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Contract Management: Pilot Program Needed to Improve DOD Identification of Warranty Claims

NSIAD-00-3 Published: Oct 29, 1999. Publicly Released: Oct 29, 1999.
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Highlights

Pursuant to a legislative requirement, GAO provided information on the Department of Defense's (DOD) plans to develop a pilot program to use commercial sources to improve the collection of DOD claims under aircraft engine warranties, focusing on the: (1) benefits obtained by some private sector users of aircraft engine warranty services; and (2) efforts DOD has made the evaluate the feasibility of establishing a pilot program.

Recommendations

Matter for Congressional Consideration

Matter Status Comments
In order to fully test the concept of using the private sector to increase warranty recoveries, Congress may want to: (1) require the DOD undertake a pilot program; (2) authorize a 2-year pilot program; (3) authorize contractors to be paid, at least in part, for claims identified but not recovered by the end of the pilot program (once those recoveries are made); and (4) direct that the program be structured to allow the review of both active and expired aircraft engine warranties.
Closed – Not Implemented
A provision implementing this recommendation was not included in the FY 2000 or 2001 Defense Authorization Act and is not proposed in the 2002 act.

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Topics

Aircraft enginesCost effectiveness analysisDefense cost controlMaintenance costsPrivate sector practicesPrivatizationRepair costsWarrantiesU.S. Air ForceAirlines