army] 

WIN-T is the Army's high-speed and high-capacity backbone 
communications network. It connects units with higher levels of 
command and provides the Army's tactical portion of the Global 
Information Grid. WIN-T was restructured following a March 2007 Nunn-
McCurdy unit-cost breach of the critical threshold, and will be 
fielded in four increments. We assessed the third increment, which is 
expected to provide the Army a full networking on-the-move capability. 

Concept: 

System development: 
Program/development start (7/03); 
Design review (12/13); 
GAO review (1/14). 

Production: 
Low-rate decision (TBD); 
Start operational test (TBD); 
Full-rate decision (TBD); 
Initial capability (TBD). 

Program Essentials: 
Prime contractor: General Dynamics C4 Systems, Inc.
Program office: Aberdeen Proving Ground, MD; 
Funding needed to complete:
R&D: $728.0 million; 
Procurement: $12,850.7 million; 
Total funding: $13,578.7 million; 
Procurement quantity: 3,449. 

Program Performance (fiscal year 2014 dollars in millions): 

Research and development cost: 
As of 05/2009: $2,826.4; 
Latest 08/2013: $2,563.0; 
Percent change: -9.3. 

Procurement cost: 
As of 05/2009: $14,387.9; 
Latest 08/2013: $12,850.7; 
Percent change: -10.7. 

Total program cost: 
As of 05/2009: $17,214.3; 
Latest 08/2013: $15,413.7; 
Percent change: -10.5. 

Program unit cost: 
As of 05/2009: $4.944; 
Latest 08/2013: $4.388; 
Percent change: -11.3. 

Total quantities: 
As of 05/2009: 3,482; 
Latest 08/2013: 3,513; 
Percent change: 0.9. 

Acquisition cycle time (months): 
As of 05/2009: 165; 
Latest 08/2013: 199; 
Percent change: 20.6. 

The Army is restructuring the program. Changes to the program's costs, 
quantities, and schedule from this restructuring are not reflected in 
the latest column above. 

According to an Army representative, 12 of WIN-T Increment 3's 18 
current critical technologies are mature and 6 are nearing maturity 
following the critical design review of the program in December 2013. 
However, the program is being restructured based on the 
recommendations of a configuration steering board held in November 
2013. This restructuring could affect the program's need for certain 
critical technologies. The program does not use the number of design 
drawings released or alternative methods to assess design stability.
However, the program plans to begin capturing software design 
stability metrics once a baseline system design is established. 

Attainment of Product Knowledge: 

As of January 2014: 

Resources and requirements match: 
* Demonstrate all critical technologies in a relevant environment: 
Knowledge attained; 
* Demonstrate all critical technologies in a realistic environment: 
Knowledge not attained; 
* Complete preliminary design review: Knowledge attained. 

Product design is stable: 
* Release at least 90 percent of design drawings: Information not 
available; 
* Test a system-level integrated prototype: Knowledge not attained. 

Manufacturing processes are mature: 
* Demonstrate critical processes are in control: Not applicable; 
* Demonstrate critical processes on a pilot production line: Not 
applicable; 
* Test a production-representative prototype: Not applicable. 

WIN-T Increment 3 Program: 

Technology Maturity: 

According to an Army representative, 12 of the program's 18 current 
critical technologies are mature, and 6 are nearing maturity following 
the critical design review of the program in December 2013. However, 
in January 2014 the Army acquisition executive directed the program
executive officer with oversight of the WIN-T Increment 3 program to 
restructure the program based on the recommendations of the Army's
configuration steering board. 

The program's restructuring could affect its need for certain critical 
technologies. For example, the Army's configuration steering board has
recommended descoping the air tier from the program. According to an 
Army representative, the program will need to complete a follow-on 
critical design review once it has been restructured, at which point 
the critical technologies will need to be reassessed. 

Design Maturity: 

The program does not use the number of design drawings released or any 
alternative methods to assess design stability. According to the 
program office, the number of design drawings is not meaningful as WIN-
T is not a manufacturing effort, but a software development and hardware
integration effort. The program asserts that it has appropriate 
software metrics and tracks design stability through its configuration 
management software production plan. 

Other Program Issues: 

According to an Army representative, the Army is in the process of 
conducting a "network capability" review to determine the "right 
mix"of tactical networking capabilities to provide to brigade combat
teams. In addition, the program is awaiting the final assessments from 
the Army's recently completed configuration steering board. These two 
events will factor into the scope of the restructured program. 
According to an Army representative, restructuring considerations may 
include maximizing the use of the capabilities currently being fielded 
under the WIN-T Increment 2 program while maintaining focus on WIN-T 
Increment 3 network operations efforts and balancing affordability, as 
DOD and the Army face long-term budgetary challenges. 

Program Office Comments: 

In commenting on a draft of this assessment, the Army noted that as of 
early 2014, the WIN-T Increment 3 program is anticipating a final 
program assessment from the Department following the program's 
critical design review and is also awaiting Department's approval of a 
program transition strategy based on the WIN-T Increment 3 
configuration steering board meeting held in November 2013. These 
events, coupled with ongoing Army tactical network capability review
decisions, will provide guidance on the scope of the program's effort 
going forward. 

[End of assessment] 

Airborne and Maritime/Fixed Station Joint Tactical Radio System (AMF 
JTRS): 

[Illustration: Source: U.S. Army] 

The Army's AMF JTRS program plans to acquire two non-developmental 
software-defined radios, the Small Airborne Link 16 Terminal (SALT) 
and the Small Airborne Networking Radio (SANR), and associated 
equipment for integration into Army rotary wing and unmanned aerial 
systems. Previously, the program had been developing software-defined 
radios and associated equipment for integration into nearly 160 
different types of aircraft, ships, and fixed stations to increase
communications and networking capabilities. 

Current Status: 

The Under Secretary of Defense for Acquisition, Technology, and 
Logistics, in July 2012, restructured the AMF JTRS program due to 
concerns about the potential for unbounded cost increases, and continued
schedule and contractor performance risk. Market research also 
determined that non-developmental items could be modified to meet 
users' revised needs and priorities. The Under Secretary also 
transferred responsibility for program management to the Army. While 
the use of a non-developmental item approach will likely reduce some 
technical risk, the Army will need to manage the integration of 
government-developed waveforms into the non-developmental item radios 
and the radios into various platforms. 

AMF JTRS now plans to acquire two non-developmental software-defined 
radios. The SALT is designed to be a 2-channel radio capable of 
running the Link 16 waveform and the Soldier Radio Waveform (SRW). The
program plans to introduce production hardware into the Apache AH-64E 
assembly line in fiscal year 2016. Until then, according to program 
officials, the Apache program office is pursuing an interim solution, 
the Small Tactical Terminal (STT), which will run only Link 16. The 
Army acquisition strategy for SALT calls for full and open 
competition. The Army plans to release the SALT request for proposals 
in the second quarter of fiscal year 2014 and a full rate production 
decision is scheduled for fiscal year 2016. 

The SANR is designed as a 2-channel radio capable of running the SRW, 
Single Channel Ground and Airborne Radio System waveform, and the 
Wideband Networking Waveform. The SANR acquisition strategy plans a 
full and open competition to select two contractors for SANR test 
assets. A low rate initial production decision is scheduled for fiscal 
year 2016 and full rate production is scheduled for fiscal year 2018. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars):
Total program: $3,582.7 million; 
Research and development: $1,849.3 million; 
Procurement: $1,733.4 million; 
Quantity: 15,652 channels. 

Next Major Program Event: SALT full-rate production and SANR low-rate 
initial production decisions in first quarter 2016. 

Program Office Comments: The program office concurred with the 
assessment. 

[End of assessment] 

Amphibious Combat Vehicle (ACV): 

[Illustration: Source: U.S. Marine Corps] 

The Marine Corps' ACV is intended to transport troops from ship to 
shore and secure a beachhead. The Marine Corps has a requirement to 
replace the existing amphibious assault vehicle (AAV) but the 
Secretary of Defense terminated the initial effort, the Expeditionary 
Fighting Vehicle (EFV) program, in January 2011 due to technology 
problems, development delays, and cost increases. 

Current Status: 

A December 2011 materiel development decision memorandum directed that 
a "highly tailored" approach be used to acquire the ACV and that this 
effort focus on a cost-effective solution, emphasizing engineering and
design analysis through establishment of affordability targets. 
According to officials, the Marine Corps completed an ACV analysis of 
alternatives (AOA) in July 2012 and the Navy forwarded it to the 
Office of the Secretary of Defense. According to ACV program 
officials, although high-water speed had been a primary requirement 
for the EFV, it was not part of the initial ACV AOA study. Instead, 
the study was based on a speed requirement that was about half of the 
EFV's, which would make the ACV a "displacement" vehicle more similar 
in water speed to the AAV. Marine Corps leadership subsequently 
directed that the affordability of a high-water speed amphibious 
vehicle be studied before the ACV began acquisition. This feasibility
analysis is ongoing. 

Officials reported that the Marine Corps is studying trade-offs in ACV 
capability to find the ACV design that will provide improvements in 
amphibious capability-speed, range, lethality, and survivability-over 
the current amphibious vehicle at an affordable cost. They added that, 
following the feasibility analysis, the Marine Corps Commandant will 
make a decision on whether the ACV acquisition program will formally 
begin at technology development or system development. Expectations 
are that the ACV will not reach initial operating capability before 
2023. To address the delay in fielding an amphibious vehicle to 
replace the legacy AAVs, 392 current AAVs will undergo survivability 
upgrades that will address deficiencies in survivability. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars):
Total program: TBDl 
Research and development (fiscal years 2012-2017): $1,047.1 million; 
Procurement: TBD; 
Acquisition related operation and maintenance (fiscal years 2012-
2017): $18.9 million; 
Quantity: TBD; 
Next Major Program Event: System development start, TBD. 

Program Office Comments: The Marine Corps was provided a draft of this 
assessment and did not offer any comments. 

[End of assessment] 

Armored Multi-Purpose Vehicle (AMPV): 

[Illustration: Source: U.S. Army] 

The Army's Armored Multi-Purpose Vehicle (AMPV) fleet is the proposed 
replacement to the M113 family of vehicles in the armored brigade 
combat team. The AMPV will replace the M113 in five mission roles: 
general purpose, medical evacuation, medical treatment, mortar 
carrier, and mission command. The Army has determined that development 
of the AMPV is necessary due to mobility deficiencies identified in 
the M113, as well as space, weight, power and cooling limitations that 
prevent the incorporation of future technologies. 

Current Status: 

Based on direction at the August and November 2013 defense acquisition 
board reviews, AMPV's acquisition strategy was updated and approved 
before a request for proposals was released in November 2013. The 
program's acquisition strategy is based on modifying an existing 
platform and bypasses the technology development phase to begin in 
system development. The program is still working to define key 
technologies, and as a result, will require potential contractors to 
include data related to the technology maturity of their design in 
each proposal. AMPV's acquisition strategy also calls for selection of 
a single contractor for system development, and provides for three low-
rate initial production options within the system development 
contract. The program currently plans to award a cost plus incentive 
fee contract for system development with a fixed price incentive 
option for low-rate initial production. The AMPV contract will include 
engineering and manufacturing development and low-rate initial 
production incentives for cost and reliability. 

Procurement of AMPV, with an estimated total acquisition cost of up to 
$10.2 billion, will occur at about the same time as the Army's Joint 
Light Tactical Vehicle program. The procurement of these programs is
expected to continue for a decade or more. 

Estimated Total Program Cost and Quantity (fiscal year 2014 dollars): 
Total Program: $10,223 million; 
Research and development: $779.9 million; 
Procurement: $9,443.0 million; 
Quantity: 2,907. 

Next Major Program Event: Start of system development, first quarter 
fiscal year 2015. 

Program Office Comments: In commenting on a draft of this assessment, 
the program office provided technical comments, which were 
incorporated where deemed appropriate. 

[End of assessment] 

B-2 Defensive Management System Modernization (B-2 DMS): 

[Illustration: Source: U.S. Air Force] 

The Air Force's B-2 DMS modernization program is expected to upgrade 
the aircraft's analog defensive management system to a digital 
capability to detect, identify and avoid threats. The modernization is
intended to update pilot displays and enhance the in-flight capability 
to avoid unanticipated air defense threats. Improvement in frequency 
coverage, sensitivity of the electronic warfare suite, and reliability 
and maintainability are also anticipated. The latter is expected to 
improve the B-2's readiness rate. 

Current Status: 

In October 2012, the program entered a second technology development 
phase, which continued throughout 2013. The program had scheduled a 
preliminary design review prior to beginning system development in 
April 2014, but officials told us they are currently restructuring the 
program due to expected future budget reductions. Program 
documentation indicates moderate technical risk due to the program's
schedule and nuclear hardening activities. Also, the antenna design, 
the software schedule, and the availability of test aircraft are risk 
areas. Early in the program, an independent assessment identified six
critical technologies; however, currently the program does not believe 
any critical technologies exist. Another independent technology 
readiness assessment, scheduled prior to system development, will
identify the final list of critical technologies. 

We have previously reported that the program was implementing a rapid 
acquisition initiative to reduce its acquisition time by up to 3 years 
and lower costs by as much as $500 million. To achieve these results, 
several activities were planned including: early software prototyping, 
reducing the time required for flight testing, and improving antenna 
installation times. By conducting these activities, it was anticipated 
the program might take 7 years to complete and cost $1.58 billion. 
While some parts of the initiative have yielded positive results, 
including a subcontractor competition for antenna development that 
officials told us saved time and money, the program's start of 
development, flight testing, and full operational capability have
all been delayed. The program now expects to complete acquisition in 
almost 9 years at a cost of over $2 billion, which means most of the 
expected reductions in cost and schedule from the initiative will not be
realized. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total program: $2,036 million; 
Research and development: $1,385 million; 
Procurement: $651 million; 
Quantity: 20. 

Next Major Program Event: System development start, April 2014. 

Program Office Comments: In commenting on a draft of this assessment, 
DOD officials told us the assessment is accurate based on the fiscal 
year 2014 budget. They added that the B-2 DMS modernization program 
remains the top B-2 modernization priority. The program office also 
provided technical comments which were incorporated as appropriate. 

[End of assessment] 

Combat Rescue Helicopter (CRH): 

[Illustration: Source: 2013 Sikorsky Aircraft Corp. Used with 
permission for support of CRH] 

The Air Force's Combat Rescue Helicopter (CRH) program, formerly 
called HH-60 Recapitalization, is an effort to replace aging HH-60G 
Pave Hawk helicopters. The CRH's primary mission is to recover 
personnel from hostile or denied territory; it will also conduct 
humanitarian, civil search and rescue, disaster relief, and non-
combatant evacuation missions. The program is the second effort to 
replace the HH-60G. The first, the Combat Search and Rescue 
Replacement Vehicle (CSAR-X), was canceled because of cost concerns in 
2009. 

Current Status: 

The Air Force expects that the CRH will be an existing helicopter with 
modifications to integrate mature technology subsystems and associated 
software. The CRH program received its materiel development decision 
in March 2012 and DOD authorized the program to bypass technology 
development and enter the acquisition process at system development. 
The program successfully completed a defense acquisition board review 
in September 2012 which approved its acquisition strategy and release 
of a request for proposals for a full and open competition in October 
2012. Depending upon the availability of future funding, the CRH 
program office plans to enter system development in March 2014, 
delayed from the originally scheduled August 2013. The program is 
preparing to then award a fixed price incentive firm target 
development contract to Sikorsky, which was the only contractor who 
responded to the request for proposals. However, the program does not 
intend to conduct any systems engineering technical reviews until 
after the development contract is awarded. According to officials from 
the Office of the Secretary of Defense, the program was granted a 
waiver in late 2012 to conduct its preliminary design review after the
start of system development, as well as a waiver for the requirement 
to conduct competitive prototyping. In our previous work, we have 
found that acquisition programs which successfully complete robust 
systems engineering early in the acquisition process and conduct a 
preliminary design review prior to starting system development 
typically have better outcomes. Initial operational capability for the 
helicopter is expected in the fourth quarter of fiscal year 2019. 

Estimated Total Program Cost (fiscal year 2014 dollars): 
Total program: TBD; 
Research and development (fiscal years 2012-2018): $1,310.9 million; 
Procurement (fiscal years 2016-2018): $2,187.7 million; 
Military construction: TBD; 
Acquisition operations and maintenance: TBD; 
Total quantity: 112. 

Next Major Program Event: System development start, March 2014. 

Program Office Comments: In commenting on a draft of this assessment, 
the program office provided technical comments, which were 
incorporated where deemed appropriate. 

[End of assessment] 

Common Infrared Countermeasure (CIRCM): 

[Illustration: Sources: © 2011 BAE Systems (left); Northrop Grumman 
(right)] 

The Army's CIRCM, the next generation of the Advanced Threat Infrared 
Countermeasures (ATIRCM), will be used with a missile warning system 
and a countermeasure dispenser capable of employing expendables, such 
as flares and chaff, to defend aircraft from infrared-guided missiles. 
The CIRCM program will develop a laser-based countermeasure system for 
rotary-wing, tilt-rotor, and small fixed-wing aircraft across DOD. 
CIRCM is one of three subprograms that make up the ATIRCM/CMWS major 
defense acquisition program. 

Current Status: 

The CIRCM program began in 2009 when the Under Secretary of Defense 
for Acquisition, Technology and Logistics supported the Army's 
decision to restructure the ATIRCM/CMWS program. In June 2009, the Army
received approval to award five contracts to provide prototype systems 
for testing. After testing these prototypes, the Army concluded that 
the systems were not mature enough for entry into system development. 
The Army subsequently decided that the program should proceed with a 
technology development phase that will include additional prototyping 
efforts to further mature CIRCM technologies and awarded two contracts 
in January 2012. 

The Army held preliminary design reviews in July and August, 2013 with 
both contractors. The review report stated that the system's 
preliminary design satisfies the operational and suitability 
requirements. Also, the Army recently conducted a preliminary 
technology readiness assessment based on contractor testing in which 
nine critical technology elements were identified and are approaching 
full maturity leading up to system development. A final technology 
readiness assessment will be conducted prior to development to
verify technology and design maturity and will be based on government-
witnessed testing. 

In October 2013, the two CIRCM contractors completed prototypes 
deliveries. According to the Army, both designs are mature and are low 
risk of not meeting the specified requirements even with the current
configurations. The Army plans to make a system development decision 
in December 2014 and plans to award one contractor a cost plus fixed 
fee/firm fixed price contract with technical performance incentives
focused on achievement of weight and reliability goals. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total Program: $3,599.8 million; 
Research and development: $788.8 million; 
Procurement: $2,811.0 million; 
Quantity: 1,076. 

Next Major Program Event: System development start, December 2014. 

Program Office Comments: In commenting on a draft of this assessment, 
the program office provided technical comments, which were 
incorporated where deemed appropriate. 

[End of assessment] 

DDG 51 Destroyer (DDG 51): 

[Illustration: Source: Bath Iron Works] 

The DDG 51 destroyer is a multimission ship designed to operate 
against air, surface, and subsurface threats. After a nearly 4-year 
break, the Navy restarted Flight IIA production and plans to buy at 
least nine ships between fiscal years 2013 and 2017. The Navy plans to 
procure three Flight III ships, a modification of the Flight IIA design,
beginning in fiscal year 2016. Flight III is expected to have an 
increased focus on missile defense and will include the Air and 
Missile Defense Radar (AMDR), initially an S-band radar developed under
a separate program. 

Current Status: 

Four DDG 51 Flight IIA ships are under construction and an additional 
nine ships are under contract. The design of the Flight IIA ships will 
be modified to include an upgraded Aegis combat system currently being 
developed. The Navy will also replace the existing SPS-67 radar with 
SPQ-9B, currently installed on several Navy ships, beginning in fiscal 
year 2014. The Navy believes that it has largely resolved issues with
production of a new reduction gear. 

DDG 51 Flight III ships are expected to feature new electric plants, 
new air-conditioning plants, and the AMDR. According to the Navy, the 
new electric plants are based on a design used on DDG 1000 and 
modification will be required for integration with DDG 51. The DDG 
1000 electrical system has faced delays in completing testing. Detail 
design work for Flight III will begin at the end of fiscal year 2014, 
according to the Navy. Adding AMDR to DDG 51 will result in a 
significant redesign of the ship and the Navy expects that Flight III 
will result in changes to more than 25 percent of Flight IIA drawings, 
although the Navy believes many of these will be minor alterations. 
The Navy will need AMDR's design assumptions, such as its size, shape, 
weight, and power and cooling requirements in order to accurately 
redesign the ship. However, the Navy only recently awarded a contract 
for AMDR system development and the AMDR program is at least 6 months 
behind schedule. Based on its current schedule, the Navy plans to 
begin detail design work for Flight III at the end of fiscal year 2014—
before AMDR has demonstrated full maturity-adding risk and uncertainty 
to the DDG 51 program. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total program (fiscal years 2010 to 2018): $23,089.5 million; 
Research and development (fiscal years 2010 to 2018): $900 million; 
Procurement (fiscal years 2010 to 2018): $22,189.6 million; 
Quantity: 15. 

Next Major Program Event: Defense acquisition board review of Flight 
III modifications, third quarter fiscal year 2014. 

Program Office Comments: According to program officials, the Flight 
III schedule integrates all equipment development efforts into the 
overall ship detail design effort. This is the same process successfully
implemented on previous flight upgrades. Due to the AMDR technology 
development phase, which produced working 1000-element arrays, the 
current design maturity supports commencement of detail design. Flight 
III is on track to be implemented on the second fiscal year 2016 ship. 

[End of assessment] 

F-15 Eagle Passive/Active Warning and Survivability System (F-15 
EPAWSS): 

[Illustration: Source: U.S. Air Force] 

The Air Force's F-15 EPAWSS program is intended to upgrade the 
electronic warfare system on fielded F-15 aircraft. The program seeks 
to improve the aircraft's internal self-protection electronic warfare 
systems to enable operations in current and future threat 
environments. The program is also expected to improve the F-15's 
survivability by enhancing its ability to detect, identify, locate, 
deny, degrade, disrupt, and defeat air and ground threat systems. 

Current Status: 

In November 2012, the Office of the Under Secretary of Defense for 
Acquisition, Technology, and Logistics approved the Air Force's plans 
to conduct an analysis of alternatives and to award a pre-engineering 
and manufacturing development characterization contract for the F-15 
EPAWSS program, which occurred in fiscal year 2013. The Air Force 
plans to leverage non-developmental electronic warfare technologies and
components, currently used in other Air Force and Navy aircraft, to 
create a state-of-the-art wide bandwidth digital electronic warfare 
system capable of protecting the F-15 aircraft against advanced enemy 
threats. The Air Force is currently updating the program's 
requirements documentation and intends to conduct a preliminary design 
review before starting system development in fiscal year 2016. The 
program office plans to award a production contract in fiscal year 2018.
An early Air Force assessment of F-15 EPAWSS identified digital 
receiver technology—both the hardware and the associated software—as a 
critical technology that the program does not intend to fully mature 
prior to the start of system development. According to program 
officials, a key risk is integration of the electronic warfare system 
with all other on-board and off-board systems, so that it operates 
properly in its intended operational environment. The program expects 
to add future capabilities as new electronic warfare threats emerge. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total program: TBD; 
Research and development: $614.9 million (fiscal years 2014 to 2018); 
Procurement: TBD; 
Quantity: 392. 

Next Major Program Event: Defense acquisition board review of 
acquisition strategy, February 2014. 

Program Office Comments: According to the Air Force, the program 
office continues to refine the planning for the F-15 EPAWSS program 
based on in-work requirements documentation and final acquisition 
strategy approval by the Milestone Decision Authority. 

[End of assessment] 

Ground Combat Vehicle (GCV): 

[Illustration: Source: U.S. Army] 

The Ground Combat Vehicle (GCV) is an incremental program to replace 
segments of the Army's combat vehicle inventory. The first variant is
intended to be the service's next infantry fighting vehicle, replacing 
a portion of the current M2 Bradley fleet. The Army expects GCV to 
provide a full-spectrum capability to perform offensive, defensive, 
stability, and support operations; carry a nine-soldier squad; 
emphasize force protection; and be operational within 7 years of 
beginning technology development. 

Current Status: 

In August 2011, the Under Secretary of Defense for Acquisition, 
Technology, and Logistics approved GCV's entry into technology 
development. The Army awarded contracts to two contractor teams, but 
resolving a bid protest prevented the start of technology development 
until December 2011. Since then, the Army has been involved in three 
activities: updating the analysis of alternatives, assessing upgrades 
to existing vehicles, and funding two contractors' efforts to build 
and demonstrate key subsystem prototypes. 

On January 16, 2013, the Under Secretary directed a number of changes 
to the program, including extending the technology development phase 
six months, delaying both system development and production, and 
directing that a single prime contractor be selected for system 
development. These actions provide significant reductions to the 
funding necessary to execute the program. 

An independent review team identified three candidate critical 
technologies—all nearing full maturity—that could be incorporated into 
the GCV design. The program will continue monitoring these 
technologies and consider their maturity and risk as part of the full 
and open competition planned for system development. Since our last 
report, both contractors continued technology development by maturing 
preliminary designs and subsystems, completing multiple tests of their 
respective mine blast protection designs, and testing engines and 
drive trains. After holding preliminary design reviews to determine 
whether the proposed designs could satisfy requirements, a defense 
acquisition board will determine the program's readiness to proceed 
into system development, which is expected to begin in June 2014.The 
Army plans to begin procuring GCV while simultaneously procuring other 
new and costly combat vehicles including the Joint Light Tactical 
Vehicle. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total program: $29,219.6 million; 
Research and development: $4,968.5 million; 
Procurement: $24,229.1 million; 
Quantity: 12 (development), 1,874 (procurement). 

Next Major Program Event: System development start, June 2014. 

Program Office Comments: According to officials in the office of the 
Under Secretary of Defense for Acquisition, Technology, and Logistics, 
the GCV program was canceled on the order of the Secretary of Defense. 

[End of assessment] 

Indirect Fire Protection Capability-Increment 2 (IFPC Inc 2): 

[Illustration: Source: U.S. Army] 

The Army's IFPC Increment 2 consists of three blocks, each a separate 
major defense acquisition program, to detect, assess, and defend against
threats from rockets, artillery, mortars, cruise missiles, and 
unmanned aircraft. The first IFPC increment, fielded in 2004, provides 
a short-range capability to counter rockets, artillery, and mortar 
threats. IFPC Increment 2, Block 1 establishes the capability to 
counter cruise missiles and unmanned aircraft. The remaining blocks 
add to and extend the range and capability. 

Current Status: 

In 2004, after the first increment of IFPC was fielded, users 
developed a new requirement to counter unmanned aircraft and cruise 
missiles. The Surface Launched Advanced Medium-Range Air-to-Air Missile
was originally set to fulfill this requirement, but was canceled. To 
replace it, in 2011, the Army proposed a new interceptor, launcher, 
and radar. The $1.6 billion estimate for developing this new system, 
however, was deemed unaffordable. The Army then proposed a three block 
alternative, each a separate major defense acquisition program, which 
leverages an existing interceptor and sensor and competitively awards 
the development of a new launcher. Block 1 is scheduled for fielding 
in fiscal year 2019. The review to begin technology development for 
Block 1 was held October 22, 2013, but final approval is pending until 
January 2014 due to budget concerns, including sequestration, 
according to officials. Program officials noted that the most 
significant risk is integration with the existing systems being 
leveraged, such as the AIM 9 Class Interceptor and the Sentinel radar. 
Successful integration is necessary to avoid increased costs or overall
failure to meet requirements. According to program officials, the 
program is reusing existing technologies to promote affordability and 
using open systems architecture for the launcher to enable it to work 
with a variety of current and future missiles. Blocks 2 and 3 are 
scheduled to begin development in fiscal years 2019 and 2027, 
respectively. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total program: $2.5 billion; 
Research and development: $510 million; 
Procurement: $2.0 billion; 
Quantity: 5 (development), 344 (procurement). 

Next Major Program Event: System requirement review, January 2014. 

Program Office Comments: In commenting on a draft of this assessment, 
the program office provided technical comments, which were 
incorporated where deemed appropriate. 

[End of assessment] 

Joint Air-to-Ground Missile (JAGM): 

[Illustration: Source: U.S. Army] 

The Joint Air-to-Ground missile is an Army-led program with joint 
requirements from the Navy and Marine Corps. The missile is designed 
to be air-launched from helicopters and unmanned aircraft systems to 
target tanks; light armored vehicles; missile launchers; command, 
control, and communications vehicles; bunkers; and buildings. It
is intended to provide line-of-sight and beyond line-of-sight 
capabilities and deploy in a fire-and-forget mode or a precision 
attack mode. JAGM will replace all variants of HELLFIRE missiles. 

Current Status: 

In early 2012, the Army restructured JAGM extending technology 
development by more than 2 years to explore evolutionary alternatives 
to the acquisition strategy, refine requirements and explore a more
affordable solution. In August and November 2012, the Army awarded 
letter contracts to Lockheed Martin and Raytheon for this extended 
technology development. Program officials stated that these efforts 
focus on the guidance section, the key technology that provides the 
capabilities required by the Army, Marine Corps, and Navy. Preliminary 
design reviews of each contractor's design were held in February and 
April 2013, respectively. 

The Assistant Secretary of the Army for Acquisition, Technology, and 
Logistics conducted a program status review informed by the 
preliminary design reviews to assess the program's cost, schedule, and 
performance risk. Based on funding shortfalls of $36 million and 
findings of the risk assessment, in August 2013, the Assistant 
Secretary of the Army for Acquisition, Technology, and Logistics 
directed the JAGM program to execute the continued technology 
development phase with a single contractor in order to meet technology
development objectives on schedule. According to program officials, 
Raytheon's technical performance was not on track to meet program 
goals or Army requirements. As a result, the government did not award a
follow-on contract to extend performance after April 2013. Lockheed 
Martin will continue with technology development under their existing 
contract. Upon completion of all objectives and technology development
exit criteria, approval of the acquisition strategy, and completion of 
the source selection evaluation board, the Army is planning for a 
system development decision in fiscal year 2015. The acquisition 
strategy will allow for a competitive contract award for system 
development. 

Estimated Total Program Cost and Quantity (fiscal year 2014 dollars): 
Total Program: TBD; 
Research and development (fiscal years 2008-2018): $656.4 million; 
Procurement (fiscal years 2008 to 2018): $116.8 million; 
Quantity: 167. 

Next Major Program Event: Subcomponent critical design review, January 
2014. 

Program Office Comments: In commenting on a draft of this assessment, 
the program office provided technical comments, which were 
incorporated where deemed appropriate. 

[End of assessment] 

Joint Land Attack Cruise Missile Defense Elevated Netted Sensor System 
(JLENS): 

[Illustration: Source: U.S. Army] 

The Army's JLENS is designed to provide elevated, persistent, over-the-
horizon surveillance and fire control quality data enabling protection 
of U.S. and coalition forces and critical assets. A JLENS orbit 
consists of two systems: a fire control radar system and a 
surveillance radar system. Each system is comprised of a 74-meter 
tethered aerostat, a mobile mooring station, communication and 
processing stations, and ground support equipment. The program was 
restructured following a Nunn-McCurdy unit-cost breach of the critical 
threshold. 

Current Status: 

In August 2013, the Under Secretary of Defense for Acquisition, 
Technology, and Logistics approved the program's revised acquisition 
program baseline, re-designated the program's acquisition category and
delegated milestone decision authority to the Secretary of the Army. 
The JLENS program satisfied developmental testing and evaluation 
requirements and is proceeding with plans to execute a 3-year
operational combatant command exercise. The exercise is expected to 
demonstrate JLENS capabilities for homeland defense and inform a 
future decision for enduring operational employment. 

The program reported that recent operational test events at the Utah 
Test and Training Range and at the White Sands Missile Range 
demonstrate that JLENS performs as expected. Phase two of the second 
early user test—which assessed system performance and reliability and 
allowed for soldier training on system configuration—was successfully 
completed in June 2013, and, according to program officials, liminated 
the need for the third series of developmental tests. Integrated fire 
control testing occurred in July 2013 and demonstrated JLENS 
capabilities in acquiring, tracking and providing sensor track data. 
The program will need to complete "friend or foe" identification 
system and communication link certification events before it can 
participate in the exercise. Site construction for the deployment of 
the exercise will begin at Aberdeen Proving Ground after the February 
2014 construction contract award. The construction will involve
completing aerostat pads, roads, operation and support facilities, and 
infrastructure. The initial system is expected to arrive at the 
exercise site location in June 2014 and initial capability delivery is 
expected for the surveillance radar in September 2014 and the fire 
control radar system in December 2014. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars):
Total program: $2,782.12 million; 
Research and development: $2,741.61 million; 
Military construction: $40.51 million; 
Quantity: 2. 

Next Major Program Event: February 2014 construction contract award 
for exercise site construction. 

Program Office Comments: In commenting on a draft of this assessment, 
the program office provided technical comments, which were 
incorporated where deemed appropriate. 

[End of assessment] 

Military GPS User Equipment (MGUE), Increment 1: 

[Illustration: Source: U.S. Air Force] 

The Air Force's MGUE program plans to develop GPS receivers compatible 
with the military's next-generation GPS signal, Military-Code. The
modernized receivers are to provide U.S. forces with enhanced 
position, navigation, and time capabilities, while improving 
resistance to existing and emerging threats, such as jamming. The
program is to be completed in two increments. Increment 1, assessed 
here, leverages technologies from the Modernized User Equipment (MUE) 
program to develop two variants and begin development of the Common 
GPS Module. 

Current Status: 

In April 2012, the Air Force initiated technology development for 
Increment 1 of MGUE. According to the Air Force, all five critical 
technologies identified by the Office of the Secretary of Defense—
military-code acquisition engine, military-code cryptography, 
selective availability/anti-spoofing module cryptography, anti-
spoofing, and anti-tamper-are currently nearing maturity. The Air 
Force plans to develop two variants—one each for ground and aviation, 
as Navy officials believe the aviation variant can support maritime 
needs. The current approved Increment 1 program leverages technologies 
from the Modernized User Equipment program to develop two variants and 
begin development of the Common GPS Module. Increment 2 is not yet 
approved. 

The program's preliminary design review has been delayed 5 months, to 
June 2014. According to officials, the delay was caused by two 
factors: sequestration of fiscal year 2013 MGUE funding, which forced 
the program to limit contractor activity, and a new initiative to 
reduce complexity within the cryptography required to encrypt and 
decrypt communications. In last year's assessment, the program 
reported two main risk areas, ensuring more than one contractor meets 
design requirements for the application specific integrated circuit 
(ASIC)—a vital component leveraged from MUE—and software development. 
According to Air Force officials, progress in manufacturing and 
testing the ASIC as well as the complexity reduction effort has
largely addressed these risk areas. However, the program identified a 
new risk in obtaining security certification to field GPS receivers in 
unclassified environments. According to officials, however, neither the
delay in the preliminary design review nor the risk areas is expected 
to delay the program's entry into system development, scheduled for 
November 2014. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars):
Total program: TBD; 
Research and development: $1,658.0 million; 
Procurement: TBD; 
Quantity: 124 (development), 550 (production). 

Next Major Program Event: Preliminary design review, April 2014
Program Office Comments: In commenting on a draft of this assessment, 
the Air Force affirmed that it continues to strive to field military-
code GPS receivers as quickly as possible. The service has leveraged
previous technology and industry experience to mitigate risk and 
reduce cost, and seeks additional opportunities to streamline the MGUE 
acquisition. The program office also provided technical comments,
which have been incorporated where appropriate. 

[End of assessment] 

Next Generation Jammer (NGJ): 

[Illustration: Source: U.S. Navy] 

The Navy's Next Generation Jammer (NGJ) is being developed as an 
external jamming pod system fitted on carrier-based EA-18G Growler 
aircraft. It will replace the ALQ-99 jamming pod system and
provide enhanced airborne electronic attack capabilities to disrupt 
and degrade enemy air defense and ground communication systems. The 
Navy plans to field capabilities in three increments for different 
radio frequency ranges beginning with Increment 1 (mid-band) in 2020 
with Increments 2 and 3 (low- and high-band) to follow. We assessed
Increment 1. 

Current Status: 

In July 2013, DOD approved NGJ Increment 1's entry into technology 
development; however, work was delayed when GAO sustained a protest 
related to the technology development contract award. Prior to 
technology development, the Navy completed a 33-month technology 
maturation phase, during which the Navy selected four contractors to 
prototype key technologies and subsystems related to their proposed NGJ
Increment 1 concept. According to program officials, each contractor 
chose the technologies to prototype during technology maturation, but 
they generally aligned with five critical technology areas—power
generation and distribution, exciters, beam formers, amplifiers, and 
apertures. DOD believes that these prototyping activities meet the 
competitive prototyping requirements of the Weapon Systems Acquisition
Reform Act of 2009, which require competitive prototyping for MDAPs 
before system development unless a waiver is granted. The program 
office stated it is also planning to use open systems architecture to 
enhance future competitions and to provide flexibility for upgrades. 

Following technology maturation, the Navy awarded a single $280 
million contract to Raytheon for technology development with plans to 
award a sole-source follow-on contract to complete system development 
for Increment 1. In October 2011, the Navy stated that it expected to 
save about $641 million by using only one contractor for technology 
development. In November 2013, GAO sustained portions of BAE Systems' 
protest of the contract award and recommended that the Navy document a 
reevaluation of the proposals and a cost/technical tradeoff analysis. 
In January 2014, the Navy reaffirmed Raytheon's contract award and 
resumed NGJ's technology development efforts after a 6-month delay, 
but faces a $100 million funding reduction. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total program: $6,336.3 million; 
Research and development: $2,894.6 million; 
Procurement: $3,442.7 million; 
Quantity: 9 (development), 114 (procurement). 

Next Major Program Event: System development start, second quarter 
fiscal year 2016. 

Program Office Comments: The NGJ program office provided technical 
comments, which were incorporated as appropriate. The Navy is 
reviewing its schedule to identify actions to maintain its fiscal year
2020 fielding date for NGJ Increment 1. 

[End of assessment] 

Ohio-Class Replacement (OR): 

[Illustration: Source: © 2012 General Dynamics Electric Boat] 

The Navy's Ohio-class Replacement (OR) will replace the current fleet 
of Ohio-class ballistic missile submarines (SSBNs) as they begin to 
retire in 2027. The Navy began technology development in January 2011 
in order to avoid a gap in sea based nuclear deterrence between the 
Ohio-class's retirement and the production of a replacement. The Navy 
is working with the United Kingdom to develop a common missile 
compartment for use on OR and the United Kingdom's replacement SSBN. 
OR will initially carry the Trident II D5LE missile. 

Current Status: 

Navy officials stated that they are pursuing design for affordability 
initiatives and investigating various contracting and acquisition 
scenarios to reduce average follow-on ship procurement costs from an
estimated $5.6 to $4.9 billion (in fiscal year 2010 dollars).The 
program intends to maximize economic order quantity benefits by 
leveraging the Virginia-class program and the elements common with the 
United Kingdom's SSBN. Program officials stated the OR and Virginia-
class programs are aligned to support various contracting scenarios, 
including procuring the lead OR concurrently in a multi-year 
procurement with the Block V Virginia-class contract. The Navy would 
develop a legislative proposal in 2017 to support this approach. The 
lead ship would likely not meet multi-year procurement criteria that 
require a stable design that has typically completed initial 
operational test and evaluation. The Navy has set initial 
configurations for areas including the torpedo room, bow, and stern. 
In 2014, the program expects to complete initial specifications, set 
ship length—a major milestone—and start detailed system descriptions and
arrangements. The contractor plans to build a notional submarine 
section to validate the fidelity of its new design tool. The program 
plans to have 83 percent of design disclosures (including drawings, 
and material procurement and construction planning information) and 
100 percent of arrangements and the three-dimensional product model 
completed prior to the start of lead ship construction scheduled for 
fiscal year 2021. Program officials stated that unmitigated, a 
sequestration of 2014 funds would result in up to a one year delay to 
the program (potentially creating a gap in sea-based nuclear 
deterrence), but that they will attempt to mitigate any delays to the 
fullest extent allowed. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total program: $95,103.2 million; 
Research and development: $11,718.2 million; 
Procurement: $83,385.0 million; 
Quantity: 12. 

Next Major Program Event: System requirements review, fiscal year 2014. 

Program Office Comments: According to the program office, the OR 
program multi-year-procurement decision has not been made at this 
time. The OR program intends to maximize savings from cross-class
contracting with the Virginia-class and the United Kingdom's Successor-
class to take advantage of benefits from economic order quantity. The 
OR program is currently conducting analysis on multi-year-procurement
and other contracting scenarios. 

[End of assessment] 

Presidential Aircraft Recapitalization (PAR): 

[Illustration: Source: U.S. Air Force] 

The Air Force's Presidential Aircraft Recapitalization (PAR) program 
is intended to recapitalize the VC-25A system and support the United 
States President as Head of State, Chief Executive, and Commander in 
Chief. PAR's principal mission is to provide the President and his 
staff air transportation with the same level of security and 
communications capability available at the White House. 

Current Status: 

PAR program acquisition strategy development is ongoing with milestone 
decision authority approval expected in the fourth quarter of fiscal 
year 2015. According to program officials, the program intends to
acquire a large, commercial-derivative aircraft and modify it to meet 
desired capabilities. The program intends to seek a waiver from the 
requirement to conduct competitive prototyping prior to entry into
engineering and manufacturing development. To ensure some form of 
competition, the program plans to use open architecture for future 
upgrades. 

Since fiscal year 2012, the PAR program has conducted initial planning 
activities including assessing risk and systems engineering as well as 
analysis related to requirements, sustainment, and technology and
manufacturing maturity. Risk reduction studies are planned to continue 
through fiscal year 2014. 

The PAR system development start and contract award are expected in 
the fourth quarter of fiscal year 2015. Program officials reported 
that at present, the Air Force is still determining the number of 
aircraft needed to replace the current VC-25A fleet and no decision 
has been made on PAR fleet size. The first aircraft will be used to 
support research, development, test, and evaluation. Once the 
development is completed, the aircraft will be delivered as a fully 
capable aircraft to support presidential missions in fiscal year 2023. 
Additional deliveries will commence starting in fiscal year 2025. 
According to program officials, requirements are being finalized with 
Air Mobility Command but at the time of our review, critical 
technologies have not yet been identified. Officials reported that 
program affordability is under discussion, but no targets for the 
final program cost have been determined yet. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total program: TBD; 
Research and development (fiscal years 2010 through 2018): $1,075.9 
million; 
Procurement: TBD; 
Quantity: TBD. 

Next Major Program Event: Milestone decision authority approval of 
acquisition strategy, fourth quarter fiscal year 2015. 

Program Office Comments: Technical comments were incorporated as 
appropriate. 

[End of assessment] 

Space Based Infrared Satellite System (SBIRS High): 

[Illustration: Source: © 2007 Lockheed Martin] 

The Air Force's SBIRS High satellite system is being developed to 
replace the Defense Support Program and perform a range of missile 
warning, missile defense, technical intelligence, and battlespace 
awareness missions. SBIRS High will consist of four satellites in 
geosynchronous earth orbit (GEO), two sensors on host satellites in 
highly elliptical orbit (HEO), two replenishment satellites and 
sensors, and fixed and mobile ground stations. We assessed the space 
segment and made observations about the ground segment. 

Current Status: 

Both HEO sensors and the first two GEO satellites have been launched. 
One of two replenishment sensors was delivered to the host this year 
for integration, and the third and fourth satellites are currently in
production. In October 2013, the first GEO satellite was accepted as 
operational, with previously identified issues resolved. This means 
that the data returned from the satellite is reliable. The second 
satellite was accepted for operations in November 2013. Each GEO 
satellite carries a scanning sensor and a staring sensor, which 
provide different data to meet program missions. The program launched 
the first satellite without event recovery software intended to re-
establish ground control of the satellite in the event of an 
unforeseen failure, so that other software issues could be addressed. 
Given successful recovery software testing on the second GEO 
satellite, the Air Force plans to upload the software to the first 
satellite in the fourth quarter of 2014. 

The Block 10 software ground system increment is expected to be 
delivered in March 2016, and is intended to facilitate processing of 
integrated data from the Defense Support Program satellites, HEO 
sensors and GEO satellites now on-orbit. According to the program, 
this software delivery will also provide the capability for fully-
tuned starer sensor data, which means that the data returned from the 
satellites will be cleared of background noise, such as irrelevant 
light sources. This capability was previously planned for inclusion in a
subsequent Block 20 software delivery which is expected to achieve 
certification in June 2018. The program plans to fully meet 
operational requirements in 2019 once it has established the full on-
orbit constellation of HEO sensors, four GEO satellites, completion of 
Blocks 10 and 20, and delivery of its mobile ground assets. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total Program: $18,886.4 million; 
Research & development: $11,805.5 million; 
Procurement: $6,817.2 million; 
Quantity: 6. 

Next Major Program Event: Third GEO satellite available for delivery 
December 2015. 

Program Office Comments: In commenting on a draft of this assessment, 
program officials noted that the first and second satellites are 
operationally accepted by US Strategic Command. The third is expected 
early, but will need to be stored. The ground system, and fourth 
sensor and satellite are on-track. The fifth and sixth satellite 
production contract is expected fiscal year 2014. 

[End of assessment] 

Three-Dimensional Expeditionary Long-Range Radar (3DELRR): 

[Illustration: Source: U.S. Air Force] 

The Air Force's 3DELRR is being developed as a long-range, ground-
based sensor for detecting, identifying, tracking, and reporting 
aircraft and missiles for the Joint Forces Air Component Commander. It 
is intended to provide real-time data and support a range of 
expeditionary operations in all types of weather and terrain. It is 
being acquired to replace the Air Force's AN/TPS-75 radar systems. 

Current Status: 

The 3DELRR program entered technology development in May 2009, and 
these efforts included capability demonstrations of three competing 
prototypes. The program is scheduled to enter system development in
June 2014 after it completes the source selection process for its 
development and initial production contract. The acquisition strategy 
for the program has changed in the last year. The program previously 
planned to award the system development and low-rate initial 
production contract using full and open competition. However, when the 
Air Force released the request for proposals for this contract in 
November 2013, the program limited the competition to the three 
contractors that had developed full-scale prototypes and completed a 
preliminary design review—Lockheed Martin, Northrop Grumman, and 
Raytheon. According to program officials, including other contractors 
would require more development funding to reach maturity and these 
costs would not likely be recouped through full and open competition. 
However, the program plans to take other steps, such as obtaining data 
rights, to maintain the ability to introduce competition for 
subsystems and upgrades later. The maximum total ceiling price for the 
planned contract is $534 million, which includes an option for low-
rate initial production. 

The 3DELRR program will enter system development with its critical 
technologies nearing maturity. The program office reported that 3DELRR 
successfully demonstrated its eight critical technologies and its
manufacturing processes in a relevant environment during its 
technology development efforts. According to the program office, the 
greatest risk to program execution is budget uncertainty. 

Estimated Total Program Cost and Quantity (fiscal year 2014 dollars): 
Total Program: $1,531.4 million; 
Research and development: $543.4 million; 
Procurement: $988.1 million; 
Quantities: 35. 

Next Major Program Event: System development start, June 2014 Program 
Office Comments: The program office concurred with this assessment. 

[End of assessment] 

Unmanned Carrier-Launched Airborne Surveillance and Strike (UCLASS) 
System: 

[Illustration: Source: U.S. Navy] 

The Navy's UCLASS system is expected to address a gap in persistent 
sea-based intelligence, surveillance, and reconnaissance (ISR) with
precision strike capabilities. The system is made up of three key 
segments an unmanned aerial vehicle, aircraft carrier modifications, 
and a control system. Working together these segments will provide
aircraft carriers with additional ISR as well as targeting and strike 
capabilities. 

Current Status: 

In June 2013, the Under Secretary of Defense for Acquisition, 
Technology, and Logistics approved the Navy's plan to invest an 
estimated $3.7 billion through fiscal year 2020 to develop, produce, 
and field an initial UCLASS system with up to 24 air vehicles and 
modify up to four aircraft carriers, to support an early operational 
capability. The Navy plans to manage UCLASS as a technology 
development program, and does not plan to hold a formal review to 
enter system development until after an initial system is fielded in
fiscal year 2020. Normally, activities like those planned by the Navy 
are commensurate with an acquisition program in system development and 
early production. Using this approach, the Navy is considering seeking 
approval to bypass a formal system development phase and proceed 
directly into production in fiscal year 2020 but no formal decision 
has been made. This approach raises concerns as the Navy could develop,
produce, and field a system before undergoing the key oversight 
mechanisms and reviews that typically govern a program in system 
development. 

In August 2013, the Navy awarded four separate limited source firm 
fixed-price contracts to develop designs for the air vehicle segment. 
In fiscal year 2014, the Navy plans to review those preliminary 
designs, conduct a full and open competition, and award a single 
contract to complete development and deliver the air vehicles. UCLASS 
is critically dependent on the development and fielding of the Joint 
Precision Approach and Landing System (JPALS), a global positioning 
system that guides aircraft onto an aircraft carrier. Navy officials 
expect UCLASS to hold a preliminary design review—including the air 
vehicle, carrier, and control segments—in May 2014 based on JPALS test 
progress. However, the Navy still considers JPALS one of its top risks 
for UCLASS. 

Estimated Program Cost and Quantity (fiscal year 2014 dollars): 
Total program: TBD; 
Research and development: $3,700 million; 
Procurement: TBD; 
Quantity: TBD. 

Next Major Program Event: Technology development start, 2014. 

Program Office Comments: According to program officials, the UCLASS 
program continues to progress toward conducting a milestone A defense 
acquisition board review in accordance with the program's approved 
technology development strategy. A milestone B decision will be sought 
and appropriate documentation submitted for review. The program also 
provided technical comments, which were incorporated as appropriate. 

[End of assessments] 

Agency Comments and Our Evaluation: 

DOD provided written comments on a draft of this report. The comments 
are reprinted in appendix VII. We also received technical comments 
from DOD, which have been addressed in the report as appropriate. 

In its comments, DOD stated that our assessment shows that the 
Department's commitment to acquisition excellence in the "Better 
Buying Power" initiatives continues to have a positive impact on the 
cost, schedule, and performance measures of the programs we assessed. 
As we note in the report, these initiatives seem to be having a 
positive effect at least in the near term. This is particularly true 
for DOD's implementation of "should-cost" reviews which many programs 
reported were responsible for significant savings. Our assessment also 
notes that there are still opportunities to find additional savings 
with two other acquisition reform efforts—affordability constraints 
and the promotion of competition before and after development start. 

Our report also emphasizes that further implementation of knowledge-
based best practices are fundamental to containing cost growth and 
ensuring timely delivery of the capabilities promised to the 
warfighter in the long term. These include early systems engineering 
reviews, mature technologies before development start, and the 
demonstration of mature designs through system-level prototyping. 

We are sending copies of this report to appropriate congressional 
committees; the Secretary of Defense; the Secretaries of the Army, 
Navy, and Air Force; and the Director of the Office of Management and 
Budget. In addition, the report will be made available at no charge on 
the GAO Web site at [hyperlink, http://www.gao.gov]. 

If you or your staff have any questions concerning this report, please 
contact me at (202) 512-4841. Contact points for our offices of 
Congressional Relations and Public Affairs may be found on the last 
page of this report. Staff members making key contributions to this 
report are listed in appendix VIII. 

Signed by: 

Michael J. Sullivan: 
Director, Acquisition and Sourcing Management: 

List of Committees: 

The Honorable Carl Levin: 
Chairman: 
The Honorable James M. Inhofe: 
Ranking Member: 
Committee on Armed Services: 
United States Senate: 

The Honorable Richard J. Durbin: 
Chairman: 
The Honorable Thad Cochran: 
Ranking Member: 
Subcommittee on Defense: 
Committee on Appropriations: 
United States Senate: 

The Honorable Howard P. "Buck" McKeon: 
Chairman: 
The Honorable Adam Smith: 
Ranking Member: 
Committee on Armed Services: 
House of Representatives: 

The Honorable Rodney Frelinghuysen: 
Chairman: 
The Honorable Pete Visclosky: 
Ranking Member: 
Subcommittee on Defense: 
Committee on Appropriations: 
House of Representatives: 

[End of section] 

Appendix I: Scope and Methodology: 

Analysis of the Cost Performance of DOD's Portfolio of Major Defense 
Acquisition Programs: 

To develop our observations on the overall changes in the size, cost, 
and cycle time of Department of Defense's portfolio of major defense 
acquisition programs, we obtained and analyzed cost, quantity, and 
schedule data from Selected Acquisition Reports (SAR) and other 
information in the Defense Acquisition Management Information 
Retrieval (DAMIR) Purview system, referred to as DAMIR.[Footnote 34] 
We converted all cost information to fiscal year 2014 dollars using 
conversion factors from the DOD Comptroller's National Defense Budget 
Estimates for Fiscal Year 2014 (table 5-9). Data for the total planned 
investment of major defense acquisition programs were obtained from 
DAMIR, which we aggregated for all programs using fiscal year 2014 
dollars. Through discussions with DOD officials responsible for the 
database and confirming selected data with program offices, we 
determined that the SAR data and the information retrieved from DAMIR 
were sufficiently reliable for our purposes. In general, we refer to 
the 80 major defense acquisition programs with SARs dated December 
2012 as DOD's 2013 or current portfolio and use a similar convention 
for prior year portfolios. We compared the programs that issued SARs 
in December 2012 with the list of programs that had issued SARs in 
December 2011 (2012 portfolio) to identify the programs that exited 
and entered the current portfolio. The Missile Defense Agency's 
Ballistic Missile Defense System is excluded from all analyses as the 
program does not have an integrated long-term baseline which prevents 
us from assessing the program's cost progress or comparing it to other 
major defense acquisition programs. 

To determine the portfolio trends over the past ten years we collected 
data from the annual December SARs for the years 2003 (2004 portfolio) 
through 2012 (2013 portfolio). The 2009 portfolio is excluded because 
no annual SARs were released for the December 2008 submission date. We 
then analyzed the data to determine the number of programs in each 
portfolio year as well as the year-by-year totals for research and 
development, procurement, and other acquisition funding for each 
portfolio year as well as the total amount of funding invested or 
remaining and, in specific cases the amount due to cost growth. We 
also used DAMIR and SAR data to make a determination of system type 
for each program to determine the mix of system types in each 
portfolio year. 

To determine the cost and schedule changes on defense acquisition 
programs in the current portfolio over the past year, 5 years, and 
from baseline estimates, we collected data from December 2012, 
December 2011, and December 2007 SARs; acquisition program baselines; 
and program offices. For programs less than a year old, we calculated 
the difference between the December 2012 SAR current estimate and the 
first full estimate to identify the cost and schedule change over the 
past year. For programs less than 5 years old, we took a similar 
approach when calculating the cost and schedule change over the past 5 
years. We retrieved data on research, development, test, and 
evaluation; procurement; total acquisition cost, and schedule 
estimates for the 80 programs in the 2013 portfolio.[Footnote 35] In 
some cases, we divided four programs into two distinct elements, 
because DOD reports performance data on them separately. As a result 
some of our analysis reflects a total of 84 programs and sub-elements. 
We analyzed the data to determine the change in research and 
development, procurement, and total acquisition costs as well as 
schedule changes from the first full estimate, generally development 
start, to the current estimate in the December 2012 SAR. For the 
programs that did not have a development estimate, we compared the 
current estimate to the production estimate. Also, for the 
shipbuilding programs that had a planning estimate, we compared the 
current estimate to the planning estimate. For programs that began as 
non-major defense acquisition programs, the first full estimate we 
used as a baseline may be different than the original baseline 
disclosed in DOD SARs. We obtained schedule information and calculated 
the cycle time from program start to initial operational capability 
and the delay in obtaining initial operational capability. For 
programs in the current portfolio where schedule data for initial 
operational capability was not available over the past year, 5 years, 
and since first full estimates we used the same methodology as used 
when calculating cost change. 

To determine whether programs experienced an increase or decreases in 
buying power over the past year, we obtained data on program 
acquisition unit cost to determine whether a program's buying power 
had increased or decreased. We reviewed SARs for those programs with 
changes in buying power over the past year to measure the extent to 
which changes in quantity impacted procurement cost changes. When 
analyzing buying power changes, we also calculated the amount of 
procurement cost growth attributable to quantity changes, we isolated 
the change in procurement quantities and the prior-year's acquisition 
procurement unit cost for programs over the past year. For those 
programs with a change in procurement quantities, we calculated the 
amount attributable to quantity changes as the change in quantity 
multiplied by the average procurement unit cost for the program a year 
ago. The resulting dollar amount is considered a change due solely to 
shifts in the number of units procured and may overestimate the amount 
of change expected when quantities increase and underestimate the 
expected change when quantities decrease as it does not account for 
other effects of quantity changes on procurement such as gain or loss 
of learning in production that could result in changes to unit cost 
over time or the use or absence of economic orders of material. 
However, these changes are accounted for as part of the change in cost 
not due to quantities. 

To evaluate program performance against high-risk criteria discussed 
by DOD, the Office of Management and Budget (OMB), and GAO, we 
calculated how many programs had less than a 2 percent increase in 
total acquisition cost over the past year, less than a 10 percent 
increase over the past 5 years, and less than a 15 percent increase 
from first full estimates using data from December 2012, December 
2011, and December 2007 SARs; acquisition program baselines; and 
program offices. For programs that began as non-major defense 
acquisition programs, the first full estimate we used as a baseline 
may be different than the original baseline contained in DOD SARs. We 
also compared the performance of the 2013 portfolio in each high-risk 
category with the performance of the 2012 and 2011 portfolios we 
reported on in prior years to identify any positive or negative 
changes. For programs with multiple sub-programs presented in the SARs 
we calculated the net effect of the sub-programs to reach an aggregate 
program result. 

To discern the cost and schedule performance of the various system 
types represented in the current portfolio, we first determined each 
program's system type using DAMIR reported information on commodity 
type, the program's mission and description summary from the December 
2012 SAR, and GAO analyst judgment. The programs were then grouped by 
system type and cost and schedule change was determined using the cost 
and schedule changes calculated for the programs in each system type. 
Development cost change and change in initial operating capability 
were then calculated for each group as elsewhere in this objective. 
For change in procurement unit cost, a weighted average calculation 
was used based on the total procurement cost for programs in each 
system type. 

To determine the funding already invested and the funding remaining 
that is needed to complete the 80 programs in the 2013 portfolio we 
used funding stream data obtained from DAMIR and the December 2012 
SARs. We define funding invested as all funding that has been provided 
to the programs in fiscal years 2013 and earlier, while funding 
remaining is all the amounts that will be provided in the fiscal year 
2014 and later. To show the amount of additional future funding needed 
due to cost growth from first full estimates to complete programs in 
the current portfolio, we compared a funding stream for each program 
that corresponded to its first full estimate at program start against 
the funding stream for the current estimate in the program's December 
2012 SAR. 

Analysis of Selected DOD Programs Using Knowledge-Based Criteria: 

To collect data from current and future major defense acquisition 
programs--including cost and schedule estimates, technology maturity, 
and planned implementation of acquisition reforms--we distributed two 
electronic questionnaires, one questionnaire for the 38 current 
programs and a slightly different questionnaire for the 18 future 
programs. Both of the questionnaires were sent by e-mail in an 
attached Microsoft Word form that respondents could return 
electronically. We received responses from all of the programs we 
assessed from August to November 2013. To ensure the reliability of 
the data collected through our questionnaires, we took a number of 
steps to reduce measurement error and non-response error. These steps 
included conducting three pretests for the future major defense 
acquisition program questionnaire and three pretests for the major 
defense acquisition program questionnaire prior to distribution to 
ensure that our questions were clear, unbiased, and consistently 
interpreted; reviewing responses to identify obvious errors or 
inconsistencies; conducting follow-up to clarify responses when 
needed; and verifying the accuracy of a sample of keypunched 
questionnaires. Our pretests covered each branch of the military to 
better ensure that the questionnaires could be understood by officials 
within each branch. 

Our analysis of how well programs are adhering to a knowledge-based 
acquisition approach focuses on 38 major defense acquisition programs 
that are mostly in development or the early stages of production. To 
assess the knowledge attained by key decision points (system 
development start or detailed design contract award for shipbuilding 
programs, critical design review or fabrication start for shipbuilding 
programs, and production start), we collected data from program 
offices about their knowledge at each point. In particular, we focused 
on the seven programs that crossed these key acquisition points in 
2013 and evaluated their adherence to knowledge based practices. We 
also provide some insight into how much knowledge is obtained at key 
junctures by other programs we assessed as well. We also included 
observations on the knowledge that 18 future programs expect to obtain 
before starting development as well as how much knowledge 14 current 
programs expect to obtain before reaching their production start. We 
did not validate the data provided by the program offices, but 
reviewed the data and performed various checks to determine that they 
were reliable enough for our purposes. Where we discovered 
discrepancies, we clarified the data accordingly. 

The 56 current and future programs included in our assessment were in 
various stages of the acquisition cycle, and not all of the programs 
provided information on knowledge obtained at each point. Programs 
were not included in our assessments at key decision points if 
relevant data were not available. For each decision point, we 
summarized knowledge attainment for the number of programs with data 
that had reached that knowledge point. Our analysis of knowledge 
attained at each key point includes factors that we have previously 
identified as being key to a knowledge-based acquisition approach, 
including holding early systems engineering reviews, testing an 
integrated prototype prior to the design review, using a reliability 
growth curve, planning for manufacturing, and testing a production-
representative prototype prior to the making a production decision. 
Additional information on how we collect these data is found in the 
product knowledge assessment section of appendix I. See also appendix 
IV for a list of the practices that are associated with a knowledge-
based acquisition approach. 

Analysis of Acquisition Initiatives and Program Concurrency: 

To determine how DOD has begun to implement acquisition reforms, we 
obtained and analyzed the revised DOD 5000.02 acquisition instruction 
in place at the time of our review, the Weapon Systems Acquisition 
Reform Act of 2009, and the September 14, 2010, Under Secretary of 
Defense for Acquisition, Technology, and Logistics memorandum on 
better buying power as well as subsequent memorandums clarifying and 
implementing that guidance, including the Better Buying Power 2.0 
memorandum. In November 2013, DOD released an interim revision of its 
5000.02 acquisition instruction with the intention of incorporating 
the policy changes mandated by the reform act and "Better Buying 
Power" memos. As our data was collected prior to the release of this 
revision we did not use the new instruction as criteria for our 
assessments. To develop our observations, we analyzed questionnaire 
data received from the 38 current and 18 future major defense 
acquisition programs in our assessment to determine the extent to 
which specific acquisition reform issues have been implemented such as 
establishing affordability constraints, conducting "should-cost" 
analyses, using competition throughout the acquisition life cycle, and 
holding configuration steering boards. 

To assess program concurrency we identified the programs--among those 
we included in our assessment--with production start dates. We used 
the questionnaire responses from those programs to identify the dates 
for the start and end of developmental testing, compared those dates 
to the timing of each program's production decision and determined the 
number of months, if any, of developmental testing done after 
production start. We then compared the number of overlapping months to 
the total number of months of developmental testing for each program 
and calculated the percentage of developmental testing done concurrent 
with production. 

Individual Assessments of Weapon Programs: 

In total, this report presents individual assessments of 56 weapon 
programs. A table listing these programs is found in appendix VIII. 
Out of these programs, 37 are captured in a two-page format discussing 
technology, design, and manufacturing knowledge obtained and other 
program issues. Thirty-four of these 37 two-page assessments are of 
major defense acquisition programs, most of which are in development 
or early production and 3 assessments are of programs that were 
projected to become major defense acquisition programs during or soon 
after our review. The remaining 19 programs are described in a one-
page format that describes their current status. Those one-page 
assessments include 15 future major defense acquisition programs, 2 
major defense acquisition program that are well into production, and 2 
major defense acquisition programs that were recently restructured or 
curtailed. Over the past several years, DOD has revised policies 
governing weapon system acquisitions and changed the terminology used 
for major acquisition events. To make DOD's acquisition terminology 
more consistent across the 56 program assessments, we standardized the 
terminology for key program events. For most individual programs in 
our assessment, "development start" refers to the initiation of an 
acquisition program as well as the start of engineering and 
manufacturing development. This generally coincides with DOD's 
milestone B. A few programs in our assessment have a separate "program 
start" date, which begins a pre-system development phase for program 
definition and risk-reduction activities. This "program start" date 
generally coincides with DOD's former terminology for milestone I or 
DOD's current milestone A. The "production decision" generally refers 
to the decision to enter the production and deployment phase, 
typically with low-rate initial production. The "initial capability" 
refers to the initial operational capability--sometimes called first 
unit equipped or required asset availability. For shipbuilding 
programs, the schedule of key program events in relation to 
acquisition milestones varies for each program. Our work on 
shipbuilding best practices has identified the detailed design 
contract award and the start of lead ship fabrication as the points in 
the acquisition process roughly equivalent to development start and 
design review for other programs. 

For each program we assessed in a two-page format, we present cost, 
schedule, and quantity data at the program's first full estimate and 
an estimate from the latest SAR or the program office reflecting 2013 
data where they were available. The first full estimate is generally 
the cost estimate established at milestone B--development start; 
however, for a few programs that did not have such an estimate, we 
used the estimate at milestone C--production start--instead. For 
shipbuilding programs, we used their planning estimates if those 
estimates were available. For systems for which a first full estimate 
was not available, we only present the latest available estimate of 
cost and quantities. For the other programs assessed in a one-page 
format, we present the latest available estimate of cost and quantity 
from the program office. 

For each program we assessed, all cost information is presented in 
fiscal year 2014 dollars. We converted cost information to fiscal year 
2014 dollars using conversion factors from the DOD Comptroller's 
National Defense Budget Estimates for Fiscal Year 2014 (table 5-9). We 
have depicted only the program's main elements of acquisition cost--
research and development and procurement. However, the total program 
cost also includes military construction and acquisition-related 
operation and maintenance costs. Because of rounding and these 
additional costs, in some situations, total cost may not match the 
exact sum of the research and development and procurement costs. The 
program unit costs are calculated by dividing the total program cost 
by the total quantities planned. In some instances, the data were not 
applicable, and we annotate this by using the term "not applicable 
(NA)." The quantities listed refer to total quantities, including both 
procurement and development quantities. 

The schedule assessment for each program is based on acquisition cycle 
time, defined as the number of months between program start and the 
achievement of initial operational capability or an equivalent 
fielding date. In some instances the data were not yet available, and 
we annotate this by using the term "to be determined (TBD)" or "NA." 

The information presented on the "funding needed to complete" is from 
fiscal year 2014 through completion and, unless otherwise noted, draws 
on information from SARs or on data from the program office. In some 
instances, the data were not available, and we annotate this by the 
term "TBD" or "NA." The quantities listed refer only to procurement 
quantities. Satellite programs, in particular, produce a large 
percentage of their total operational units as development quantities, 
which are not included in the quantity figure. 

The intent of these comparisons is to provide an aggregate, or 
overall, picture of a program's history. These assessments represent 
the sum of the federal government's actions on a program, not just 
those of the program manager and the contractor. DOD does a number of 
detailed analyses of changes that attempt to link specific changes 
with triggering events or causes. Our analysis does not attempt to 
make such detailed distinctions. 

In this year's assessment we also reviewed whether individual 
subcontracting reports from a program's prime contractor or 
contractors were accepted on the Electronic Subcontracting Reporting 
System (eSRS). We reviewed this information for 36 of the major 
defense acquisition programs included in our assessment using the 
contract information reported in their December 2012 Selected 
Acquisition Reports. See appendix VI for a list of the programs we 
reviewed. The contract numbers for each program's prime contracts were 
entered into the eSRS database to determine whether the individual 
subcontracting reports had been accepted by the government. While we 
did not assess the reliability of the eSRS database, we took steps to 
ensure that the data provided by the database was sufficiently 
reliable for the purpose of our analysis by interviewing defense 
officials with knowledge of DOD's process for eSRS and collecting data 
from program offices on contract reporting. The government uses 
individual subcontracting reports on eSRS as one method of monitoring 
small business participation, as the report includes goals for small 
business subcontracting. Not all prime contracts for major defense 
acquisition programs are required to submit individual subcontracting 
reports. For example, some contractors report small business 
participation at a corporate level as opposed to a program level and 
this data is not captured in the individual subcontracting reports. 

Product Knowledge Data on Individual Two-Page Assessments: 

In our past work examining weapon acquisition issues and best 
practices for product development, we have found that leading 
commercial firms pursue an acquisition approach that is anchored in 
knowledge, whereby high levels of product knowledge are demonstrated 
by critical points in the acquisition process. On the basis of this 
work, we have identified three key knowledge points during the 
acquisition cycle--system development start, critical design review, 
and production start--at which programs need to demonstrate critical 
levels of knowledge to proceed. To assess the product development 
knowledge of each program at these key points, we reviewed data-
collection instruments and questionnaires submitted by programs; 
however, not every program had responses to each element of the data-
collection instrument or questionnaire. We also reviewed pertinent 
program documentation and discussed the information presented on the 
data-collection instrument and questionnaire with program officials as 
necessary. 

To assess a program's readiness to enter system development, we 
collected data through the data-collection instrument on critical 
technologies and early design reviews. To assess technology maturity, 
we asked program officials to apply a tool, referred to as Technology 
Readiness Levels (TRL), for our analysis. The National Aeronautics and 
Space Administration originally developed TRLs, and the Army and Air 
Force science and technology research organizations use them to 
determine when technologies are ready to be handed off from science 
and technology managers to product developers. TRLs are measured on a 
scale from 1 to 9, beginning with paper studies of a technology's 
feasibility and culminating with a technology fully integrated into a 
completed product. See appendix V for TRL definitions. Our best-
practices work has shown that a TRL 7--demonstration of a technology 
in a realistic environment--is the level of technology maturity that 
constitutes a low risk for starting a product development program. 
[Footnote 36] For shipbuilding programs, we have recommended that this 
level of maturity be achieved by the contract award for detailed 
design.[Footnote 37] In our assessment, the technologies that have 
reached TRL 7, a prototype demonstrated in a realistic environment, 
are referred to as mature or fully mature. Those technologies that 
have reached TRL 6, a prototype demonstrated in a relevant 
environment, are referred to as approaching or nearing maturity. 
Satellite technologies that have achieved TRL 6 are assessed as fully 
mature due to the difficulty of demonstrating maturity in a realistic 
environment--space. In addition, we asked program officials to provide 
the date of the preliminary design review. We compared this date to 
the system development start date. 

In most cases, we did not validate the program offices' selection of 
critical technologies or the determination of the demonstrated level 
of maturity. We sought to clarify the TRLs in those cases where 
information existed that raised concerns. If we were to conduct a 
detailed review, we might adjust the critical technologies assessed, 
their readiness levels demonstrated, or both. It was not always 
possible to reconstruct the technological maturity of a weapon system 
at key decision points after the passage of many years. Where 
practicable, we compared technology assessments provided by the 
program office to assessments conducted by officials from the Office 
of the Assistant Secretary of Defense for Research and Engineering. 

To assess design stability, we asked program officials to provide the 
percentage of design drawings completed or projected for completion by 
the design review, the production decision, and as of our current 
assessment in the data-collection instrument. In most cases, we did 
not verify or validate the percentage of engineering drawings provided 
by the program office. We clarified the percentage of drawings 
completed in those cases where information that raised concerns 
existed. Completed drawings were defined as the number of drawings 
released or deemed releasable to manufacturing that can be considered 
the "build to" drawings. For shipbuilding programs, we asked program 
officials to provide the percentage of the three-dimensional product 
model that had been completed by the start of lead ship fabrication, 
and as of our current assessment. To gain greater insights into design 
stability, we also asked program officials to provide the date they 
planned to first integrate and test all key subsystems and components 
into a system-level integrated prototype. We compared this date to the 
date of the design review. We did not assess whether shipbuilding 
programs had completed integrated prototypes. 

To assess production maturity, we asked program officials to identify 
the number of critical manufacturing processes and, where available, 
to quantify the extent of statistical control achieved for those 
processes as a part of our data-collection instrument. In most cases, 
we did not verify or validate the information provided by the program 
office. We clarified the number of critical manufacturing processes 
and the percentage of statistical process control where information 
existed that raised concerns. We used a standard called the Process 
Capability Index, a process-performance measurement that quantifies 
how closely a process is running to its specification limits. The 
index can be translated into an expected product defect rate, and we 
have found it to be a best practice. We also used data provided by the 
program offices on their manufacturing readiness levels (MRL) for 
process capability and control, a sub-thread tracked as part of the 
manufacturing readiness assessment process recommended by DOD, to 
determine production maturity. We assessed programs as having mature 
manufacturing processes if they reported an MRL 9 for that sub-thread--
meaning, that manufacturing processes are stable, adequately 
controlled, and capable. To gain further insights into production 
maturity, we asked program officials whether the program planned to 
demonstrate critical manufacturing processes on a pilot production 
line before beginning low-rate production. We also asked programs on 
what date they planned to begin system-level developmental testing of 
a fully configured, production-representative prototype in its 
intended environment. We compared this date to the production start 
date. We did not assess production maturity for shipbuilding programs. 

Although the knowledge points provide excellent indicators of 
potential risks, by themselves they do not cover all elements of risk 
that a program encounters during development, such as funding 
instability. Our detailed reviews on individual systems normally 
provide a more comprehensive assessment of risk elements. 

We conducted this performance audit from June 2013 to March 2014, 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. 

[End of section] 

Appendix II: Current and First Full Estimates for DOD's 2013 Portfolio 
of Major Defense Acquisition Programs: 

Table 8 contains the current and first full total acquisition cost 
estimates (in fiscal year 2013 dollars) for each program or element in 
the Department of Defense's (DOD) 2013 major defense acquisition 
program portfolio. For each program we show the percent change in 
total acquisition cost from the first full estimate, as well as over 
the past year and 5 years. 

Table 8: Current Cost Estimates and First Full Estimates for DOD's 
2013 Portfolio of Major Defense Acquisition Programs: 

Fiscal year 2014 dollars in millions: 

Program name: Advanced Extremely High Frequency Satellite (AEHF); 
Current total acquisition cost: $14,559; 
First full estimate total acquisition cost: $6,700; 
Change in total acquisition cost from first full estimate: 117.3%; 
Change in total acquisition cost within the past year: -0.9%; 
Change in total acquisition cost within the past 5 years: 70.2%. 

Program name: AGM-88E Advanced Anti-Radiation Guided Missile (AGM-88E 
AARGM); 
Current total acquisition cost: $2,062; 
First full estimate total acquisition cost: $1,684; 
Change in total acquisition cost from first full estimate: 22.5%; 
Change in total acquisition cost within the past year: -0.4%; 
Change in total acquisition cost within the past 5 years: 15.1%. 

Program name: AH-64E Apache New Build (AH-64E New Build); 
Current total acquisition cost: $2,119; 
First full estimate total acquisition cost: $2,492; 
Change in total acquisition cost from first full estimate: -15.0%; 
Change in total acquisition cost within the past year: 2.9%; 
Change in total acquisition cost within the past 5 years: -15.0%. 

Program name: AH-64E Apache Remanufacture (AH-64E Remanufacture); 
Current total acquisition cost: $12,499; 
First full estimate total acquisition cost: $7,617; 
Change in total acquisition cost from first full estimate: 64.1%; 
Change in total acquisition cost within the past year: 12.9%; 
Change in total acquisition cost within the past 5 years: 50.2%. 

Program name: AIM-120 Advanced Medium Range Air-to-Air Missile 
(AMRAAM); 
Current total acquisition cost: $24,052; 
First full estimate total acquisition cost: $11,497; 
Change in total acquisition cost from first full estimate: 109.2%; 
Change in total acquisition cost within the past year: -0.9%; 
Change in total acquisition cost within the past 5 years: 23.3%. 

Program name: AIM-9X Block II Air-to-Air Missile (AIM-9X Block II); 
Current total acquisition cost: $3,793; 
First full estimate total acquisition cost: $4,202; 
Change in total acquisition cost from first full estimate: -9.7%; 
Change in total acquisition cost within the past year: -7.0%; 
Change in total acquisition cost within the past 5 years: -9.7%. 

Program name: Airborne and Maritime/Fixed Station Joint Tactical Radio 
System (AMF JTRS); 
Current total acquisition cost: $3,583; 
First full estimate total acquisition cost: $8,576; 
Change in total acquisition cost from first full estimate: -58.2%; 
Change in total acquisition cost within the past year: -12.9%; 
Change in total acquisition cost within the past 5 years: -58.2%. 

Program name: Airborne Warning and Control System Block 40/45 Upgrade 
(AWACS Blk 40/45 Upgrade); 
Current total acquisition cost: $2,865; 
First full estimate total acquisition cost: $2,936; 
Change in total acquisition cost from first full estimate: -2.4%; 
Change in total acquisition cost within the past year: -2.4%; 
Change in total acquisition cost within the past 5 years: -2.4%. 

Program name: B-2 Extremely High Frequency SATCOM and Computer 
Increment 1 (B-2 EHF Inc1); 
Current total acquisition cost: $594; 
First full estimate total acquisition cost: $747; 
Change in total acquisition cost from first full estimate: -20.5%; 
Change in total acquisition cost within the past year: -2.5%; 
Change in total acquisition cost within the past 5 years: -17.5%. 

Program name: B61 Mod 12 Life Extension Program Tailkit Assembly (B61 
Mod 12 LEP TKA); 
Current total acquisition cost: $1,369; 
First full estimate total acquisition cost: $1,375; 
Change in total acquisition cost from first full estimate: -0.5%; 
Change in total acquisition cost within the past year: -0.5%; 
Change in total acquisition cost within the past 5 years: -0.5%. 

Program name: C-130J Hercules Transport Aircraft (C-130J); 
Current total acquisition cost: $16,455; 
First full estimate total acquisition cost: $998; 
Change in total acquisition cost from first full estimate: 1548.6%; 
Change in total acquisition cost within the past year: -1.9%; 
Change in total acquisition cost within the past 5 years: 22.9%. 

Program name: C-5 Reliability Enhancement and Re-engining Program (C-5 
RERP); 
Current total acquisition cost: $7,661; 
First full estimate total acquisition cost: $11,469; 
Change in total acquisition cost from first full estimate: -33.2%; 
Change in total acquisition cost within the past year: -1.1%; 
Change in total acquisition cost within the past 5 years: -30.7%. 

Program name: CH-47F Improved Cargo Helicopter (CH-47F); 
Current total acquisition cost: $15,000; 
First full estimate total acquisition cost: $3,386; 
Change in total acquisition cost from first full estimate: 343.0%; 
Change in total acquisition cost within the past year: 0.3%; 
Change in total acquisition cost within the past 5 years: 8.7%. 

Program name: CH-53K Heavy Lift Replacement Helicopter (CH-53K); 
Current total acquisition cost: $24,806; 
First full estimate total acquisition cost: $17,414; 
Change in total acquisition cost from first full estimate: 42.5%; 
Change in total acquisition cost within the past year: 4.7%; 
Change in total acquisition cost within the past 5 years: 42.0%. 

Program name: Chemical Demilitarization-Assembled Chemical Weapons 
Alternatives (Chem Demil-ACWA); 
Current total acquisition cost: $10,496; 
First full estimate total acquisition cost: $2,779; 
Change in total acquisition cost from first full estimate: 277.7%; 
Change in total acquisition cost within the past year: -0.7%; 
Change in total acquisition cost within the past 5 years: 34.5%. 

Program name: Cooperative Engagement Capability (CEC); 
Current total acquisition cost: $5,491; 
First full estimate total acquisition cost: $3,096; 
Change in total acquisition cost from first full estimate: 77.4%; 
Change in total acquisition cost within the past year: -1.5%; 
Change in total acquisition cost within the past 5 years: 2.8%. 

Program name: Gerald R. Ford Class Nuclear Aircraft Carrier (CVN 78); 
Current total acquisition cost: $36,008; 
First full estimate total acquisition cost: $37,415; 
Change in total acquisition cost from first full estimate: -3.8%; 
Change in total acquisition cost within the past year: -0.8%; 
Change in total acquisition cost within the past 5 years: 10.5%. 

Program name: DDG 1000 Zumwalt Class Destroyer (DDG 1000); 
Current total acquisition cost: $22,000; 
First full estimate total acquisition cost: $36,602; 
Change in total acquisition cost from first full estimate: -39.9%; 
Change in total acquisition cost within the past year: 0.2%; 
Change in total acquisition cost within the past 5 years: -26.8%. 

Program name: DDG 51 Arleigh Burke Class Guided Missile Destroyer (DDG 
51); 
Current total acquisition cost: $107,831; 
First full estimate total acquisition cost: $15,974; 
Change in total acquisition cost from first full estimate: 575.0%; 
Change in total acquisition cost within the past year: 2.3%; 
Change in total acquisition cost within the past 5 years: 30.5%. 

Program name: E-2D Advanced Hawkeye Aircraft (E-2D AHE); 
Current total acquisition cost: $19,899; 
First full estimate total acquisition cost: $15,516; 
Change in total acquisition cost from first full estimate: 28.2%; 
Change in total acquisition cost within the past year: -2.3%; 
Change in total acquisition cost within the past 5 years: 17.1%. 

Program name: EA-18G Growler Aircraft (EA-18G); 
Current total acquisition cost: $13,681; 
First full estimate total acquisition cost: $9,440; 
Change in total acquisition cost from first full estimate: 44.9%; 
Change in total acquisition cost within the past year: 16.1%; 
Change in total acquisition cost within the past 5 years: 46.5%. 

Program name: Evolved Expendable Launch Vehicle (EELV); 
Current total acquisition cost: $63,924; 
First full estimate total acquisition cost: $18,276; 
Change in total acquisition cost from first full estimate: 249.8%; 
Change in total acquisition cost within the past year: 78.4%; 
Change in total acquisition cost within the past 5 years: 78.8%. 

Program name: Excalibur Precision 155mm Projectiles (Excalibur); 
Current total acquisition cost: $1,882; 
First full estimate total acquisition cost: $5,024; 
Change in total acquisition cost from first full estimate: -62.5%; 
Change in total acquisition cost within the past year: 1.0%; 
Change in total acquisition cost within the past 5 years: -25.5%. 

Program name: F/A-18E/F Super Hornet Aircraft (F/A-18E/F); 
Current total acquisition cost: $59,674; 
First full estimate total acquisition cost: $85,964; 
Change in total acquisition cost from first full estimate: -30.6%; 
Change in total acquisition cost within the past year: -1.7%; 
Change in total acquisition cost within the past 5 years: 5.8%. 

Program name: F-35 Joint Strike Fighter Aircraft (F-35); 
Current total acquisition cost: $332,320; 
First full estimate total acquisition cost: $224,775; 
Change in total acquisition cost from first full estimate: 47.8%; 
Change in total acquisition cost within the past year: -3.4%; 
Change in total acquisition cost within the past 5 years: 24.7%. 

Program name: Family of Advanced Beyond Line-of-Sight Terminals (FAB-
T); 
Current total acquisition cost: $4,618; 
First full estimate total acquisition cost: $3,354; 
Change in total acquisition cost from first full estimate: 37.7%; 
Change in total acquisition cost within the past year: -1.4%; 
Change in total acquisition cost within the past 5 years: 22.8%. 

Program name: Family of Medium Tactical Vehicles (FMTV); 
Current total acquisition cost: $19,010; 
First full estimate total acquisition cost: $10,987; 
Change in total acquisition cost from first full estimate: 73.0%; 
Change in total acquisition cost within the past year: -0.4%; 
Change in total acquisition cost within the past 5 years: -15.7%. 

Program name: Global Broadcast Service (GBS); 
Current total acquisition cost: $1,276; 
First full estimate total acquisition cost: $606; 
Change in total acquisition cost from first full estimate: 110.6%; 
Change in total acquisition cost within the past year: 2.8%; 
Change in total acquisition cost within the past 5 years: 30.8%. 

Program name: Global Positioning System III (GPS III); 
Current total acquisition cost: $4,376; 
First full estimate total acquisition cost: $4,145; 
Change in total acquisition cost from first full estimate: 5.6%; 
Change in total acquisition cost within the past year: 1.0%; 
Change in total acquisition cost within the past 5 years: 5.6%. 

Program name: Ground/Air Task Oriented Radar (G/ATOR); 
Current total acquisition cost: $2,298; 
First full estimate total acquisition cost: $1,542; 
Change in total acquisition cost from first full estimate: 49.1%; 
Change in total acquisition cost within the past year: -26.0%; 
Change in total acquisition cost within the past 5 years: 49.1%. 

Program name: Guided Multiple Launch Rocket System/Guided Multiple 
Launch Rocket System Alternative Warhead; (GMLRS/GMLRS AW); 
Current total acquisition cost: $6,520; 
First full estimate total acquisition cost: $1,860; 
Change in total acquisition cost from first full estimate: 250.6%; 
Change in total acquisition cost within the past year: 2.9%; 
Change in total acquisition cost within the past 5 years: 10.0%. 

Program name: H-1 Upgrades (4BW/4BN) (H-1 Upgrades); 
Current total acquisition cost: $12,935; 
First full estimate total acquisition cost: $3,814; 
Change in total acquisition cost from first full estimate: 239.1%; 
Change in total acquisition cost within the past year: -1.9%; 
Change in total acquisition cost within the past 5 years: 40.3%. 

Program name: HC/MC-130 Recapitalization Aircraft (HC/MC-130 Recap); 
Current total acquisition cost: $13,788; 
First full estimate total acquisition cost: $8,797; 
Change in total acquisition cost from first full estimate: 56.7%; 
Change in total acquisition cost within the past year: 2.9%; 
Change in total acquisition cost within the past 5 years: 56.7%. 

Program name: Integrated Air and Missile Defense (IAMD); 
Current total acquisition cost: $5,804; 
First full estimate total acquisition cost: $5,289; 
Change in total acquisition cost from first full estimate: 9.7%; 
Change in total acquisition cost within the past year: -4.2%; 
Change in total acquisition cost within the past 5 years: 9.7%. 

Program name: Integrated Defensive Electronic Countermeasures (IDECM); 
Current total acquisition cost: $2,582; 
First full estimate total acquisition cost: $2,290; 
Change in total acquisition cost from first full estimate: 12.7%; 
Change in total acquisition cost within the past year: 2.8%; 
Change in total acquisition cost within the past 5 years: 16.4%. 

Program name: IDECM Blocks 2/3; 
Current total acquisition cost: $1,720; 
First full estimate total acquisition cost: $1,560; 
Change in total acquisition cost from first full estimate: 10.3%; 
Change in total acquisition cost within the past year: 5.5%; 
Change in total acquisition cost within the past 5 years: 10.3%. 

Program name: IDECM Block 4; 
Current total acquisition cost: $862; 
First full estimate total acquisition cost: $730; 
Change in total acquisition cost from first full estimate: 18.0%; 
Change in total acquisition cost within the past year: -2.1%; 
Change in total acquisition cost within the past 5 years: 18.0%. 

Program name: Joint Air-to-Surface Standoff Missile - JASSM and JASSM-
Extended Range (JASSM); 
Current total acquisition cost: $7,223; 
First full estimate total acquisition cost: $2,438; 
Change in total acquisition cost from first full estimate: 196.3%; 
Change in total acquisition cost within the past year: -1.2%; 
Change in total acquisition cost within the past 5 years: 16.1%. 

Program name: Joint Direct Attack Munition (JDAM); 
Current total acquisition cost: $7,448; 
First full estimate total acquisition cost: $3,596; 
Change in total acquisition cost from first full estimate: 107.1%; 
Change in total acquisition cost within the past year: 2.9%; 
Change in total acquisition cost within the past 5 years: 18.2%. 

Program name: Joint Land Attack Cruise Missile Defense Elevated Netted 
Sensor System (JLENS); 
Current total acquisition cost: $2,782; 
First full estimate total acquisition cost: $7,011; 
Change in total acquisition cost from first full estimate: -60.3%; 
Change in total acquisition cost within the past year: 0.6%; 
Change in total acquisition cost within the past 5 years: -61.9%. 

Program name: Joint Light Tactical Vehicle (JLTV); 
Current total acquisition cost: $23,651; 
First full estimate total acquisition cost: $23,700; 
Change in total acquisition cost from first full estimate: -0.2%; 
Change in total acquisition cost within the past year: -0.2%; 
Change in total acquisition cost within the past 5 years: -0.2%. 

Program name: Joint Precision Approach and Landing System Increment 1A 
(JPALS Inc 1A); 
Current total acquisition cost: $1,124; 
First full estimate total acquisition cost: $1,065; 
Change in total acquisition cost from first full estimate: 5.6%; 
Change in total acquisition cost within the past year: 8.4%; 
Change in total acquisition cost within the past 5 years: 5.6%. 

Program name: Joint Primary Aircraft Training System (JPATS); 
Current total acquisition cost: $5,999; 
First full estimate total acquisition cost: $3,918; 
Change in total acquisition cost from first full estimate: 53.1%; 
Change in total acquisition cost within the past year: -0.8%; 
Change in total acquisition cost within the past 5 years: -3.8%. 

Program name: Joint Standoff Weapon - Baseline Variant and Unitary 
Warhead Variant (JSOW); 
Current total acquisition cost: $5,739; 
First full estimate total acquisition cost: $8,359; 
Change in total acquisition cost from first full estimate: -31.3%; 
Change in total acquisition cost within the past year: -0.6%; 
Change in total acquisition cost within the past 5 years: 10.7%. 

Program name: JSOW - Baseline Variant; 
Current total acquisition cost: $2,353; 
First full estimate total acquisition cost: $3,004; 
Change in total acquisition cost from first full estimate: -21.7%; 
Change in total acquisition cost within the past year: -0.2%; 
Change in total acquisition cost within the past 5 years: 0.1%. 

Program name: JSOW - Unitary Variant; 
Current total acquisition cost: $3,386; 
First full estimate total acquisition cost: $5,354; 
Change in total acquisition cost from first full estimate: -36.8%; 
Change in total acquisition cost within the past year: -0.9%; 
Change in total acquisition cost within the past 5 years: 19.6%. 

Program name: Joint Tactical Networks (JTN); 
Current total acquisition cost: $2,261; 
First full estimate total acquisition cost: $1,032; 
Change in total acquisition cost from first full estimate: 119.1%; 
Change in total acquisition cost within the past year: 3.9%; 
Change in total acquisition cost within the past 5 years: 2.2%. 

Program name: Joint Tactical Radio System Handheld, Manpack, and Small 
Form Fit Radios (JTRS HMS); 
Current total acquisition cost: $8,936; 
First full estimate total acquisition cost: $10,557; 
Change in total acquisition cost from first full estimate: -15.4%; 
Change in total acquisition cost within the past year: 2.1%; 
Change in total acquisition cost within the past 5 years: 171.5%. 

Program name: KC-130J Transport Aircraft (KC-130J); 
Current total acquisition cost: $9,849; 
First full estimate total acquisition cost: $9,975; 
Change in total acquisition cost from first full estimate: -1.3%; 
Change in total acquisition cost within the past year: -2.2%; 
Change in total acquisition cost within the past 5 years: -1.3%. 

Program name: KC-46 Tanker Modernization Program (KC-46 Tanker); 
Current total acquisition cost: $44,519; 
First full estimate total acquisition cost: $46,090; 
Change in total acquisition cost from first full estimate: -3.4%; 
Change in total acquisition cost within the past year: -2.7%; 
Change in total acquisition cost within the past 5 years: -3.4%. 

Program name: LHA 6 America Class Amphibious Assault Ship; 
Current total acquisition cost: $10,110; 
First full estimate total acquisition cost: $3,345; 
Change in total acquisition cost from first full estimate: 202.3%; 
Change in total acquisition cost within the past year: -2.7%; 
Change in total acquisition cost within the past 5 years: 182.5%. 

Program name: Light Utility Helicopter (LUH), UH-72A Lakota; 
Current total acquisition cost: $1,891; 
First full estimate total acquisition cost: $1,904; 
Change in total acquisition cost from first full estimate: -0.7%; 
Change in total acquisition cost within the past year: -9.3%; 
Change in total acquisition cost within the past 5 years: -10.6%. 

Program name: Littoral Combat Ship (LCS)--Seaframes; 
Current total acquisition cost: $30,027; 
First full estimate total acquisition cost: $2,360; 
Change in total acquisition cost from first full estimate: NA; 
Change in total acquisition cost within the past year: -9.4%; 
Change in total acquisition cost within the past 5 years: NA. 

Program name: LPD 17 San Antonio Class Amphibious Transport Dock (LPD 
17); 
Current total acquisition cost: $19,424; 
First full estimate total acquisition cost: $12,318; 
Change in total acquisition cost from first full estimate: 57.7%; 
Change in total acquisition cost within the past year: -0.3%; 
Change in total acquisition cost within the past 5 years: 23.6%. 

Program name: MH-60R Multi-Mission Helicopter (MH-60R); 
Current total acquisition cost: $14,358; 
First full estimate total acquisition cost: $5,822; 
Change in total acquisition cost from first full estimate: 146.6%; 
Change in total acquisition cost within the past year: -5.6%; 
Change in total acquisition cost within the past 5 years: 9.5%. 

Program name: MH-60S Fleet Combat Support Helicopter (MH-60S); 
Current total acquisition cost: $8,727; 
First full estimate total acquisition cost: $3,690; 
Change in total acquisition cost from first full estimate: 136.5%; 
Change in total acquisition cost within the past year: -1.2%; 
Change in total acquisition cost within the past 5 years: 0.7%. 

Program name: Mobile User Objective System (MUOS); 
Current total acquisition cost: $7,448; 
First full estimate total acquisition cost: $7,069; 
Change in total acquisition cost from first full estimate: 5.4%; 
Change in total acquisition cost within the past year: 0.7%; 
Change in total acquisition cost within the past 5 years: 6.7%. 

Program name: MQ-1C Gray Eagle Unmanned Aircraft System (MQ-1C Gray 
Eagle); 
Current total acquisition cost: $4,951; 
First full estimate total acquisition cost: $1,068; 
Change in total acquisition cost from first full estimate: 363.6%; 
Change in total acquisition cost within the past year: 2.1%; 
Change in total acquisition cost within the past 5 years: 94.3%. 

Program name: MQ-4C Triton Unmanned Aircraft System (MQ-4C Triton); 
Current total acquisition cost: $13,544; 
First full estimate total acquisition cost: $13,512; 
Change in total acquisition cost from first full estimate: 0.2%; 
Change in total acquisition cost within the past year: 0.1%; 
Change in total acquisition cost within the past 5 years: 0.2%. 

Program name: MQ-8 Fire Scout; 
Current total acquisition cost: $2,811; 
First full estimate total acquisition cost: $2,751; 
Change in total acquisition cost from first full estimate: 2.2%; 
Change in total acquisition cost within the past year: 3.1%; 
Change in total acquisition cost within the past 5 years: 29.0%. 

Program name: MQ-9 Reaper Unmanned Aircraft System (MQ-9 Reaper); 
Current total acquisition cost: $12,706; 
First full estimate total acquisition cost: $2,774; 
Change in total acquisition cost from first full estimate: 358.1%; 
Change in total acquisition cost within the past year: -0.4%; 
Change in total acquisition cost within the past 5 years: 358.1%. 

Program name: Multifunctional Information Distribution System (MIDS); 
Current total acquisition cost: $3,809; 
First full estimate total acquisition cost: $1,371; 
Change in total acquisition cost from first full estimate: 177.7%; 
Change in total acquisition cost within the past year: 8.2%; 
Change in total acquisition cost within the past 5 years: 32.4%. 

Program name: National Airspace System (NAS); 
Current total acquisition cost: $1,671; 
First full estimate total acquisition cost: $913; 
Change in total acquisition cost from first full estimate: 82.9%; 
Change in total acquisition cost within the past year: -1.7%; 
Change in total acquisition cost within the past 5 years: -2.1%. 

Program name: Navstar Global Positioning System (Navstar GPS); 
Current total acquisition cost: $9,695; 
First full estimate total acquisition cost: $7,578; 
Change in total acquisition cost from first full estimate: 27.9%; 
Change in total acquisition cost within the past year: 0.0%; 
Change in total acquisition cost within the past 5 years: -4.1%. 

Program name: Navstar GPS Space & Control; 
Current total acquisition cost: $8,081; 
First full estimate total acquisition cost: $6,538; 
Change in total acquisition cost from first full estimate: 23.6%; 
Change in total acquisition cost within the past year: -0.1%; 
Change in total acquisition cost within the past 5 years: 4.0%. 

Program name: Navstar GPS User Equipment; 
Current total acquisition cost: $1,614; 
First full estimate total acquisition cost: $1,040; 
Change in total acquisition cost from first full estimate: 55.2%; 
Change in total acquisition cost within the past year: 0.8%; 
Change in total acquisition cost within the past 5 years: -30.9%. 

Program name: Navy Multiband Terminal Satellite (NMT); 
Current total acquisition cost: $1,937; 
First full estimate total acquisition cost: $2,441; 
Change in total acquisition cost from first full estimate: -20.7%; 
Change in total acquisition cost within the past year: -0.5%; 
Change in total acquisition cost within the past 5 years: -9.0%. 

Program name: Next Generation Operational Control System (GPS OCX); 
Current total acquisition cost: $3,470; 
First full estimate total acquisition cost: $3,482; 
Change in total acquisition cost from first full estimate: -0.3%; 
Change in total acquisition cost within the past year: -0.3%; 
Change in total acquisition cost within the past 5 years: -0.3%. 

Program name: P-8A Poseidon (P-8A); 
Current total acquisition cost: $34,336; 
First full estimate total acquisition cost: $32,640; 
Change in total acquisition cost from first full estimate: 5.2%; 
Change in total acquisition cost within the past year: -0.1%; 
Change in total acquisition cost within the past 5 years: 6.4%. 

Program name: Paladin Integrated Management (PIM); 
Current total acquisition cost: $6,930; 
First full estimate total acquisition cost: $7,033; 
Change in total acquisition cost from first full estimate: -1.5%; 
Change in total acquisition cost within the past year: -1.3%; 
Change in total acquisition cost within the past 5 years: -1.5%. 

Program name: Patriot Advanced Capability-3 (PAC-3); 
Current total acquisition cost: $13,157; 
First full estimate total acquisition cost: $5,482; 
Change in total acquisition cost from first full estimate: 140.0%; 
Change in total acquisition cost within the past year: 1.6%; 
Change in total acquisition cost within the past 5 years: 23.6%. 

Program name: Patriot/Medium Extended Air Defense System Combined 
Aggregate Program (Patriot/MEADS CAP); 
Current total acquisition cost: $11,745; 
First full estimate total acquisition cost: $28,029; 
Change in total acquisition cost from first full estimate: -58.1%; 
Change in total acquisition cost within the past year: -1.0%; 
Change in total acquisition cost within the past 5 years: -56.3%. 

Program name: Patriot/MEADS CAP Fire Unit; 
Current total acquisition cost: $3,383; 
First full estimate total acquisition cost: $20,365; 
Change in total acquisition cost from first full estimate: -83.4%; 
Change in total acquisition cost within the past year: -0.5%; 
Change in total acquisition cost within the past 5 years: -82.6%. 

Program name: Patriot/MEADS CAP Missile; 
Current total acquisition cost: $8,363; 
First full estimate total acquisition cost: $7,664; 
Change in total acquisition cost from first full estimate: 9.1%; 
Change in total acquisition cost within the past year: -1.2%; 
Change in total acquisition cost within the past 5 years: 12.6%. 

Program name: Remote Minehunting System (RMS); 
Current total acquisition cost: $1,463; 
First full estimate total acquisition cost: $1,516; 
Change in total acquisition cost from first full estimate: -3.5%; 
Change in total acquisition cost within the past year: -0.5%; 
Change in total acquisition cost within the past 5 years: -8.8%. 

Program name: RQ-4A/B Global Hawk Unmanned Aircraft System (RQ-4A/B 
Global Hawk); 
Current total acquisition cost: $9,874; 
First full estimate total acquisition cost: $5,671; 
Change in total acquisition cost from first full estimate: 74.1%; 
Change in total acquisition cost within the past year: -3.6%; 
Change in total acquisition cost within the past 5 years: -6.5%. 

Program name: Ship to Shore Connector (SSC); 
Current total acquisition cost: $4,053; 
First full estimate total acquisition cost: $4,158; 
Change in total acquisition cost from first full estimate: -2.5%; 
Change in total acquisition cost within the past year: -2.5%; 
Change in total acquisition cost within the past 5 years: -2.5%. 

Program name: Small Diameter Bomb Increment II (SDB II); 
Current total acquisition cost: $3,839; 
First full estimate total acquisition cost: $4,945; 
Change in total acquisition cost from first full estimate: 
Change in total acquisition cost within the past year: -22.4%; 
Change in total acquisition cost within the past year: -2.8%; 
Change in total acquisition cost within the past 5 years: -22.4%. 

Program name: Space Based Infrared System High Component (SBIRS High); 
Current total acquisition cost: $19,082; 
First full estimate total acquisition cost: $4,835; 
Change in total acquisition cost from first full estimate: 294.7%; 
Change in total acquisition cost within the past year: -1.0%; 
Change in total acquisition cost within the past 5 years: 43.3%. 

Program name: SSN 774 Virginia Class Submarine (SSN 774); 
Current total acquisition cost: $84,350; 
First full estimate total acquisition cost: $63,582; 
Change in total acquisition cost from first full estimate: 32.7%; 
Change in total acquisition cost within the past year: -2.6%; 
Change in total acquisition cost within the past 5 years: -5.0%. 

Program name: Standard Missile-6 (SM-6); 
Current total acquisition cost: $8,943; 
First full estimate total acquisition cost: $5,995; 
Change in total acquisition cost from first full estimate: 49.2%; 
Change in total acquisition cost within the past year: 41.9%; 
Change in total acquisition cost within the past 5 years: 54.7%. 

Program name: Tactical Tomahawk RGM-109E/UGM 109E Missile (Tactical 
Tomahawk); 
Current total acquisition cost: $7,451; 
First full estimate total acquisition cost: $2,226; 
Change in total acquisition cost from first full estimate: 234.8%; 
Change in total acquisition cost within the past year: -1.5%; 
Change in total acquisition cost within the past 5 years: 52.1%. 

Program name: Trident II (D-5) Sea-Launched Ballistic Missile UGM 133A 
(Trident II Missile); 
Current total acquisition cost: $56,419; 
First full estimate total acquisition cost: $54,405; 
Change in total acquisition cost from first full estimate: 3.7%; 
Change in total acquisition cost within the past year: 1.1%; 
Change in total acquisition cost within the past 5 years: 4.4%. 

Program name: UH-60M Black Hawk Helicopter (UH-60M Black Hawk); 
Current total acquisition cost: $24,368; 
First full estimate total acquisition cost: $13,641; 
Change in total acquisition cost from first full estimate: 78.6%; 
Change in total acquisition cost within the past year: -11.1%; 
Change in total acquisition cost within the past 5 years: 7.4%. 

Program name: V-22 Osprey Joint Services Advanced Vertical Lift 
Aircraft (V-22); 
Current total acquisition cost: $60,668; 
First full estimate total acquisition cost: $42,173; 
Change in total acquisition cost from first full estimate: 43.9%; 
Change in total acquisition cost within the past year: 1.3%; 
Change in total acquisition cost within the past 5 years: 0.3%. 

Program name: Warfighter Information Network-Tactical Increment 2 (WIN-
T Inc 2); 
Current total acquisition cost: $5,046; 
First full estimate total acquisition cost: $3,900; 
Change in total acquisition cost from first full estimate: 29.4%; 
Change in total acquisition cost within the past year: -20.9%; 
Change in total acquisition cost within the past 5 years: 29.4%. 

Program name: Warfighter Information Network-Tactical Increment 3 (WIN-
T Inc 3); 
Current total acquisition cost: $15,414; 
First full estimate total acquisition cost: $17,214; 
Change in total acquisition cost from first full estimate: -10.5%; 
Change in total acquisition cost within the past year: 17.7%; 
Change in total acquisition cost within the past 5 years: -10.5%. 

Program name: Wideband Global SATCOM (WGS); 
Current total acquisition cost: $4,154; 
First full estimate total acquisition cost: $1,255; 
Change in total acquisition cost from first full estimate: 230.8%; 
Change in total acquisition cost within the past year: -1.3%; 
Change in total acquisition cost within the past 5 years: 84.0%. 

Source: GAO analysis of DOD data. 

Notes: Data were obtained from DOD's Selected Acquisition Reports, 
acquisition program baselines, and, in some cases, program offices. 
Changes in total acquisition cost for the Littoral Combat Ship--
Seaframes over the past 5 years and from its first full estimate are 
shown as "NA" because DOD reported an incomplete baseline and cost 
data for the program through 2010. 

[End of table] 

[End of section] 

Appendix III: Changes in DOD's 2013 Portfolio of Major Defense 
Acquisition Programs over 5 Years and Since First Full Estimates: 

Table 9 shows the change in research and development cost, procurement 
cost, total acquisition cost, and average delay in delivering initial 
operational capability for those programs in Department of Defense's 
(DOD) 2013 portfolio over the last 5 years and since their first full 
cost and schedule estimates. 

Table 9: Cost and Schedule Changes for Programs in DOD's 2013 
Portfolio. 

Fiscal year 2014 dollars: 

Change in total research and development cost; 
5 year comparison (2008 to 2013): $32 billion; 12%; 
Since first full estimate (Baseline to 2013): $98 billion; 51%. 

Change in total procurement cost; 
5 year comparison (2008 to 2013): $170 billion; 16%; 
Since first full estimate (Baseline to 2013): $348 billion; 40%. 

Change in total other acquisition costs[A]; 
5 year comparison (2008 to 2013): $4 billion; 50%; 
Since first full estimate (Baseline to 2013): $2 billion; 18%. 

Change in total acquisition cost; 
5 year comparison (2008 to 2013): $207 billion; 16%; 
Since first full estimate (Baseline to 2013): $448 billion; 42%. 

Average delay in delivering initial capabilities; 
5 year comparison (2008 to 2013): 12 months; 14%; 
Since first full estimate (Baseline to 2013): 28 months; 36%. 

Source: GAO analysis of DOD data. 

Notes: Data were obtained from DOD's SARs and acquisition program 
baselines. In a few cases data were obtained directly from program 
offices. Some numbers may not sum due to rounding. 

[A] In addition to research and development and procurement costs, 
total acquisition cost includes acquisition-related operation and 
maintenance and system-specific military construction costs. 

[End of table] 

[End of section] 

Appendix IV: Knowledge-Based Acquisition Practices: 

GAO's prior work on best product-development practices found that 
successful programs take steps to gather knowledge that confirms that 
their technologies are mature, their designs stable, and their 
production processes are in control. Successful product developers 
ensure a high level of knowledge is achieved at key junctures in 
development. We characterize these junctures as knowledge points. The 
Related GAO Products section of this report includes references to the 
body of work that helped us identify these practices and apply them as 
criteria in weapon system reviews. The following table summarizes 
these knowledge points and associated key practices. 

Table 10: Best Practices for Knowledge-based Acquisitions: 

Knowledge Point 1: Technologies, time, funding, and other resources 
match customer needs. Decision to invest in product development: 

Demonstrate technologies to a high readiness level--Technology 
Readiness Level 7--to ensure technologies will work in an operational 
environment[A]. 

Ensure that requirements for product increment are informed by 
preliminary design review using systems engineering process (such as 
prototyping of preliminary design). 

Establish cost and schedule estimates for product on the basis of 
knowledge from preliminary design using systems engineering tools 
(such as prototyping of preliminary design). 

Constrain development phase (5 to 6 years or less) for incremental 
development. 

Ensure development phase fully funded (programmed in anticipation of 
milestone). 

Align program manager tenure to complete development phase. 

Contract strategy that separates system integration and system 
demonstration activities. 

Conduct independent cost estimate. 

Conduct independent program assessment. 

Conduct major milestone decision review for development start. 

Knowledge Point 2: Design is stable and performs as expected. Decision 
to start building and testing production-representative prototypes: 

Complete system critical design review. 

Complete 90 percent of engineering design drawing packages. 

Complete subsystem and system design reviews. 

Demonstrate with system-level integrated prototype that design meets 
requirements. 

Complete the failure modes and effects analysis. 

Identify key system characteristics. 

Identify critical manufacturing processes. 

Establish reliability targets and growth plan on the basis of 
demonstrated reliability rates of components and subsystems. 

Conduct independent cost estimate. 

Conduct independent program assessment. 

Conduct major milestone decision review to enter system demonstration. 

Knowledge Point 3: Production meets cost, schedule, and quality 
targets. Decision to produce first units for customer: 

Demonstrate manufacturing processes. 

Build and test production-representative prototypes to demonstrate 
product in intended environment. 

Test production-representative prototypes to achieve reliability goal. 

Collect statistical process control data. 

Demonstrate that critical processes are capable and in statistical 
control. 

Conduct independent cost estimate. 

Conduct independent program assessment. 

Conduct major milestone decision review to begin production. 

Source: GAO. 

Note: DOD considers Technology Readiness Level 6, demonstrations in a 
relevant environment, to be appropriate for programs entering system 
development; therefore we have analyzed programs against this measure 
as well. 

[End of table] 

[End of section] 

Appendix V: Technology Readiness Levels: 

Technology readiness level: 1. 
Basic principles observed and reported; 
Description: Lowest level of technology readiness. Scientific research 
begins to be translated into applied research and development. 
Examples might include paper studies of a technology's basic 
properties; 
Hardware/software: None (paper studies and analysis); 
Demonstration environment: None. 

Technology readiness level: 2. 
Technology concept and/or application formulated; 
Description: Invention begins. Once basic principles are observed, 
practical applications can be invented. The application is speculative 
and there is no proof or detailed analysis to support the assumption. 
Examples are still limited to paper studies; 
Hardware/software: None (paper studies and analysis); 
Demonstration environment: None. 

Technology readiness level: 3. 
Analytical and experimental critical function and/or characteristic 
proof of concept; 
Description: Active research and development is initiated. This 
includes analytical studies and laboratory studies to physically 
validate analytical predictions of separate elements of the 
technology. Examples include components that are not yet integrated or 
representative; 
Hardware/software: Analytical studies and demonstration of nonscale 
individual components (pieces of subsystem); 
Demonstration environment: Lab. 

Technology readiness level: 4. 
Component and/or breadboard validation in laboratory environment; 
Description: Basic technological components are integrated to 
establish that the pieces will work together. This is relatively "low 
fidelity" compared to the eventual system. Examples include 
integration of "ad hoc" hardware in a laboratory; 
Hardware/software: Low-fidelity breadboard. Integration of nonscale 
components to show pieces will work together. Not fully functional or 
form or fit but representative of technically feasible approach 
suitable for flight articles. 
Demonstration environment: Lab. 

Technology readiness level: 5. 
Component and/or breadboard validation in relevant environment; 
Description: Fidelity of breadboard technology increases 
significantly. The basic technological components are integrated with 
reasonably realistic supporting elements so that the technology can be 
tested in a simulated environment. Examples include "high fidelity" 
laboratory integration of components; 
Hardware/software: High-fidelity breadboard. Functionally equivalent 
but not necessarily form and/or fit (size weight, materials, etc). 
Should be approaching appropriate scale. May include integration of 
several components with reasonably realistic support 
elements/subsystems to demonstrate functionality; 
Demonstration environment: Lab demonstrating functionality but not 
form and fit. May include flight demonstrating breadboard in surrogate 
aircraft. Technology ready for detailed design studies. 

Technology readiness level: 6. 
System/subsystem model or prototype demonstration in a relevant 
environment; 
Description: Representative model or prototype system, which is well 
beyond the breadboard tested for TRL 5, is tested in a relevant 
environment. Represents a major step up in a technology's demonstrated 
readiness. Examples include testing a prototype in a high fidelity 
laboratory environment or in simulated realistic environment; 
Hardware/software: Prototype. Should be very close to form, fit and 
function. Probably includes the integration of many new components and 
realistic supporting elements/subsystems if needed to demonstrate full 
functionality of the subsystem; 
Demonstration environment: High-fidelity lab demonstration or 
limited/restricted flight demonstration for a relevant environment. 
Integration of technology is well defined. 

Technology readiness level: 7. 
System prototype demonstration in a realistic environment; 
Description: Prototype near or at planned operational system. 
Represents a major step up from TRL 6, requiring the demonstration of 
an actual system prototype in a realistic environment, such as in an 
aircraft, vehicle or space. Examples include testing the prototype in 
a test bed aircraft; 
Hardware/software: Prototype. Should be form, fit and function 
integrated with other key supporting elements/subsystems to 
demonstrate full functionality of subsystem; 
Demonstration environment: Flight demonstration in representative 
realistic environment such as flying test bed or demonstrator 
aircraft. Technology is well substantiated with test data. 

Technology readiness level: 8. 
Actual system completed and "flight qualified" through test and 
demonstration; 
Description: Technology has been proven to work in its final form and 
under expected conditions. In almost all cases, this TRL represents 
the end of true system development. Examples include developmental 
test and evaluation of the system in its intended weapon system to 
determine if it meets design specifications; 
Hardware/software: Flight-qualified hardware; 
Demonstration environment: Developmental Test and Evaluation (DT&E) in 
the actual system application. 

Technology readiness level: 9. 
Actual system "flight proven" through successful mission operations; 
Description: Actual application of the technology in its final form 
and under mission conditions, such as those encountered in operational 
test and evaluation. In almost all cases, this is the end of the last 
"bug fixing" aspects of true system development. Examples include 
using the system under operational mission conditions; 
Hardware/software: Actual system in final form; 
Demonstration environment: Operational Test and Evaluation (OT&E) in 
operational mission conditions. 

Source: GAO and its analysis of National Aeronautics and Space 
Administration data. 

[End of table] 

[End of section] 

Appendix VI: Major Defense Acquisition Programs' Individual 
Subcontracting Reports in the Electronic Subcontracting Reporting 
System: 

Table 11 contains the numbers of individual subcontracting reports 
from the prime contractor for the programs we assessed that were 
accepted on the Electronic Subcontracting Reporting System (eSRS). We 
reviewed this information for the 36 major defense acquisition 
programs included in our individual program assessments using the 
prime contracts reported in available Selected Acquisition Reports. 
The government uses individual subcontracting reports on eSRS as one 
method of monitoring small business participation, as the report 
includes goals for small business subcontracting. There are multiple 
reasons why a program may not have an accepted subcontracting report 
in eSRS. For example, some programs may have pending or rejected 
reports within the system as all reports are reviewed prior to 
acceptance. Not all prime contracts for major defense acquisition 
programs are required to submit individual subcontracting reports. 
Instead, some contractors report small business participation at a 
corporate level as opposed to the program level and this data is not 
captured in the individual subcontracting reports.[Footnote 38] 
Specifically, the F-35 program provided questionnaire data indicating 
that for the five contracts listed in the December 2012 SAR all report 
at the comprehensive, contractor level. Similarly for the three 
contracts listed by JLTV program officials, questionnaire data shows 
that one of them reports on small business participation at the 
corporate level with no participation information specific to the JLTV 
program. Finally, although a program may be required to submit a 
report it may not yet have done so for the period we reviewed. 

Table 10: Major Defense Acquisition Programs' Individual 
Subcontracting Reports in the Electronic Subcontracting Reporting 
System: 

Program name: AIM-9X Block II Air-to-Air Missile (AIM-9X Block II); 
Number of contracts listed in the December 2012 SAR: 2; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Airborne and Maritime/Fixed Station Joint Tactical Radio 
System (AMF JTRS); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: CH-53K Heavy Lift Replacement Helicopter (CH-53K); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Gerald R. Ford Class Nuclear Aircraft Carrier (CVN 78); 
Number of contracts listed in the December 2012 SAR: 6; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 3. 

Program name: DDG 1000 Zumwalt Class Destroyer (DDG 1000); 
Number of contracts listed in the December 2012 SAR: 4; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 3. 

Program name: DDG 51 Arleigh Burke Class Guided Missile Destroyer (DDG 
51); 
Number of contracts listed in the December 2012 SAR: 4; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 3. 

Program name: Evolved Expendable Launch Vehicle (EELV); 
Number of contracts listed in the December 2012 SAR: 10; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 4. 

Program name: Excalibur Precision 155mm Projectiles (Excalibur); 
Number of contracts listed in the December 2012 SAR: 2; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: F-22 Increment 3.2B; 
Number of contracts listed in the December 2012 SAR: 2; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: F-35 Lightning II (F-35); 
Number of contracts listed in the December 2012 SAR: 6; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Family of Advanced Beyond Line-of-Sight Terminals (FAB-
T); 
Number of contracts listed in the December 2012 SAR: 2; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Global Positioning System III (GPS III); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Ground/Air Task Oriented Radar (G/ATOR); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Integrated Air and Missile Defense (IAMD); 
Number of contracts listed in the December 2012 SAR: 3; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 1. 

Program name: Joint Air-to-Surface Standoff Missile-Extended Range 
(JASSM-ER); 
Number of contracts listed in the December 2012 SAR: 3; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Joint Land Attack Cruise Missile Defense Elevated Netted 
Sensor System (JLENS); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Joint Light Tactical Vehicle (JLTV); 
Number of contracts listed in the December 2012 SAR: 3; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 2. 

Program name: Joint Precision Approach and Landing System Increment 1A 
(JPALS Inc 1A); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Joint Tactical Radio System Handheld, Manpack, and Small 
Form Fit Radios (JTRS HMS); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: KC-46 Tanker Modernization Program (KC-46 Tanker); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 1. 

Program name: LHA 6 America Class Amphibious Assault Ship (LHA 6); 
Number of contracts listed in the December 2012 SAR: 2; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 2. 

Program name: Littoral Combat Ship (LCS)--Seaframes; 
Number of contracts listed in the December 2012 SAR: 3; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 2. 

Program name: MQ-1C Gray Eagle Unmanned Aircraft System (MQ-1C Gray 
Eagle); 
Number of contracts listed in the December 2012 SAR: 6; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 5. 

Program name: MQ-4C Triton Unmanned Aircraft System (MQ-4C Triton); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: (Continued From Previous Page); 
Number of contracts listed in the December 2012 SAR: [Empty]; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): [Empty]. 

Program name: MQ-8 Fire Scout; 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 1. 

Program name: MQ-9 Reaper Unmanned Aircraft System (MQ-9 Reaper); 
Number of contracts listed in the December 2012 SAR: 2; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Mobile User Objective System (MUOS); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Next Generation Operational Control System (GPS OCX); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: P-8A Poseidon (P-8A); 
Number of contracts listed in the December 2012 SAR: 2; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 1. 

Program name: Paladin Integrated Management (PIM); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 1. 

Program name: RQ-4A/B Global Hawk Unmanned Aircraft System (RQ-4A/B 
Global Hawk); 
Number of contracts listed in the December 2012 SAR: 5; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 2. 

Program name: Ship to Shore Connector (SSC); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 1. 

Program name: Small Diameter Bomb Increment II (SDB II); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Space Based Infrared System High Component (SBIRS High); 
Number of contracts listed in the December 2012 SAR: 3; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Warfighter Information Network-Tactical Increment 2 (WIN-
T Inc 2); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Warfighter Information Network-Tactical Increment 3 (WIN-
T Inc 3); 
Number of contracts listed in the December 2012 SAR: 1; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 0. 

Program name: Total; 
Number of contracts listed in the December 2012 SAR: 87; 
Contracts with an accepted individual subcontracting report (as of 
January 2014): 32. 

Source: GAO analysis of data from DOD and eSRS. 

[End of table] 

[End of section] 

Appendix VII: Comments from the Department of Defense: 

Office of The Under Secretary of Defense: 
Acquisition, Technology and Logistics: 
3000 Defense Pentagon: 
Washington, Dc 20301-3000: 

March 21, 2014: 

Mr. Michael J. Sullivan: 
Director, Acquisition and Sourcing Management: 
U.S. Government Accountability Office: 
441 G St., NW: 
Washington, DC 20548: 

Dear Mr. Sullivan, 

This is the Department of Defense response to the GAO Draft Report, 
GAO-14-340SP, "Defense Acquisitions: Assessments of Selected Weapon 
Programs" dated March 2014 (GAO Code 121144). 

The Department is pleased that this year's Draft Report, the l2th 
annual assessment on the performance of DoD's major acquisition 
programs, is the most encouraging to date. GAO results indicate that 
the Department's commitment to acquisition excellence in the Better 
Buying Power initiatives continue to have a positive impact on cost, 
schedule, and performance measures of our programs. 

The Under Secretary of Defense for Acquisition, Technology, and 
Logistics will again publish a comprehensive report on the acquisition 
system in 2014. The 2nd annual report will be a data driven analysis 
that provides transparent and objective performance measures of our 
major acquisition programs and contracts. The fiscal environment
remains challenging and continues to put downward pressure on 
investment funding. Continued improvement of the acquisition system 
will require a more clear understanding of how decisions throughout 
the process influence performance. 

The Department appreciates the opportunity to comment on the Draft 
Report. My point of contact for this effort is Mr. Joe Beauregard, 703-
697-8046. 

Sincerely, 

Signed by: 

Nancy L. Spruill: 
Director: 
Acquisition Resources & Analysis: 

[End of section] 

Appendix VIII: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Michael J. Sullivan, (202) 512-4841 or sullivanm@gao.gov: 

Staff Acknowledgments: 

Principal contributors to this report were J. Kristopher Keener, 
Assistant Director; Matthew T. Drerup; Jonathan Mulcare; Danny Owens; 
Charlie Shivers; and Wendy Smythe. Other key contributors included 
Peter W. Anderson, Cheryl Andrew, David B. Best, Laurier R. Fish, 
Arthur Gallegos, William R. Graveline, Kristine R. Hassinger, Julia 
Kennon, Jill N. Lacey, Travis J. Masters, Jean L. McSween, Sean 
Merrill, LaTonya Miller, Diana L. Moldafsky, John Oppenheim, Kenneth 
E. Patton, Ronald E. Schwenn, and Roxanna T. Sun, Bruce H. Thomas, and 
Alyssa Weir. 

The following were responsible for individual programs: 

Current Programs: 

Program name: AIM-9X Block II Air-to-Air Missile (AIM-9X Block II); 
Primary staff: Jennifer A. Dougherty, Christopher D. Zbrozek. 

Program name: Air and Missile Defense Radar (AMDR); 
Primary staff: George A. Bustamante, C. James Madar, Ioan T. Ifrim. 

Program name: Airborne and Maritime/Fixed Station Joint Tactical Radio 
System (AMF JTRS); 
Primary staff: Aryn C. Ehlow, Nathan A. Tranquilli, Paul G. Williams. 

Program name: CH-53K Heavy Lift Replacement (CH-53K); 
Primary staff: Robert K. Miller, Marvin E. Bonner. 

Program name: Gerald R. Ford Class Nuclear Aircraft Carrier (CVN 78); 
Primary staff: Burns C. Eckert, Jenny Shinn. 

Program name: DDG 1000 Zumwalt Class Destroyer (DDG 1000); 
Primary staff: Patrick M. Breiding, Angie Nichols-Friedman. 

Program name: DDG 51 Arleigh Burke Class Guided Missile Destroyer (DDG 
51); 
Primary staff: Greg Campbell, Ioan T. Ifrim. 

Program name: Evolved Expendable Launch Vehicle (EELV); 
Primary staff: Desirée E. Cunningham, Maria A. Durant. 

Program name: Excalibur Precision 155mm Projectiles (Excalibur); 
Primary staff: Ryan Stott, Carrie W. Rogers. 

Program name: F-22 Increment 3.2B; 
Primary staff: Robert P. Bullock, Christopher D. Zbrozek, Sean C. 
Seales. 

Program name: F-35 Lightning II (F-35); 
Primary staff: Abby C. Volk, Marvin E. Bonner. 

Program name: Family of Advanced Beyond Line-of-Sight Terminals (FAB-
T); 
Primary staff: Scott M. Purdy, Alexandra Dew Silva. 

Program name: Global Positioning System III (GPS III); 
Primary staff: Laura T. Holliday, Erin R. Cohen. 

Program name: Ground/Air Task Oriented Radar (G/ATOR); 
Primary staff: Bonita J. P. Oden, Jonathan Mulcare. 

Program name: Integrated Air and Missile Defense (IAMD); 
Primary staff: John M. Ortiz, Carol T. Mebane. 

Program name: Joint Air-to-Surface Standoff Missile Extended Range 
(JASSM-ER); 
Primary staff: Brian A. Tittle, John W. Crawford. 

Program name: Joint Land Attack Cruise Missile Defense Elevated Netted 
Sensor System (JLENS); 
Primary staff: Maria A. Durant, John M. Ortiz. 

Program name: Joint Light Tactical Vehicle (JLTV); 
Primary staff: Dayna L. Foster, Andrea M. Bivens. 

Program name: Joint Precision Approach and Landing System Increment 1A; 
(JPALS Inc 1A); 
Primary staff: Stephen V. Marchesani, Jared A. Sippel. 

Program name: Joint Tactical Radio System Handheld, Manpack, and Small 
Form Fit Radios (JTRS HMS); 
Primary staff: Nathan A. Tranquilli, Aryn C. Ehlow, Paul G. Williams. 

Program name: KC-46 Tanker Modernization Program (KC-46 Tanker); 
Primary staff: Jeffrey L. Hartnett, Katheryn S. Hubbell. 

Program name: LHA 6 America Class Amphibious Assault Ship (LHA 6); 
Primary staff: Christopher E. Kunitz, Jenny Chow. 

Program name: Littoral Combat Ship (LCS)--Mission Packages; 
Primary staff: Laurier R. Fish, Greg Campbell. 

Program name: Littoral Combat Ship (LCS)--Seaframes; 
Primary staff: Amber N. Keyser, Christopher R. Durbin. 

Program name: Mobile User Objective System (MUOS); 
Primary staff: Richard Y. Horiuchi, Desirée E. Cunningham. 

Program name: MQ-1C Unmanned Aircraft System (MQ-1C Gray Eagle); 
Primary staff: Deanna Laufer, James S. Kim. 

Program name: MQ-4C Triton Unmanned Aircraft System (MQ-4C Triton); 
Primary staff: Tom Twambly, Candice N. Wright, Amanda Parker. 

Program name: MQ-8 Fire Scout; 
Primary staff: Leigh Ann Haydon, Deanna Laufer. 

Program name: MQ-9 Unmanned Aircraft System Reaper (MQ-9 Reaper); 
Primary staff: Megan L. Porter, Laura Jezewski. 

Program name: Next Generation Operational Control System (GPS OCX); 
Primary staff: Erin R. Cohen, Jeffrey M. Sanders. 

Program name: P-8A Poseidon (P-8A); 
Primary staff: Jocelyn C. Yin, Heather B. Miller. 

Program name: Paladin Integrated Management (PIM); 
Primary staff: William C. Allbritton, Marcus C. Ferguson. 

Program name: RQ-4A/B Global Hawk Unmanned Aircraft System (RQ-4A/B 
Global Hawk); 
Primary staff: Laura M. Jezewski, Megan L. Porter. 

Program name: Ship to Shore Connector (SSC); 
Primary staff: Matthew Shaffer, Beth Reed Fritts. 

Program name: Small Diameter Bomb Increment II (SDB II); 
Primary staff: John W. Crawford, Brian A. Tittle. 

Program name: Space Based Infrared System High Component (SBIRS High); 
Primary staff: Claire A. Buck, Maricela Cherveny. 

Program name: Warfighter Information Network-Tactical Increment 2 (WIN-
T Inc 2); 
Primary staff: James P. Tallon, Andrea Yohe. 

Program name: Warfighter Information Network-Tactical Increment 3 (WIN-
T Inc 3); 
Primary staff: James P. Tallon, Andrea Yohe. 

Future Programs: 

Program name: Amphibious Combat Vehicle (ACV); 
Primary staff: MacKenzie H. Cooper, Bonita J. P. Oden. 

Program name: Armored Multi-Purpose Vehicle (AMPV); 
Primary staff: Andrea M. Bivens, Dayna L. Foster. 

Program name: B-2 Defensive Management System (DMS) Modernization; 
Primary staff: Don M. Springman, Matthew B. Lea. 

Program name: Combat Rescue Helicopter (CRH); 
Primary staff: J. Andrew Walker, Robert K. Miller. 

Program name: Common Infrared Countermeasures (CIRCM); 
Primary staff: Danny G. Owens, Wendy P. Smythe. 

Program name: Enhanced Polar System (EPS); 
Primary staff: Bradley L. Terry. 

Program name: F-15 Eagle Passive/Active Warning and Survivability 
System; (F-15 EPAWSS); 
Primary staff: Wendell K. Hudson, LeAnna M. Parkey. 

Program name: Ground Combat Vehicle (GCV); 
Primary staff: Marcus C. Ferguson, William C. Allbritton. 

Program name: Indirect Fire Protection Capability, Increment 2 (IFPC 
Inc 2); 
Primary staff: Helena Brink, Carol T. Mebane. 

Program name: Joint Air-to-Ground Missile (JAGM); 
Primary staff: Wendy P. Smythe, Ryan Stott. 

Program name: Military GPS User Equipment (MGUE), Increment 1; 
Primary staff: Raj C. Chitikila, Andrew H. Redd. 

Program name: Next Generation Jammer (NGJ); 
Primary staff: Teakoe S. Coleman, Laura T. Holliday. 

Program name: Ohio Class Replacement (OR); 
Primary staff: C. James Madar, Amber N. Keyser. 

Program name: Presidential Aircraft Recapitalization Program (PAR); 
Primary staff: LeAnna M. Parkey, Brian Smith. 

Program name: Presidential Helicopter (VXX); 
Primary staff: Bonita J. P. Oden, Jerry W. Clark. 

Program name: Space Fence; 
Primary staff: Laura D. Hook, Jeffrey M. Sanders. 

Program name: Three-Dimensional Expeditionary Long-Range Radar 
(3DELRR); 
Primary staff: Claire Li, Janet L. McKelvey. 

Program name: Unmanned Carrier-Launched Airborne Surveillance and 
Strike (UCLASS) System; 
Primary staff: Julie C. Hadley, Sean D. Merrill. 

[End of table] 

[End of section] 

Related GAO Products: 

Defense Acquisitions: Where Should Reform Aim Next? [hyperlink, 
http://www.gao.gov/products/GAO-14-145T]. Washington, D.C.: October 
29, 2013. 

Ford-Class Carriers: Lead Ship Testing and Reliability Shortfalls Will 
Limit Initial Fleet Capabilities. [hyperlink, 
http://www.gao.gov/products/GAO-13-396]. Washington, D.C.: September 
5, 2013. 

Navy Shipbuilding: Significant Investments in the Littoral Combat Ship 
Continue Amid Substantial Unknowns about Capabilities, Use, and Cost. 
[hyperlink, http://www.gao.gov/products/GAO-13-530]. Washington, D.C.: 
July 22, 2013. 

Missile Defense: Opportunity to Refocus on Strengthening Acquisition 
Management. [hyperlink, http://www.gao.gov/products/GAO-13-432]. 
Washington, D.C.: April 26, 2013. 

Defense Acquisitions: Assessments of Selected Weapon Programs. 
[hyperlink, http://www.gao.gov/products/GAO-13-294SP]. Washington, 
D.C.: March 28, 2013. 

High-Risk Series: An Update. [hyperlink, 
http://www.gao.gov/products/GAO-13-283]. Washington, D.C.: February 
2013. 

Weapons Acquisition Reform: Reform Act Is Helping DOD Acquisition 
Programs Reduce Risk, but Implementation Challenges Remain. 
[hyperlink, http://www.gao.gov/products/GAO-13-103]. Washington, D.C.: 
December 14, 2012. 

Joint Strike Fighter: DOD Actions Needed to Further Enhance 
Restructuring and Address Affordability Risks. [hyperlink, 
http://www.gao.gov/products/GAO-12-437]. Washington, D.C.: June 14, 
2012. 

Missile Defense: Opportunity Exists to Strengthen Acquisitions by 
Reducing Concurrency. [hyperlink, 
http://www.gao.gov/products/GAO-12-486]. Washington, D.C.: April 20, 
2012. 

Defense Acquisitions: Assessments of Selected Weapon Programs. 
[hyperlink, http://www.gao.gov/products/GAO-12-400SP]. Washington, 
D.C.: March 29, 2012. 

Arleigh Burke Destroyers: Additional Analysis and Oversight Required 
to Support the Navy's Future Surface Combatant Plans. [hyperlink, 
http://www.gao.gov/products/GAO-12-113], Washington, D.C.: January 24, 
2012. 

Weapons Acquisition Reform: Actions Needed to Address Systems 
Engineering and Developmental Testing Challenges. [hyperlink, 
http://www.gao.gov/products/GAO-11-806]. Washington, D.C.: September 
19, 2011. 

Defense Acquisitions: DOD Can Improve Its Management of Configuration 
Steering Boards. [hyperlink, http://www.gao.gov/products/GAO-11-640]. 
Washington, D.C.: July 7, 2011. 

Space and Missile Defense Acquisitions: Periodic Assessment Needed to 
Correct Parts Quality Problems in Major Programs. [hyperlink, 
http://www.gao.gov/products/GAO-11-404]. Washington, D.C.: June 24, 
2011. 

Defense Acquisitions: Assessments of Selected Weapon Programs. 
[hyperlink, http://www.gao.gov/products/GAO-11-233SP]. Washington, 
D.C.: March 29, 2011. 

Defense Acquisitions: Observations on Weapon Program Performance and 
Acquisition Reforms. [hyperlink, 
http://www.gao.gov/products/GAO-10-706T. Washington, D.C: May 19, 2010. 

Defense Acquisitions: Strong Leadership Is Key to Planning and 
Executing Stable Weapon Programs. [hyperlink, 
http://www.gao.gov/products/GAO-10-522]. Washington, D.C.: May 6, 2010. 

Best Practices: DOD Can Achieve Better Outcomes by Standardizing the 
Way Manufacturing Risks Are Managed. [hyperlink, 
http://www.gao.gov/products/GAO-10-439]. Washington, D.C: April 22, 
2010. 

Best Practices: High Levels of Knowledge at Key Points Differentiate 
Commercial Shipbuilding from Navy Shipbuilding. [hyperlink, 
http://www.gao.gov/products/GAO-09-322]. Washington, D.C.: May 13, 
2009. 

Defense Acquisitions: Charting a Course for Lasting Reform. 
[hyperlink, http://www.gao.gov/products/GAO-09-663T]. Washington, 
D.C.: April 30, 2009. 

Defense Acquisitions: Measuring the Value of DOD's Weapon Programs 
Requires Starting with Realistic Baselines. [hyperlink, 
http://www.gao.gov/products/GAO-09-543T]. Washington, D.C.: April 1, 
2009. 

Defense Acquisitions: DOD Must Balance Its Needs with Available 
Resources and Follow an Incremental Approach to Acquiring Weapon 
Systems. [hyperlink, http://www.gao.gov/products/GAO-09-431T]. 
Washington, D.C.: March 3, 2009. 

GAO Cost Estimating and Assessment Guide: Best Practices for 
Developing and Managing Capital Program Costs. [hyperlink, 
http://www.gao.gov/products/GAO-09-3SP]. Washington, D.C.: March 2, 
2009. 

Defense Acquisitions: Perspectives on Potential Changes to Department 
of Defense Acquisition Management Framework. [hyperlink, 
http://www.gao.gov/products/GAO-09-295R]. Washington, D.C.: February 
27, 2009. 

Defense Acquisitions: Cost to Deliver Zumwalt-Class Destroyers Likely 
to Exceed Budget. [hyperlink, http://www.gao.gov/products/GAO-08-804]. 
Washington, D.C.: July 31, 2008. 

Defense Acquisitions: A Knowledge-Based Funding Approach Could Improve 
Major Weapon System Program Outcomes. [hyperlink, 
http://www.gao.gov/products/GAO-08-619]. Washington, D.C.: July 2, 
2008. 

Best Practices: Increased Focus on Requirements and Oversight Needed 
to Improve DOD's Acquisition Environment and Weapon System Quality. 
[hyperlink, http://www.gao.gov/products/GAO-08-294]. Washington, D.C.: 
February 1, 2008. 

Best Practices: An Integrated Portfolio Management Approach to Weapon 
System Investments Could Improve DOD's Acquisition Outcomes. 
[hyperlink, http://www.gao.gov/products/GAO-07-388]. Washington, D.C.: 
March 30, 2007. 

Defense Acquisitions: Major Weapon Systems Continue to Experience Cost 
and Schedule Problems under DOD's Revised Policy. [hyperlink, 
http://www.gao.gov/products/GAO-06-368]. Washington, D.C.: April 14, 
2006. 

Defense Acquisitions: Improved Management Practices Could Help 
Minimize Cost Growth in Navy Shipbuilding Programs. [hyperlink, 
http://www.gao.gov/products/GAO-05-183]. Washington, D.C.: February 
28, 2005. 

Best Practices: Using a Knowledge-Based Approach to Improve Weapon 
Acquisition. [hyperlink, http://www.gao.gov/products/GAO-04-386SP]. 
Washington, D.C.: January 2004. 

Best Practices: Capturing Design and Manufacturing Knowledge Early 
Improves Acquisition Outcomes. [hyperlink, 
http://www.gao.gov/products/GAO-02-701]. Washington, D.C.: July 15, 
2002. 

Best Practices: Better Matching of Needs and Resources Will Lead to 
Better Weapon System Outcomes. [hyperlink, 
http://www.gao.gov/products/GAO-01-288]. Washington, D.C.: March 8, 
2001. 

Best Practices: Better Management of Technology Development Can 
Improve Weapon System Outcomes. [hyperlink, 
http://www.gao.gov/products/GAO/NSIAD-99-162]. Washington, D.C.: July 
30, 1999. 

[End of section] 

Footnotes: 

[1] GAO, High-Risk Series: An Update, [hyperlink, 
http://www.gao.gov/products/GAO-13-283] (Washington, D.C.: February 
2013). 

[2] Our assessment of DOD's 2012 portfolio of 86 major defense 
acquisition programs included the Missile Defense Agency's Ballistic 
Missile Defense System (BMDS). While DOD continues to report on BMDS 
as a major defense acquisition program, we exclude it from our 
assessment this year as the program lacks an acquisition program 
baseline comparable to the other programs, preventing us from 
measuring cost and schedule change in a manner consistent with our 
methodology. For more information on cost and schedule baselines for 
BMDS and the challenges for oversight they present see GAO, Missile 
Defense: Opportunity to Refocus on Strengthening Acquisition 
Management, [hyperlink, http://www.gao.gov/products/GAO-13-432] 
(Washington, D.C.: Apr. 26, 2013). 

[3] See Explanatory Statement, 154 Cong. Rec. H 9427, 9526 (daily ed., 
Sept. 24, 2008), to the Department of Defense Appropriations Act. 
2009, contained in Division C of the Consolidated Security, Disaster 
Assistance, and Continuing Appropriations Act, 2009, Pub. L. No. 110-
329 (2008). 

[4] Major defense acquisition programs (MDAP) are those identified by 
DOD with a dollar value for all increments estimated to require 
eventual total expenditure for research, development, test, and 
evaluation of more than $480 million, or for procurement of more than 
$2.79 billion, in fiscal year 2014 constant dollars. DOD has a list of 
programs designated as future major defense acquisition programs. 
These programs have not formally been designated as MDAPs; however, 
DOD plans for these programs to enter system development, or bypass 
development and begin production, at which point they will likely be 
designated as MDAPs. We refer to these programs as future major 
defense acquisition programs throughout this report. 

[5] The 12 programs that exited the portfolio were AIM-9X Block I, C-
130 Avionics Modernization Program, Chemical Demilitarization-Chemical 
Materials Agency, Cobra Judy Replacement, High Mobility Artillery 
Rocket System, Joint High Speed Vessel, Joint Tactical Radio System 
Ground Mobile Radio, Multi-Platform-Radar Technology Insertion 
Program, National Polar-orbiting Operational Environmental Satellite 
System, Stryker Family of Vehicles, Thermal Weapons Sight, Warfighter 
Information Network - Tactical Increment 1. The seven that entered the 
portfolio were Airborne Warning and Control System Block 40/45 
Upgrade, AN/TPS-80 Ground/Air Task Oriented Radar, B61 Mod 12 Life 
Extension Program Tailkit Assembly, Evolved Expendable Launch Vehicle, 
Joint Light Tactical Vehicle, Next Generation Operational Control 
System (GPS OCX), and Ship to Shore Connector. 

[6] Section 2433 of title 10 of the United States Code, commonly 
referred to as Nunn-McCurdy, requires DOD to notify Congress whenever 
a major defense acquisition program's unit cost experiences cost 
growth that exceeds certain thresholds. This is commonly referred to 
as a Nunn-McCurdy breach. Significant breaches occur when the program 
acquisition unit cost or procurement unit cost increases by at least 
15 percent over the current baseline estimate or at least 30 percent 
over the original estimate. For critical breaches, when these unit 
costs increase at least 25 percent over the current baseline estimate 
or at least 50 percent over the original, DOD is required to take 
additional steps, including conducting an in-depth review of the 
program. Programs with critical breaches must be terminated unless the 
Secretary of Defense certifies to certain facts related to the program 
and takes other actions, including restructuring the program. 10 
U.S.C. § 2433. 

[7] A description of this calculation can be found in the detailed 
scope and methodology in appendix I. 

[8] GAO, Navy Shipbuilding: Significant Investments in the Littoral 
Combat Ship Continue Amid Substantial Unknowns about Capabilities, 
[hyperlink, http://www.gao.gov/products/GAO-13-530] (Washington, D.C.: 
July 22, 2013); Ford-Class Carriers: Lead Ship Testing and Reliability 
Shortfalls Will Limit Initial Fleet Capabilities, [hyperlink, 
http://www.gao.gov/products/GAO-13-396] (Washington, D.C.: Sept. 5, 
2013); Arleigh Burke Destroyers: Additional Analysis and Oversight 
Required to Support the Navy's Future Surface Combatant Plans, 
[hyperlink, http://www.gao.gov/products/GAO-12-113] (Washington, D.C.: 
Jan. 24, 2012); Best Practices: High Levels of Knowledge at Key Points 
Differentiate Commercial Shipbuilding from Navy Shipbuilding, 
[hyperlink, http://www.gao.gov/products/GAO-09-322] (Washington, D.C.: 
May 13, 2009); and Defense Acquisitions: Cost to Deliver Zumwalt-Class 
Destroyers Likely to Exceed Budgets, [hyperlink, 
http://www.gao.gov/products/GAO-08-804] (Washington, D.C.: July. 31, 
2008). 

[9] GAO, Best Practices: Better Management of Technology Development 
Can Improve Weapon System Outcomes, [hyperlink, 
http://www.gao.gov/products/GAO/NSIAD-99-162] (Washington, D.C.: July 
30, 1999); Best Practices: Better Matching of Needs and Resources Will 
Lead to Better Weapon System Outcomes, [hyperlink, 
http://www.gao.gov/products/GAO-01-288] (Washington, D.C.: Mar. 8, 
2001); Best Practices: Capturing Design and Manufacturing Knowledge 
Early Improves Acquisition Outcomes, [hyperlink, 
http://www.gao.gov/products/GAO-02-701] (Washington, D.C.: July 15, 
2002); Defense Acquisitions: A Knowledge-Based Funding Approach Could 
Improve Major Weapon System Program Outcomes, [hyperlink, 
http://www.gao.gov/products/GAO-08-619] (Washington, D.C.: July 2, 
2008); Best Practices: High Levels of Knowledge at Key Points 
Differentiate Commercial Shipbuilding from Navy Shipbuilding, 
[hyperlink, http://www.gao.gov/products/GAO-09-322] (Washington, D.C.: 
May 13, 2009); and Best Practices: DOD Can Achieve Better Outcomes by 
Standardizing the Way Manufacturing Risks Are Managed, [hyperlink, 
http://www.gao.gov/products/GAO-10-439] (Washington, D.C: Apr. 22, 
2010). 

[10] Because knowledge points and best practices differ for 
shipbuilding programs, we exclude the five shipbuilding programs from 
some of our analysis at each of the three knowledge points. 

[11] According to DOD policy at the time of our questionnaire, 
technology should be demonstrated in a relevant environment or, 
preferably, in an operational environment. In addition, a major 
defense acquisition program generally may not receive approval for 
development start until the milestone decision authority certifies 
that the technology in the program has been demonstrated in a relevant 
environment. 10 U.S.C. § 2366b(a)(3)(D). 

[12] Demonstration in a relevant environment is Technology Readiness 
Level (TRL) 6. Demonstration in a realistic environment is TRL 7. See 
appendix V for detailed description of TRLs. 

[13] The MQ-9 Reaper program also reported all critical technologies 
as fully mature at development start. However, that technology 
assessment reflects the Reaper Block 5 configuration and not the 
original program. Our historical data shows that the Reaper program 
began development in 2004 with its technologies nearing maturity. 

[14] Pub. L. No. 111-23, § 205(a). A major defense acquisition program 
may not receive milestone B approval until the program has held a 
preliminary design review and the milestone decision authority has 
conducted a formal post-preliminary design review assessment and 
certified on the basis of such assessment that the program 
demonstrates a high likelihood of accomplishing its intended mission 
unless a waiver is properly granted by the milestone decision 
authority. 10 U.S.C. § 2366b(a)(2) and (d)(1). 

[15] We did not assess shipbuilding programs against this recommended 
practice to limit the development phase, as their development cycles 
do not align in a manner consistent with other programs. 

[16] DOD policy in place at the time of our review provided that a 
condition for exiting the technology development phase is that a 
system or increment be developed for production within a short time 
frame, defined as normally less than 5 years for weapon systems. 
Department of Defense 5000.02, Operation of the Defense Acquisition 
System, enc. 2, para. 5.d(7) (Dec. 8, 2008) (hereinafter cited as DODI 
5000.02 (Dec. 8, 2008). An interim version of this instruction was 
issued in November 2013. 

[17] According to JLTV program officials, a series of design 
understanding reviews were held with each of the program's three 
current contractors that served as the equivalent of a single critical 
design review. At the time of these reviews, all long-lead and 
critical designs had been completed and all three contractors had more 
than 90 percent of the design files under configuration control. 

[18] While the WIN-T Inc 3 program held a critical design review in 
December of 2013 that assessed the entirety of the developmental 
program, it later had its requirements and capabilities reduced 
through descoping options recommended at a configuration steering 
board review and approved by the Army acquisition executive in January 
2014. 

[19] We did not assess the five shipbuilding programs against this 
recommended practice as testing early system prototypes in these 
programs may not be practical. 

[20] To determine whether critical processes are in control, we used 
program reported Process Capability Index data and manufacturing 
readiness level assessments of the process capability and control sub-
thread. 

[21] The five shipbuilding programs we assessed were excluded from 
this portion of our analysis due to the differences in the production 
processes used to build ships. 

[22] DODI 5000.02, enc. 2, para. 6 (c)(6)(d) (Dec. 8, 2008). 

[23] Pub. L. No. 111-23. Office of the Under Secretary of Defense, 
Acquisition, Technology, and Logistics Memorandum: "Better Buying 
Power: Mandate for Restoring Affordability and Productivity in Defense 
Spending" (June 28, 2010). Office of the Under Secretary of Defense, 
Acquisition, Technology, and Logistics Memorandum: "Better Buying 
Power: Guidance for Obtaining Greater Efficiency and Productivity in 
Defense Spending" (Sept. 14, 2010). Office of the Under Secretary of 
Defense, Acquisition, Technology, and Logistics Memorandum: 
"Implementation Directive for Better Buying Power - Obtaining Greater 
Efficiency and Productivity in Defense Spending" (Nov. 3, 2010). 
Office of the Under Secretary of Defense, Acquisition, Technology, and 
Logistics Memorandum: "Better Buying Power 2.0: Continuing the Pursuit 
for Greater Efficiency and Productivity in Defense Spending" (Nov. 13, 
2012). Department of Defense Instruction (DODI) 5000.02 (Dec. 8, 2008) 
and Interim DODI 5000.02, Operation of the Defense Acquisition System 
(Nov. 25, 2013). As our data was collected prior to the release of the 
latest revision of DODI 5000.02 we did not use the new instruction as 
criteria for our assessments. 

[24] GAO, Weapons Acquisition Reform: Reform Act Is Helping DOD 
Acquisition Programs Reduce Risk, but Implementation Challenges 
Remain, [hyperlink, http://www.gao.gov/products/GAO-13-103] 
(Washington, D.C.: Dec. 14, 2012); Defense Acquisitions: DOD Can 
Improve Its Management of Configuration Steering Boards, [hyperlink, 
http://www.gao.gov/products/GAO-11-640] (Washington, D.C.: July 7, 
2011); Defense Acquisitions: Assessments of Selected Weapon Programs, 
[hyperlink, http://www.gao.gov/products/GAO-13-294SP] (Washington, 
D.C.: Mar. 28, 2013). 

[25] This analysis reflects 33 non-ship programs, of the 38 total, for 
which we have identified a production start date. Ships are excluded 
from this analysis as we assess production knowledge for ships 
differently. 

[26] GAO, Joint Strike Fighter: DOD Actions Needed to Further Enhance 
Restructuring and Address Affordability Risks, [hyperlink, 
http://www.gao.gov/products/GAO-12-437] (Washington, D.C.: June 14, 
2012); Missile Defense: Opportunity Exists to Strengthen Acquisitions 
by Reducing Concurrency, [hyperlink, 
http://www.gao.gov/products/GAO-12-486] (Washington, D.C.: Apr. 20, 
2012); and Best Practices: Capturing Design and Manufacturing 
Knowledge Early Improves Acquisition Outcomes, [hyperlink, 
http://www.gao.gov/products/GAO-02-701] (Washington, D.C.: July 15, 
2002). 

[27] Office of the Under Secretary of Defense, Acquisition, 
Technology, and Logistics Memorandum: "Better Buying Power: Guidance 
for Obtaining Greater Efficiency and Productivity in Defense Spending" 
(Sept. 14, 2010). Office of the Under Secretary of Defense, 
Acquisition, Technology, and Logistics Memorandum: "Implementation 
Directive for Better Buying Power - Obtaining Greater Efficiency and 
Productivity in Defense Spending" (Nov. 3, 2010). Office of the Under 
Secretary of Defense, Acquisition, Technology, and Logistics 
Memorandum: "Better Buying Power 2.0: Continuing the Pursuit for 
Greater Efficiency and Productivity in Defense Spending" (Nov. 13, 
2012). Office of the Under Secretary of Defense, Acquisition, 
Technology, and Logistics Memorandum: "Implementation Directive on 
Better Buying Power 2.0: Achieving Greater Efficiency and Productivity 
in Defense Spending" (Apr. 24, 2013). 

[28] Affordability goals are established at milestone A, the entry 
into technology development. After systems engineering trade-offs are 
completed during the technology development phase, these affordability 
goals then become affordability caps at milestone B, the start of 
system development, when a match is to be made between requirements 
and resources. We refer to the goals and caps collectively as 
affordability constraints. 

[29] One of the 32 programs that conducted a "should-cost" analysis--
the LCS program--reported "should-cost" savings of $5.8 billion in 
then-year dollars, which were not comparable to the base year data we 
received from other program and is not reflected in the $24 billion 
fiscal year 2014 constant dollar amount. 

[30] Pub. L. No. 111-23, §§ 202, 203; DOD Directive-Type Memorandum 09-
027 Implementation of the Weapon Systems Acquisition Reform Act of 
2009. 

[31] Open systems architecture is a design approach that includes 
standard interfaces and the use of modular components within a product 
(like a computer) that can be replaced easily. This allows the product 
to be refreshed with new, improved components made by a variety of 
suppliers. 

[32] Duncan Hunter National Defense Authorization Act for Fiscal Year 
2009, Pub. L. No. 110-417, § 814. 

[33] The cost of the F-35 aircraft under contract before the 
completion of developmental testing was calculated using the average 
procurement unit cost for both the airframe and engine as reported in 
the program's December 2012 Selected Acquisition Report. This unit 
cost estimate assumes the quantity benefits from additional purchases 
of F-35 aircraft by international partners and other foreign military 
sales. 

[34] DAMIR Purview is an executive information system operated by the 
Office of the Under Secretary of Defense for Acquisition, Technology, 
and Logistics/Acquisition Resources and Analysis. 

[35] We refer to research, development, test, and evaluation costs as 
research and development or simply as development costs in this 
report. Total acquisition cost includes research and development and 
procurement costs as well as acquisition related operation and 
maintenance and system-specific military construction costs. 

[36] GAO, Best Practices: Better Management of Technology Development 
Can Improve Weapon System Outcomes, [hyperlink, 
http://www.gao.gov/products/GAO/NSIAD-99-162] (Washington, D.C.: July 
30, 1999); and Best Practices: Better Matching of Needs and Resources 
Will Lead to Better Weapon System Outcomes, [hyperlink, 
http://www.gao.gov/products/GAO-01-288] (Washington, D.C.: Mar. 8, 
2001). 

[37] GAO, Best Practices: High Levels of Knowledge at Key Points 
Differentiate Commercial Shipbuilding from Navy Shipbuilding, 
[hyperlink, http://www.gao.gov/products/GAO-09-322] (Washington, D.C.: 
May 13, 2009). 

[38] Twelve large defense contractors are participants under the Test 
Program for Negotiation of Comprehensive Small Business Subcontracting 
Plans created by the National Defense Authorization Act for Fiscal 
Years 1990 and 1991. Pub. L. No. 101-189, § 834 (1989) and have each 
established a comprehensive subcontracting plan on a corporate, 
division or plant-wide basis under which a single summary subcontract 
report is submitted semi-annually for all covered DOD contracts. The 
test program has been extended by Congress several times with the 
current three year extension made by Pub. L. No. 112-81, § 866 (2011) 
to end on December 31, 2014. Participation in the test program is on a 
voluntary basis such that the 12 participants may have contracts where 
they are reporting on an individual basis as well as contracts where 
they are reporting on a comprehensive basis. 

[End of section] 

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