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Report to Congressional Committees: 

March 2006: 

Defense Acquisitions: 

Assessments of Selected Major Weapon Programs: 

GAO-06-391: 

GAO Highlights: 

Highlights of GAO-06-391, a report to congressional committees: 

Why GAO Did This Study: 

In the last 5 years, the Department of Defense (DOD) has doubled its 
planned investments in new weapon systems from about $700 billion in 
2001 to nearly $1.4 trillion in 2006. While the weapons that DOD 
develops have no rival in superiority, weapon systems acquisition 
remains a long-standing high risk area. GAO’s reviews over the past 30 
years have found consistent problems with weapon acquisitions such as 
cost increases, schedule delays, and performance shortfalls. In 
addition, DOD faces several budgetary challenges that underscore the 
need to deliver its new weapon programs within estimated costs and to 
obtain the most from these investments. 

This report provides congressional and DOD decision makers with an 
independent, knowledge-based assessment of selected defense programs 
that identifies potential risks and needed actions when a program’s 
projected attainment of knowledge diverges from the best practices. 
Programs for the assessments were selected based on several factors 
including, (1) high dollar value, (2) stage in acquisition, and (3) 
congressional interest. The majority of the 52 programs covered in this 
report are considered major defense acquisition programs by DOD. This 
report also highlights higher level issues raised by the cumulative 
experiences of individual programs. GAO updates this report annually 
under the Comptroller General’s authority. 

What GAO Found: 

GAO assessed 52 systems that represent an investment of over $850 
billion, ranging from the Missile Defense Agency’s Airborne Laser to 
the Army’s Warfighter Information Network-Tactical. DOD often exceeds 
development cost estimates by approximately 30 to 40 percent and 
experiences cuts in planned quantities, missed deadlines, and 
performance shortfalls. Such difficulties, absent definitive and 
effective reform outcomes, are likely to cause great turmoil in a 
budget environment in which there are growing fiscal imbalances as well 
as increasing conflict over increasingly limited resources. While these 
problems are in themselves complex, they are heightened by the fact 
that this current level of investment is by no means final and 
unchangeable. A large number of the technologies under development in 
these systems are sufficiently new and immature that it is uncertain 
how long it will take or how much it will cost to make them 
operational. 

Most of the 52 programs GAO reviewed have proceeded with lower levels 
of knowledge than suggested by best practices. Programs that start with 
mature technologies do better. As shown in the figure below, programs 
that began with immature technologies have experienced average research 
and development cost growth of 34.9 percent; programs that began with 
mature technologies have only experienced cost growth of 4.8 percent. 

Average Program Research, Development, Test, and Evaluation Cost Growth 
from First Full Estimate: 

[See PDF for image] 

[End of figure] 

If DOD continues to move programs through development without requisite 
technology, design, and production knowledge, costs and schedules will 
increase, which will reduce the quantity delivered to the warfighter. 
This practice will also continue to reduce DOD’s buying power, as less 
capability will be provided for the money invested. In the larger 
context, DOD needs to make changes in its requirements and budgeting 
processes that are consistent with getting the desired outcomes from 
the acquisition process. 

www.gao.gov/cgi-bin/getrpt?GAO-06-391. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Paul L. Francis at (202) 
512-4841 or FrancisP@gao.gov. 

[End of section] 

Contents: 

Forword: 

Letter: 

Fiscal Challenges Confronting DOD Necessitate Better Acquisition 
Outcomes: 

DOD's Weapon Programs Portfolio Often Experiences a Reduced Return on 
Investment: 

A Knowledge-Based Approach Can Lead to Better Acquisition Outcomes: 

Most Programs Proceed with Lower Levels of Knowledge at Critical 
Junctures: 

Historically, Most Cost Growth Is Reported after the Critical Design 
Review: 

How to Read the Knowledge Graphic for Each Program Assessed: 

Assessments of Individual Programs: 

Airborne Laser (ABL): 

Aerial Common Sensor (ACS): 

Advanced Deployable System (ADS): 

Aegis Ballistic Missile Defense (Aegis BMD): 

Advanced Extremely High Frequency (AEHF) Satellites: 

Active Electronically Scanned Array Radar (AESA): 

Advanced Precision Kill Weapon System (APKWS): 

Advanced SEAL Delivery System (ASDS): 

Advanced Threat Infrared Countermeasure/Common Missile Warning System: 

B-2 Radar Modernization Program (B-2 RMP): 

C-130 Avionics Modernization Program (C-130 AMP): 

C-5 Avionics Modernization Program (C-5 AMP): 

C-5 Reliability Enhancement and Reengining Program (C-5 RERP): 

CH-47F: 

Future Aircraft Carrier CVN-21: 

DD(X) Destroyer: 

E-2D Advanced Hawkeye (E-2D AHE): 

Evolved Expendable Launch Vehicle (EELV) - Atlas V, Delta IV: 

Expeditionary Fighting Vehicle (EFV): 

Excalibur Precision Guided Extended Range Artillery Projectile: 

F-22A Raptor: 

Future Combat Systems (FCS): 

Global Hawk Unmanned Aircraft System: 

Ground-Based Midcourse Defense (GMD): 

Navstar Global Positioning System (GPS) II Modernized Space/OCS: 

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

Joint Strike Fighter (JSF): 

Joint Tactical Radio System Airborne, Maritime, Fixed-Site (JTRS AMF): 

Joint Tactical Radio System (JTRS) Cluster 1: 

Joint Tactical Radio System (JTRS) Cluster 5: 

Joint Unmanned Combat Air Systems (J-UCAS): 

Kinetic Energy Interceptors (KEI): 

Land Warrior: 

Littoral Combat Ship (LCS): 

Longbow Apache Block III: 

Multi-mission Maritime Aircraft (MMA): 

21" Mission Reconfigurable Unmanned Undersea Vehicle (MRUUV): 

Mobile User Objective System (MUOS): 

National Polar-orbiting Operational Environmental Satellite System 
(NPOESS): 

PATRIOT/MEADS Combined Aggregate Program (CAP) Fire Unit: 

MQ-9 Predator B: 

Space Based Infrared System (SBIRS) High: 

Small Diameter Bomb (SDB): 

Space Radar (SR): 

Space Tracking and Surveillance System (STSS): 

Terminal High Altitude Area Defense (THAAD): 

Transformational Satellite Communications System (TSAT): 

V-22 Joint Services Advanced Vertical Lift Aircraft: 

VH-71A Presidential Helicopter Replacement Program: 

Warrior Unmanned Aerial Vehicle (Warrior UAV): 

Wideband Gapfiller Satellites (WGS): 

Warfighter Information Network-Tactical (WIN-T): 

Agency Comments: 

Scope of Our Review: 

Appendixes: 

Appendix I: Comments from the Department of Defense: 

Appendix II: Scope and Methodology: 

Macro Analysis: 

Historical Analysis: 

System Profile Data on Each Individual Two-Page Assessment: 

Product Knowledge Data on Each Individual Two-Page Assessment: 

Appendix III: Technology Readiness Levels: 

Appendix IV: GAO Contact and Acknowledgments: 

GAO Contact: 

Acknowledgments: 

Related GAO Products: 

Tables: 

Table 1: Total Projected Cost of DOD's Top Five Programs in Fiscal 
Years 2001 and 2006: 

Table 2: Cost and Cycle Time Growth for 26 Weapon Systems: 

Table 3: Examples of DOD Programs with Reduced Buying Power: 

Table 4: Programs in Our Assessment Yet to Hold a Critical Design 
Review: 

Figures: 

Figure 1: Percent of Programs That Achieved Technology Maturity at Key 
Junctures: 

Figure 2: RDT&E Percentage Increase throughout the Product Development 
Cycle for 29 Programs Completed or in Production: 

Figure 3: Depiction of a Notional Weapon System's Knowledge as Compared 
with Best Practices: 

Abbreviations: 

AMRDEC: Aviation and Missile Research Development and Engineering 
Center: 

ARS: analysis and reporting system: 

ATACMS BAT: Army Tactical Missile System Brilliant Antiarmor 
Submunition: 

BAMS: Broad Area Maritime Surveillance: 

CDA: Commander's Digital Assistant: 

CEC: Cooperative Engagement Capability: 

CMUP: Conventional Mission Upgrade Program: 

DARPA: Defense Advanced Research Projects Agency: 

DBCS: Dismounted Battle Command System: 

DOD: Department of Defense: 

EKV: exoatmospheric kill vehicle: 

EPLRS: Enhanced Position Location Reporting System: 

FY: fiscal year: 

GAO: Government Accountability Office: 

GEO: geosynchronous earth orbit: 

GMLRS: Guided Multiple Launch Rocket System: 

HEO: highly elliptical orbit: 

ICD: Interface Control Design: 

ISR: intelligence, surveillance, and reconnaissance: 

JASSM: Joint Air-to-Surface Standoff Missile: 

JDAM: Joint Direct Attack Munition: 

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

JPATS: Joint Primary Aircraft Training System: 

JSOW: Joint Standoff Weapon: 

MCS: Maneuver Control System: 

MDA: Missile Defense Agency: 

MDAP: Major Defense Acquisition Program: 

MEADS: Medium Extended Air Defense System: 

MIDS-LVT: Multifunctional Information Distribution System - Low Volume 
Terminal: 

MM III GRP: Minuteman III Guidance Replacement Program: 

NA: not applicable: 

NAS: National Airspace System: 

NASA: National Aeronautics and Space Administration: 

NOAA: National Oceanic and Atmospheric Administration: 

OCS: Operational Control System: 

OSD: Office of the Secretary of Defense: 

PTIR: precision track illumination radar: 

RDT&E: Research, Development, Test and Evaluation: 

SAR: Selected Acquisition Report: 

SDACS: Solid Divert and Attitude Control System: 

SDR: Systems Design Review: 

SOCOM: Special Operations Command: 

SPC: statistical process control: 

SUR: surveillance radar: 

TBD: to be determined: 

TBIP: Tomahawk Baseline Improvement Program: 

TRL: Technology Readiness Level: 

UAV: Unmanned Aerial Vehicle: 

UHF: ultra high frequency: 

U.S.C.: United States Code: 

Foreword March 31, 2006: 

Congressional Committees: 

Current and expected fiscal imbalances demand that the Department of 
Defense (DOD) maximize its return on investment and provide the 
warfighter with needed capabilities at the best value for the taxpayer. 
Since 1990, we have assessed weapon acquisitions as a high-risk area. 
Not only does it continue to be a high risk area, but it has also taken 
on heightened importance. To transform military operations, DOD has 
embarked on developing multiple megasystems that are expected to be the 
most expensive and complex ever. However, these costly acquisitions are 
running head-on into the nation's unsustainable fiscal path. In the 
past 5 years, DOD has doubled its planned investments in new weapon 
systems from $700 billion to $1.4 trillion. This huge increase has not 
been accompanied by more stability, better outcomes, or more buying 
power for the acquisition dollar. 

This is our fourth annual assessment of weapon programs. It contains 
our assessment of 52 weapon programs representing a projected 
investment of about $850 billion. Unfortunately, our assessments do not 
show appreciable improvement in the acquisition of major weapon 
systems. Rather, programs are experiencing recurring problems with cost 
overruns, missed deadlines, and performance shortfalls. These cost 
increases mean that DOD cannot produce as many weapons as intended nor 
deliver those weapons to the warfighter when promised. These problems 
occur, in part, because weapon programs do not capture the requisite 
knowledge when needed to efficiently and effectively manage program 
risks. Programs consistently move forward with unrealistic cost and 
schedule estimates, use immature technologies in launching product 
development, and fail to solidify design and manufacturing processes at 
appropriate points in development. 

The past year has seen several major defense reviews that lay down 
approaches to improve the way DOD buys weapons. These reviews contain 
many constructive ideas. If they are to produce better results, 
however, they must heed the lessons taught--but perhaps not learned--of 
acquisition history. Specifically, policy must be manifested in 
decisions on individual programs or reform will be blunted. DOD's 
current acquisition policy is a case in point. The policy supports a 
knowledge-based, evolutionary approach to acquiring new weapons. The 
practice--decisions made on individual programs--sacrifices knowledge 
and executability in favor of revolutionary solutions. It's time to 
challenge such solutions. Reform will not be real unless each weapon 
system is shown to be both a worthwhile investment and an executable 
program. Otherwise, we will continue to start more programs than we can 
finish, produce less capability for more money, and create the next set 
of case studies for future defense reform reviews. 

Signed by: 

David M. Walker: 
Comptroller General of the United States: 

Letter March 31, 2006: 

Congressional Committees: 

One of the single largest investments the federal government makes is 
the development and production of new weapon systems. In the last 5 
years, the Department of Defense (DOD) has doubled its planned 
investments in new weapon systems from about $700 billion in 2001 to 
nearly $1.4 trillion in 2006. It is imperative that these investments 
deliver as promised not only because of their value to the warfighter 
but because every dollar spent on weapon systems means one dollar less 
of something else DOD or the Government can do. There is ample basis 
for serious concerns on this score. The cost of developing a weapon 
system continues to often exceed estimates by approximately 30 percent 
to 40 percent. This in turn results in fewer quantities, missed 
deadlines, and performance shortfalls. In short, the buying power of 
the weapon system investment dollar is reduced; the warfighter gets 
less than promised; and opportunities to make other investments are 
lost. This is not to say that the nation does not get superior weapons 
in the end, but that at twice the level of investment, DOD has an 
obligation to get better results. In the larger context, DOD needs to 
make changes in its requirements and budgeting processes that are 
consistent with getting the desired outcomes from the acquisition 
process. 

Given growing fiscal imbalances as well as competition for increasingly 
scarce resources, this current level of investment is by no means final 
and unchangeable. To get better results, programs need to have higher 
levels of knowledge when they start, which enable better estimates of 
how much they will cost to finish. Currently, a large number of the 
technologies under development in major systems are sufficiently new 
and immature that it is uncertain how long it will take or how much it 
will cost to make them operational. Predictably, developing these 
systems without sufficient knowledge will take longer and cost even 
more than promised and deliver fewer quantities and other capabilities 
than planned. Over the years, we have made a number of recommendations 
to address these issues, both systemically and on individual programs. 

In this report, we assess 52 programs that represent an investment of 
approximately $858 billion.[Footnote 1] Our objective is twofold: to 
provide decision makers with a cross-cutting analysis of DOD weapons 
system investment and also to provide independent, knowledge-based 
assessments of individual systems' attained knowledge and potential 
risks. 

Programs were selected for individual assessment based on several 
factors including, (1) high dollar value, (2) stage in acquisition, and 
(3) congressional interest. The majority of the 52 programs covered in 
this report are considered major defense acquisition programs by DOD. 

Fiscal Challenges Confronting DOD Necessitate Better Acquisition 
Outcomes: 

DOD's investment in the research, development, test, and evaluation 
(RDT&E) and procurement of major weapon systems is expected to rise 
from $147 billion in fiscal year 2006 to $178 billion in fiscal year 
2011.[Footnote 2] DOD's total planned investment in Major Defense 
Acquisition Programs is nearly $1.4 trillion (2006 dollars) for its 
current portfolio, with over $840 billion of that investment yet to be 
made.[Footnote 3] 

Budget simulations by GAO, the Congressional Budget Office, and others 
show that, over the long term, we face a large and growing structural 
deficit due primarily to known demographic trends and rising health 
care costs. As the Comptroller General has noted, continuing on this 
unsustainable fiscal path will gradually erode, if not suddenly damage, 
our economy, our standard of living, and ultimately our national 
security. Federal discretionary spending, along with other federal 
policies and programs, will face serious budget pressures in the coming 
years stemming from new budgetary demands and demographic trends. 
Defense spending falls within the discretionary spending accounts. 
Further, current military operations, such as those in Afghanistan and 
Iraq, consume a large share of DOD budgets and are causing faster wear 
on existing weapons. Refurbishment or replacement sooner than planned 
is putting further pressure on DOD's investment accounts. 

At the same time DOD is facing these problems, programs are commanding 
larger budgets. DOD is undertaking new efforts that are expected to be 
the most expensive and complex ever and on which DOD is heavily relying 
to fundamentally transform military operations. Table 1 shows that just 
5 years ago, the top five weapon systems were projected to cost about 
$291 billion combined; today, the top five weapon systems are projected 
to cost about $550 billion. 

Table 1: Total Projected Cost of DOD's Top Five Programs in Fiscal 
Years 2001 and 2006: 

Billions of constant 2006 dollars. 

2001: Program: F-22A Raptor aircraft; 
2001: Cost: $65.0; 
2006: Program: Joint Strike Fighter aircraft; 
2006: Cost: $206.3. 

2001: Program: DDG-51 class destroyer ship; 
2001: Cost: $64.4; 
2006: Program: Future Combat Systems; 
2006: Cost: $127.5. 

2001: Program: Virginia class submarine; 
2001: Cost: $62.1; 
2006: Program: Virginia class submarine; 
2006: Cost: $80.4. 

2001: Program: C-17 Globemaster airlift aircraft; 
2001: Cost: $51.1; 
2006: Program: DDG-51 class destroyer ship; 
2006: Cost: $70.4. 

2001: Program: F/A-18E/F Super Hornet fighter aircraft; 
2001: Cost: $48.2; 
2006: Program: F-22A Raptor aircraft; 
2006: Cost: $65.4. 

Total; 
2001: Cost: $290.8; 
Total; 
2006: Cost: $550.0. 

Source: GAO analysis of DOD data. 

[End of table] 

The larger scope of development associated with these megasystems 
produces a much larger fiscal impact when cost and schedule estimates 
increase. The top 5 programs in 2001 and the top 5 programs in 2006 
have both experienced about a 40 percent increase in projected RDT&E 
costs from the first full estimate to the latest estimate. In the same 
base-year dollars, the total fiscal impact was much greater for the 
2006 top 5 programs, however, as RDT&E costs increased by $33.9 billion 
as opposed to $16.9 billion for the top 5 from 2001 because of the 
larger scope of development planned for the 2006 top 5 programs. The 
Joint Strike Fighter and Future Combat Systems contribute significantly 
to this projected cost growth, as their combined cost is greater than 
all of the top 5 programs in 2001. 

DOD's Weapon Programs Portfolio Often Experiences a Reduced Return on 
Investment: 

The way DOD develops and produces its major weapon systems has had 
disappointing consequences. A large number of the programs in our 
assessment are costing more and taking longer to develop than 
estimated. As shown in table 2, total RDT&E costs for 26 common 
set[Footnote 4] weapon programs increased by nearly $44.6 billion, or 
37 percent, over the original business case (the first full estimate). 
The same programs have also experienced an increase in the time needed 
to develop capabilities with a weighted-average schedule increase of 
nearly 17 percent.[Footnote 5] 

Table 2: Cost and Cycle Time Growth for 26 Weapon Systems: 

Billions of constant 2006 dollars 

Total cost; 
First full estimate: $547.7; 
Latest estimate: $627.4; 
Percentage change: 14.6%. 

RDT&E cost; 
First full estimate: $120.4; 
Latest estimate: $164.9; 
Percentage change: 37.0%. 

Weighted average acquisition cycle time[A]; 
First full estimate: 154.5 months; 
Latest estimate: 180.2 months; 
Percentage change: 16.7%. 

Source: GAO analysis of DOD data. 

[A] This is a weighted estimate of average acquisition cycle time for 
the 26 programs based on total program costs at the first full and 
latest estimates. The simple average for these two estimates was 112.1 
months for the first full estimate and 131.3 months for the latest 
estimate resulting in a 17.2 percent change. 

[End of table] 

Quantities for 9 of the common set programs have been reduced since 
their first estimate.[Footnote 6] In addition, the weighted-average 
program acquisition unit cost for 25 of the 26 programs increased by 
roughly 57 percent.[Footnote 7] 

The consequence of cost and cycle-time growth is manifested in a 
reduction of the buying power of the defense dollar. Table 3 
illustrates six programs included in this assessment with a significant 
reduction in buying power; we have reported similar outcomes in many 
more programs. For example, the Air Force initially planned to buy five 
Spaced Based Infrared System High satellites at a program acquisition 
unit cost of about $816 million (fiscal year 2006 dollars). Technology 
and design components matured late in the development of the satellite, 
which contributed to cost growth and four Nunn-McCurdy[Footnote 8] unit 
cost breaches. Now, the Air Force plans to buy 3 satellites at a 
program acquisition unit cost of about $3.4 billion, a 315 percent 
increase. 

Table 3: Examples of DOD Programs with Reduced Buying Power: 

[See PDF for image] 

[End of figure] 

A Knowledge-Based Approach Can Lead to Better Acquisition Outcomes: 

Over the last several years, we have undertaken a body of work that 
examines weapon acquisition issues from a perspective that draws upon 
lessons learned from best product development practices. Leading 
commercial firms expect that their program managers will deliver high- 
quality products on time and within budget. Doing otherwise could 
result in the customer walking away. Thus, those firms have created an 
environment and adopted practices that put their program managers in a 
good position to succeed in meeting these expectations. Collectively, 
these practices comprise a process that is anchored in knowledge. It is 
a process in which technology development and product development are 
treated differently and managed separately. The process of developing 
technology culminates in discovery--the gathering of knowledge--and 
must, by its nature, allow room for unexpected results and delays. 
Leading firms do not ask their product managers to develop technology. 
Successful programs give responsibility for maturing technologies to 
science and technology organizations, rather than the program or 
product development managers. The process of developing a product 
culminates in delivery and, therefore, gives great weight to design and 
production. The firms demand--and receive--specific knowledge about a 
new product before production begins. A program does not go forward 
unless a strong business case on which the program was originally 
justified continues to hold true. 

Successful product developers ensure a high level of knowledge is 
achieved at key junctures in development. We characterize these 
junctures as knowledge points. These knowledge points and associated 
indicators are defined as follows: 

* Knowledge point 1: Resources and needs match. This point occurs when 
a sound business case is made for the product--that is, a match is made 
between the customer's requirements and the product developer's 
available resources in terms of knowledge, time, money, and capacity. 
Achieving a high level of technology maturity at the start of system 
development is an important indicator 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. 

* Knowledge point 2: Product design is stable. This point occurs when a 
program determines that a product's design is stable--that is, it 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 development. 
Completion of at least 90 percent of engineering drawings at the system 
design review provides tangible evidence that the design is stable. 

* Knowledge point 3: Production processes are mature and the design is 
reliable. This point is achieved when it has been demonstrated that the 
company can manufacture the product within cost, schedule, and quality 
targets. A best practice is to ensure that all key 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. 

A result of this knowledge-based process is evolutionary product 
development, an incremental approach that enables developers to rely 
more on available resources rather than making promises about unproven 
technologies. Predictability is a key to success as successful product 
developers know that invention cannot be scheduled, and its cost is 
difficult to estimate. They do not bring a technology into new product 
development unless that technology has been demonstrated to meet the 
user's requirements. Allowing technology development to spill over into 
product development puts an extra burden on decision makers and 
provides a weak foundation for making product development estimates. 
While the user may not initially receive the ultimate capability under 
this approach, the initial product is available sooner and at a lower, 
more predictable cost. 

There is a synergy in this process, as the attainment of each 
successive knowledge point builds on the preceding one. Metrics gauge 
when the requisite level of knowledge has been attained. Controls are 
used to ensure a high level of knowledge is attained before making 
additional significant investments. Controls are considered effective 
if they are backed by measurable criteria and if decision makers are 
required to consider them before deciding to advance a program to the 
next level. Effective controls help decision makers gauge progress in 
meeting cost, schedule, and performance goals and ensure that managers 
will (1) conduct activities to capture relevant product development 
knowledge, (2) provide evidence that knowledge was captured, and (3) 
hold decision reviews to determine that appropriate knowledge was 
captured to move to the next phase. The result is a product development 
process that holds decision makers accountable and delivers excellent 
results in a predictable manner. 

Most Programs Proceed with Lower Levels of Knowledge at Critical 
Junctures: 

To get the most out of its weapon systems investments, DOD revised its 
acquisition policy in May 2003 to incorporate a knowledge-based, 
evolutionary framework. The policy requires decision makers to have the 
knowledge they need before moving to the next phase of development. 
However, most of the programs we reviewed proceeded with lower levels 
of knowledge at critical junctures and attained key elements of product 
knowledge later in development than specified in DOD policy. Once a 
program gets behind in demonstrated knowledge, it stays behind (see 
fig. 1). 

Figure 1: Percent of Programs That Achieved Technology Maturity at Key 
Junctures: 

[See PDF for image] 

[End of figure] 

Only 10 percent of the programs in our assessment demonstrated all of 
their critical technologies as mature at the start of development, 
meaning they fell far short of attaining knowledge point 1 when they 
should have. By the time of their design review--when they should have 
demonstrated knowledge point 2 (stable design)--only 43 percent had 
actually attained knowledge point 1 (all critical technologies mature). 
By the time of the decision to start production when the programs 
should have demonstrated knowledge point 3 (production processes in 
control) one third still had not attained knowledge point 1. Similarly, 
only 35 percent of the programs in our assessment believed they had 
attained knowledge point 2 at the design review and only 58 percent 
believed they had attained knowledge point 2 by the time of the 
decision to start production. None of the programs we assessed that are 
now in production reported using statistical process control data to 
measure the maturity of production processes. This is the data needed 
to demonstrate knowledge point 3. In other words, none of the programs 
demonstrated knowledge point 3. This suggests that programs that follow 
the policy are the exception; the predominant practice is to still 
proceed with knowledge gaps. 

Consequences accrue to programs that are still working to mature 
technologies well into system development when they should be focused 
on maturing system design and preparing for production. These 
consequences involve increased risk of cost growth and schedule delays 
throughout the life of the program. The cost effect of proceeding 
without the necessary knowledge can be dramatic. For example, RDT&E 
costs for the programs that started development with mature 
technologies increased by a modest average of 4.8 percent over the 
first full estimate, whereas the RDT&E costs for the programs that 
started development with immature technologies increased by a much 
higher average of 34.9 percent over the first full estimate. Likewise, 
program acquisition unit costs for the programs with mature technology 
increased by less than 1 percent, whereas the programs that started 
development with immature technologies experienced an average program 
acquisition unit cost increase of nearly 27 percent over the first full 
estimate.[Footnote 9] 

In commenting on a draft of this report, DOD stated that it is the 
department's policy that technologies should be demonstrated in at 
least a relevant environment before a program enters system 
development; whereas, GAO utilizes the best practice standard that 
calls for technologies to be assessed one step higher--demonstration in 
an operational environment. If we applied the DOD's lower standard, the 
number of programs with mature technologies at program start would have 
increased to 23 percent, compared with 10 percent using the best 
practices standard. This is a higher number but does not alter the fact 
that most programs begin development without mature technology. A cost 
consequence for using the lower standard does occur, however. While the 
RDT&E cost growth for programs that started development with immature 
technologies (using the DOD standard) was about the same at 34.6 
percent, the cost growth for the programs that met DOD's maturity 
standard was significantly greater at 18.8 percent than the 4.8 percent 
experienced by those that met the higher best practice standard. 

The order of how knowledge is built throughout product development is 
important to delivering products on time and within cost. Knowledge 
gaps have a cumulative effect. For example, design stability cannot be 
attained if key technologies are not mature. The lack of technical 
maturity weakens the knowledge available at the design review. The 
majority of programs in our assessment that have held a design review 
did so without first maturing critical technologies. Twenty of the 52 
programs we assessed are currently scheduled to hold their critical 
design reviews by the year 2011. Only 2 of those 20 programs currently 
expect to have their technologies fully mature by the time of their 
design reviews, and only 4 of those 20 programs currently expect to 
have at least 90 percent design stability by the time of their critical 
design reviews. 

Historically, Most Cost Growth Is Reported after the Critical Design 
Review: 

We reviewed the development cost experience of 29 programs that have 
completed their product development cycle--the time between the start 
of development and production.[Footnote 10] We found a significant 
portion of the recognized total development cost increases of these 
programs took place after they were approximately half way into their 
product development cycle. These increases typically occurred after the 
time of the design review of the programs. As shown in figure 2, the 
programs experienced a cumulative increase in development costs of 28.3 
percent throughout their product development. Approximately 8.5 percent 
of the total development cost growth occurred up until the time of the 
average critical design review. The remaining 19.7 percent occurred 
after the average critical design review. 

Figure 2: RDT&E Percentage Increase throughout the Product Development 
Cycle for 29 Programs Completed or in Production: 

[See PDF for image] 

[End of figure] 

This historical pattern underscores the challenges DOD faces in 
executing programs currently in development. Table 4 lists the programs 
in our assessment that have yet to hold their critical design 
review.[Footnote 11] 

Table 4: Programs in Our Assessment Yet to Hold a Critical Design 
Review: 

Aerial Common Sensor. 

Advanced Deployable System. 

Advanced Precision Kill Weapon System. 

C-130 Avionics Modernization Program. 

Future Aircraft Carrier CVN-21. 

Future Combat Systems. 

Joint Land Attack Cruise Missile Defense Elevated Netted Sensor System. 

F-35 Joint Strike Fighter. 

Joint Tactical Radio System Cluster 5. 

Patriot/Medium Extended Air Defense System Combined Aggregated Program. 

Multi-mission Maritime Aircraft. 

Mobile User Objective System. 

National Polar--Orbiting Operational Environmental Satellite System. 

MQ-9 Predator B. 

Warrior UAV. 

Warfighter Information Network - Tactical. 

Source: GAO analysis of DOD data. 

Note: List includes only those programs that have started development. 
Four additional programs in our assessment have scheduled their 
critical design review but have not yet started development. 

[End of table] 

The current planned total RDT&E investment of these 16 programs is 
approximately $142 billion with a total planned investment of over $521 
billion. While most of these programs have yet to experience any 
significant cost increases, some have already experienced double digit 
cost increases prior to their design review. Furthermore, all 16 
programs listed began development with immature technologies--10 
currently still have over half of their critical technologies immature. 
For these programs, the markers for risk are present--historical 
experience and technology immaturity--as are the cost, schedule, and 
quantity consequences that attend that risk. If past is prologue, the 
decisions to continue to move programs through development without the 
requisite knowledge will continue to result in programs that are not 
delivered on time nor with the quantities and capabilities promised. 
These consequences are exacerbated in an environment of constrained 
resources as trade-offs become necessary not only within these 
programs, but across the entire weapons portfolio--resulting in a 
reduction of the department's buying power. 

How to Read the Knowledge Graphic for Each Program Assessed: 

We assess each program in two pages and depict the extent of knowledge 
in a stacked bar graph and provide a narrative summary at the bottom of 
the first page. As illustrated in figure 3, the knowledge graph is 
based on the three knowledge points and the key indicators for the 
attainment of knowledge: technology maturity (depicted in orange), 
design stability (depicted in green), and production maturity (depicted 
in blue). A "best practice" line is drawn based on the ideal attainment 
of the three types of knowledge at the three knowledge points. The 
closer a program's attained knowledge is to the best practice line, the 
more likely the weapon will be delivered within estimated cost and 
schedule. A knowledge deficit at the start of development--indicated by 
a gap between the technology knowledge attained and the best practice 
line--means the program proceeded with immature technologies and faces 
a greater likelihood of cost and schedule increases as technology risks 
are discovered and resolved. 

Figure 3: Depiction of a Notional Weapon System's Knowledge as Compared 
with Best Practices: 

[See PDF for image] 

[End of figure] 

An interpretation of this notional example would be that the system 
development began with key technologies immature, thereby missing 
knowledge point 1. Knowledge point 2 was not attained at the design 
review as some technologies were still not mature and only a small 
percentage of engineering drawings had been released. Projections for 
the production decision show that the program is expected to achieve 
greater levels of maturity but will still fall short. It is likely that 
this program would have had significant cost and schedule increases. 

We conducted our review from June 2005 through March 2006 in accordance 
with generally accepted government auditing standards. Appendix II 
contains detailed information on our methodology. 

Assessments of Individual Programs: 

Our assessments of the 52 weapon systems follow. 

[End of section] 

Airborne Laser (ABL): 

MDA's ABL element is being developed in incremental, capability-based 
blocks to destroy enemy missiles during the boost phase of their 
flight. Carried aboard a highly modified Boeing 747 aircraft, ABL 
employs a beam control/fire control subsystem to focus the beam on a 
target, a high-energy chemical laser to rupture the fuel tanks of enemy 
missiles, and a battle management subsystem to plan and execute 
engagements. We assessed the Block 2004 design that is under 
development and expected to lead to an initial capability in a future 
block. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Boeing; 
Program office: Kirtland AFB, N. Mex. 

Funding, FY06-FY11: 
R&D: $4,064.1 million; 
Procurement: $0.0 million; 
Total funding: $4,064.1 million; 
Procurement quantity: NA. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

Latest costs include all costs from the program's inception through 
fiscal year 2009. Total known cost through fiscal year 2011 is $7,416.2 
million. 

Although program officials expected ABL to provide an initial 
capability during Block 2006, this event has been delayed and only one 
of its seven critical technologies is fully mature. During Block 2004, 
the program continues work on a prototype expected to provide the basic 
design for a future operational capability. Program officials expect to 
demonstrate the other six technologies during a prototype flight test, 
in late 2008, that will assess ABL's lethality. MDA has released about 
94 percent of the engineering drawings for the prototype's design, 
which will be the basis for an initial operational capability during a 
future block if the test is successful. However, additional drawings 
may be needed if the design is enhanced or if problems encountered 
during flight-testing force design changes. 

[See PDF for image] 

[End of figure] 

ABL Program: 

Technology Maturity: 

Only one of ABL's seven critical technologies--managing the high power 
beam--is fully mature. The program office assessed the remaining six 
technologies--the six-module laser, missile tracking, atmospheric 
compensation, transmissive optics, optical coatings, and jitter 
control--as nearly mature. According to program officials, all of these 
technologies are needed to provide the system with an initial 
operational capability. 

The program office assessed the six-module laser as being close to 
reaching full maturity. In November 2004, the program demonstrated the 
simultaneous firing of all six laser modules. However, the initial 
operation of the laser was too short to make meaningful predictions of 
its power, and problems experienced during recent tests limited the 
duration of lasing. In December 2005, the program conducted a longer 
duration test of the laser and was able to sustain the beam for more 
than 10 seconds. The program also produced approximately 83 percent of 
the laser's design power, which, according to program officials, is 
sufficient to achieve 95 percent of lethal range against all classes of 
ballistic missiles. 

The program recently completed a series of beam control/fire control 
flight tests and, as a result, has reassessed three of its critical 
technologies--transmissive optics, optical coatings, and jitter 
control--as nearing full maturity. The program plans to demonstrate all 
technologies in an operational environment during a flight test of the 
system prototype, referred to as lethal demonstration, in which ABL 
will attempt to shoot down a short-range ballistic missile. Challenges 
with integrating the laser and beam control/fire control subcomponents 
have delayed this test into late 2008. 

Design Stability: 

We could not assess the design stability because ABL's initial 
capability will not be fully developed until the second aircraft is 
well underway. While the program has released 10,280 of the 10,910 
engineering drawings for the prototype, it is unclear whether the 
design of the prototype aircraft can be relied upon as a good indicator 
of design stability for the second aircraft. More drawings may be 
needed if the design is enhanced or if problems encountered during 
flight testing force design changes. 

Production Maturity: 

The program is producing a limited quantity of hardware for the 
system's prototype. However, we did not assess the production maturity 
of ABL because MDA has not made a production decision. 

Other Program Issues: 

In fiscal year 2004, MDA directed the ABL program to restructure its 
prime contract, increase its cost ceiling, and refocus the contractor's 
efforts on making technical progress. However, recent technical 
challenges associated with the program's beam control/fire control 
flight test series and long duration laser testing are causing further 
cost growth and schedule slippage for the program. Since our last 
assessment in January 2005, ABL's planned budget through fiscal year 
2009 increased by $483 million (9.4 percent), primarily in fiscal year 
2009. 

The program plans to award a contract for the second ABL aircraft, 
initially to include only trade studies, in fiscal year 2009. MDA has 
budgeted approximately $16 million for these trade study initiatives in 
an effort to determine the second aircraft system performance 
capabilities and to initiate the design of the second weapon system. 
However, program officials stated that the commitment to purchase a 
second aircraft will not be made until after the system prototype's 
lethal demonstration. 

Agency Comments: 

In commenting on a draft of this assessment, MDA provided technical 
comments, which were incorporated where appropriate. 

[End of section] 

Aerial Common Sensor (ACS): 

The Army's ACS is an airborne reconnaissance, intelligence, 
surveillance, and target acquisition system and is being designed to 
provide timely intelligence data on threat forces to the land component 
commander. The ACS will replace the Guardrail Common Sensor and the 
Airborne Reconnaissance Low airborne systems. ACS will co-exist with 
current systems until it is phased in and current systems retire. The 
Navy will also acquire ACS to replace its current airborne intelligence 
platform, the EP-3. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Lockheed Martin; 
Program office: Fort Monmouth, N.J. 

Funding needed to complete: 
R&D: $879.1 million; 
Procurement: $2,892.9 million; 
Total funding: $3,775.6 million; 
Procurement quantity: 33. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

These costs and quantities are expected to change due to the ACS 
program restructuring, as is the acquisition timeline. 

Due to a significant increase in the weight to integrate the prime 
mission equipment on the platform, the Army terminated the development 
contract. However, the ACS program will continue although development 
effort will be scaled back. At development start, only one of ACS' six 
critical technologies was fully mature and two more were nearing 
maturity. Currently, one additional technology is nearing maturity. The 
Army expected to have demonstrated the maturity of all but one critical 
technology by the design review, which was scheduled for December 2006. 
The program office estimated that 50 percent of drawings would have 
been releasable at that time. The Army plans to reevaluate 
requirements, possibly eliminating some, which will likely affect the 
system's technologies, design, cost, and schedule. 

[See PDF for image] 

[End of figure] 

ACS Program: 

Technology Maturity: 

Only one of ACS's six critical technologies was mature when the program 
started development in July 2004 and two more were nearing maturity. 
When the Army terminated the development contract, one additional 
technology was nearing maturity. The maturity of one of the remaining 
technologies was tied to the development of the airborne version of the 
Joint Tactical Radio System, which would not have been available until 
after ACS was fielded. The Army expected that all of the critical 
technologies except the one tied to the radios would be fully mature by 
2006. It is not clear at this time which requirements might be 
eliminated or the resulting impact to the technology maturity. 

Design Stability: 

The program office estimated that 50 percent of the drawings expected 
for ACS would have been  by the design review, which was scheduled for 
December 2006. However, solving the problem of the increased weight to 
integrate the prime mission equipment will likely affect the system's 
design. 

Other Program Issues: 

In December 2004, five months after the program began development, the 
contractor informed the Army that the weight to integrate prime mission 
equipment onto the selected platform had exceeded the structural limits 
of the aircraft. In January 2005, a contractor team including Lockheed 
Martin and the integration subcontractor initiated a risk mitigation 
strategy to address the problem. At the Army's and Navy's direction, 
the contactor also began to explore using a larger aircraft. In May 
2005, the program manager submitted a program deviation report 
notifying DOD that the issue would likely lead to a nonrecoverable 
program schedule breach. At the Army's request, the Navy convened a 
review team to study the problem without advocating a particular 
solution. In September the review team reported back to the Army. The 
team identified several factors that contributed to the problem, 
including inadequate prime contractor program management as evidenced 
by instability on the contractor's engineering team, lack of design 
specifications for the subcontractors, and insufficient exploration of 
the integration challenges during technology development. 

In September 2005, the Army ordered the contractor to stop all work 
under the current contract except for work necessary to provide a 
written plan with solutions and alternative strategies to maximize 
performance and minimize cost and schedule impacts to the government. 
In November, the contractor briefed the Army on three courses of 
action: refine the configuration to reduce requirements and keep the 
current platform; allow the contractor to acquire a larger platform 
that can accommodate the current prime mission equipment; or decouple 
the platform from system development and have the contractor deliver 
only the prime mission equipment. The Army rejected all three solutions 
and in January 2006, terminated the development contract for the 
convenience of the government. The Army has not yet estimated the 
effect to the development cost and schedule. 

Recent funding cuts appear to reduce the total program cost by $43.1 
million in current year dollars. Reductions were due to reprogramming 
and changes in inflation indices. 

Agency Comments: 

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

[End of section] 

Advanced Deployable System (ADS): 

The Navy's ADS is a rapidly deployable undersea surveillance system, 
scheduled for initial deployment as part of the antisubmarine warfare 
mission package on the Littoral Combat Ship (LCS). ADS is designed to 
detect, track, and report conventional and nuclear submarines in 
shallow waters by laying sensor fields on the ocean floor that send 
data back to the LCS for processing and analysis. We assessed the 
entire system, including its sensors, sensor installation system, in- 
buoy processors, and onboard analysis and reporting system. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Lockheed Martin; 
Program office: San Diego, Calif. 

Funding needed to complete: 
R&D: $219.6 million; 
Procurement: $581.3 million; 
Total funding: $809.7 million; 
Procurement quantity: 15. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

The ADS program entered system development in November 2005 with none 
of its four critical technologies mature. The sensors and the on-board 
processing system are more mature because they leverage existing Navy 
technology. Program officials identified several remaining risks for 
ADS, however, such as the ability of the system to relay data from the 
in-buoy processor to the on-board analysis and reporting system and the 
successful deployment and installation of sensors. According to the 
program office, all technologies are expected to reach maturity in 
2007. ADS is expected to be fully operational with the delivery to LCS 
in 2009. We were unable to assess design stability due to a lack of 
design data at this time. 

[See PDF for image] 

[End of figure] 

ADS Program: 

Technology Maturity: 

None of ADS's four critical technologies reached maturity by the start 
of system development in November 2005. Program officials stated, 
however, that the maturity of all critical technologies will be 
demonstrated through complete end-to-end system testing in fiscal year 
2007. 

Two critical technologies--the sensor subsystem, consisting of sensors 
and fiber optic connecting cables, and the on-board analysis and 
reporting system (ARS)--are relatively mature, in part because they 
leverage existing technologies. The ARS is comprised of previously 
developed software and only requires repackaging and integration into 
the ADS. However, although the ARS currently meets its requirements, an 
ongoing challenge is developing enhanced automation tools to reduce 
operator workload, due to limited space on the LCS. The sensor system 
is relatively mature because it uses sensors from previous program 
development. Prototypes of both technologies have already been tested 
in the ocean environment. 

The remaining two critical technologies are less mature, and face 
several risks and challenges. The in-buoy processor system, which 
compresses and processes data from the ocean floor before sending it to 
the LCS, is still in early development. According to program officials, 
the system's ability to transfer data to the ARS is a high-risk area. 
Recent risk reduction efforts aimed to address this issue. The system 
may also employ a reduced-range radio technology as a fallback 
technology. Additional development challenges for ADS include improving 
the overall survivability of the buoys and increasing their endurance. 

The sensor installation system, which deploys and installs sensors on 
the ocean bottom, is complicated by its dependence on many smaller 
technologies. Successful installation of sensors, as well as the 
survivability of connector cables--from fish bites and trawling, for 
example--are major development concerns. Back-up options for sensor 
installation include deploying the arrays manually, as demonstrated in 
a 2003 test or using a deployment vehicle that was demonstrated in a 
fleet exercise in 1999. Recent risk reduction efforts, however, have 
improved the system's performance. In 2004 and 2005, for example, 
sensor deployment and high-speed cable pullout were demonstrated 
successfully. 

Design Stability: 

We were unable to assess ADS design stability due to a lack of design 
data at this time. 

Other Program Issues: 

Originally designed for deployment on another platform, the ADS program 
was redirected in 2003 to focus its initial increment on deployment 
from the LCS. This developmental change caused some redesign of the 
program, but incorporated previously developed sensors and processing 
algorithms. Moreover, although future spirals will provide the 
capability to deploy ADS from an alternate platform, the first 
increment of ADS is wholly focused on deployment from the LCS. 

The LCS also only allows for limited manpower to support ADS processing 
operations. To maximize efficiency, operators may need to be trained in 
multiple systems of the LCS's antisubmarine warfare mission area. ADS 
program officials are concerned that operators may not have the 
expertise necessary to employ ADS effectively. 

Agency Comments: 

In commenting on this assessment, the Navy stated that according to its 
standards two ADS technologies--the sensor subsystem and the ARS--are 
already mature. According to Navy officials, they evaluate ADS 
technology maturity based on standards set by a Naval research group, 
which considers technologies mature when they have been demonstrated in 
a relevant, rather than an operational environment. 

The Navy stated that it is making progress in reducing risks on key 
technologies through the execution of a Technology Maturity Plan. 
Specifically, Navy officials stated that they are mitigating system 
risks through additional testing of the sensor installation system and 
risk mitigation planning. 

[End of section] 

Aegis Ballistic Missile Defense (Aegis BMD): 

MDA's Aegis BMD element is a sea-based missile defense system being 
developed in incremental, capability-based blocks to protect deployed 
U.S. forces, allies, and friends from short-and medium-range ballistic 
missile attacks. Key components include the shipboard SPY-1 radar, hit- 
to-kill missiles, and command and control systems. It will also be used 
as a forward-deployed sensor for surveillance and tracking of 
intercontinental ballistic missiles. We assessed only Block 2004 of the 
element's missile, the Standard Missile 3 (SM-3). 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Lockheed Martin (AWS), Raytheon (SM-3); 
Program office: Arlington, Va. 

Funding FY06-FY11: 
R&D: $4,962.1 million; 
Procurement: $0.0 million; 
Total funding: $4,962.1 million; 
Procurement quantity: NA. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

Costs and quantities are for all known blocks from the program's 
inception through fiscal year 2009. Total known program cost through 
fiscal year 2011 is $10,038.4 million and total quantities are 101. 

[End of table] 

According to program officials, the Block 2004 increment of SM-3 
missiles being fielded during 2004-2005 has mature technologies and a 
stable design. However, the program deferred full functionality of the 
missile's Solid Divert and Altitude Control System, which maneuvers the 
missile's kinetic warhead to its target, to a future upgrade. Program 
officials noted that even with reduced capability, the first increment 
of missiles provide a credible defense against a large population of 
the threat. All drawings for the first increment of missiles have been 
released to manufacturing. The program is not collecting statistical 
data on its production process but is using other means to gauge 
production readiness. 

[See PDF for image] 

[End of figure] 

Aegis BMD Program: 

Technology Maturity: 

Program officials estimate that all three technologies critical to the 
SM-3 missile are mature. These technologies--the missile's third stage 
rocket motor and the kinetic warhead's infrared seeker and Solid Divert 
and Attitude Control System (SDACS)--have been tested in flight. While 
the first two technologies were fully demonstrated in flight tests, the 
SDACS, which steers the kinetic warhead, was only partially 
demonstrated. The SDACS operation in "pulse mode," which increases the 
missile's divert capability, failed during a June 2003 flight test. 
According to program officials, the test failure was likely caused by a 
defective subcomponent within the SDACS, a problem that should be 
corrected through specific design modifications. To implement these 
corrective actions, the program is deferring full functionality of the 
missile's SDACS technology to the next upgrade of the hit-to-kill 
missile. Program officials note that only partial functionality of the 
SDACS is required for Block 2004, which has been successfully 
demonstrated in flight tests. 

Design Stability: 

Program officials reported that the design for the first 11 SM-3 
missiles being produced during Block 2004 is stable with 100 percent of 
its drawings released to manufacturing. The program plans to implement 
design changes in subsequent blocks (delivered during 2006-2007) to 
resolve the SDACS failure witnessed in the June 2003 flight test. 

Production Maturity: 

We did not assess the production maturity of the SM-3 missiles being 
procured for Block 2004. Program officials stated that given the low 
quantity of missiles being produced, statistical process control data 
on the production process would have no significance. The Aegis BMD 
program is using other means to assess progress in production and 
manufacturing, such as integrated product team reviews, risk reviews, 
Engineering Manufacturing Readiness Levels, and missile metrics. 

Other Program Issues: 

The Aegis BMD element builds upon the existing capabilities of Aegis- 
equipped Navy cruisers and destroyers. Planned hardware and software 
upgrades to these ships will enable them to carry out the ballistic 
missile defense mission. In particular, the program is working to 
upgrade Aegis destroyers for surveillance and tracking of 
intercontinental ballistic missiles. Because this function is new to 
the element, the program has faced a tight schedule to develop and test 
this added functionality during the Block 2004 time frame. Although the 
program aims to upgrade ten destroyers as part of its Block 2004 
increment, this new functionality has been exercised in a limited 
number of flight tests and has never been validated in an end-to-end 
flight test with the GMD system, for which it is providing long range 
surveillance and tracking. Since our last assessment, Aegis BMD's 
planned budget through fiscal year 2009 increased by $453.5 million 
(5.6 percent), primarily in fiscal years 2008 and 2009. 

Agency Comments: 

The Program Office provided technical comments to a draft of this 
assessment, which were incorporated as appropriate. 

[End of section] 

Advanced Extremely High Frequency (AEHF) Satellites: 

The Air Force's AEHF satellite system will replenish the existing 
Milstar system with higher capacity, survivable, jam-resistant, 
worldwide, secure communication capabilities for strategic and tactical 
warfighters. The program includes satellites and a mission control 
segment. Terminals used to transmit and receive communications are 
acquired separately by each service. AEHF is an international 
partnership program that includes Canada, United Kingdom, and the 
Netherlands. We assessed the satellite and mission control segments. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Lockheed Martin; 
Program office: El Segundo, Calif. 

Funding needed to complete: 
R&D: $2,108.2 million; 
Procurement: $538.5 million; 
Total funding: $2,646.7 million; 
Procurement quantity: 1. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

According to the program office, the AEHF program's technologies are 
mature and the design is stable. However, in late 2004 the program was 
delayed 12 months because key cryptographic equipment would not be 
delivered in time and to allow the program time to replace some 
critical electronic components and add testing. Program officials 
stated the 12-month slip should allow ample time to resolve the issues, 
but added significant cost. Total program cost increased about $1 
billion. The program still faces schedule risk due to the continued 
concurrent development of two critical path items managed and developed 
outside the program. Current plans are to meet full operational 
capability with three AEHF satellites and the first Transformational 
Satellite Communications System (TSAT) satellite, but additional AEHF 
satellites may be acquired if there are deployment delays with TSAT. 

[See PDF for image] 

[End of figure] 

AEHF Program: 

Technology Maturity: 

According to the program office, all of the 14 critical technologies 
are mature, having been demonstrated in a relevant environment and most 
progressing into environmental and functional performance testing. 

Design Stability: 

AEHF's design is stable. Virtually all of the expected design drawings 
have been released. The program completed its system level critical 
design review in April 2004. 

Production Maturity: 

Production maturity could not be assessed as the program office does 
not collect statistical process control data. 

Other Program Issues: 

In late 2004, the concurrent development of two critical path items led 
to schedule delays and cost increases. The program was restructured in 
October 2004, when the National Security Agency did not deliver key 
cryptographic equipment to the payload contractor in time to meet the 
launch schedule. The restructuring added 12 months to the program to 
allow time to resolve the cryptographic delivery issues and resolve 
other program problems including replacement of critical electronic 
components and additional payload testing. Delaying the launches and 
resolving these issues added about $800 million to the program. Earlier 
cost increases brought the total increase to about $1 billion, 
incurring a Nunn-McCurdy breach in December 2004 (10 U.S.C. 2433) at 
the 15 percent threshold. 

The program still faces schedule risk due to the continued concurrent 
development of two critical path items developed and managed outside 
the program; the cryptographic components developed and produced by the 
National Security Agency and the Command Post Terminals managed by 
another Air Force Program Office. During 2005, the program developed 
emulators to simulate key cryptographic equipment to allow payload 
testing and integration to continue, and National Security Agency began 
delivery of some actual components, meeting its revised delivery dates. 

Program officials told us the mission control segment continues to meet 
or exceed its schedule and performance milestones. In addition, the 
program made progress in several areas including: completion of end-to- 
end testing for the payload and terminal communications utilizing test 
terminals, completion of static load testing on the satellite 
structure, and delivery of the flight cryptographic hardware, which has 
been installed and tested on the first satellite. 

Three AEHF satellite launches are scheduled for 2008, 2009, and 2010. 
In December 2002, satellites four and five were deleted from the 
program with the intention of using TSAT to achieve full operational 
capability. However, the AEHF contract contains options to buy 
additional satellites if there are deployment problems with TSAT. 

Agency Comments: 

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

[End of section] 

Active Electronically Scanned Array Radar (AESA): 

The Navy's AESA radar is one of the top upgrades for the F/A-18E/F 
aircraft. It is to be the aircraft's primary search/track and weapon 
control radar and is designed to correct deficiencies in the current 
radar. According to the Navy, the AESA radar is key to maintaining the 
Navy's air-to-air fighting advantage and will improve the effectiveness 
of the air-to-ground weapons. When completed, the radar will be 
inserted in new production aircraft and retrofitted into lot 26 and 
above aircraft. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: McDonnell Douglas, Corp. 

Program office: Patuxent River, Md. 

Funding needed to complete: 
R&D: $76.4 million; 
Procurement: $1,483.7 million; 
Total funding: $1,560.1 million; 
Procurement quantity: 373. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

Procurement funding for the radar is included in the funding for the 
F/A-18E/F and EA-18G aircraft programs. 

The AESA radar's critical technologies appear to be mature and the 
design appears stable. However, radar development continues during 
production. The program is tracking a number of risks with the 
technical performance of the radar. If problems are discovered, design 
changes could be required while the radar is in production. Software 
development continues to be the program's top challenge. Problems in 
developing radar software have resulted in deferring several advanced 
capabilities until future software configurations. Radar production 
faces a high risk in 2006 because a material for one of the radar's 
critical technologies is expected to go out of production. Several 
other development and production risks have not been resolved. 

[See PDF for image] 

[End of figure] 

AESA Program: 

Technology Maturity: 

A technology readiness assessment for the radar in fiscal year 2004 
determined that the four critical technologies were mature. To further 
ensure technology maturity, a final technology assessment was held in 
November 2005. 

Design Stability: 

Although the AESA design appears to be stable, development of the radar 
has continued during production. According to program officials, radar 
software continues to be the top program challenge. Several advanced 
radar capabilities have been deferred to future software 
configurations. The radar schedule could not be extended because it is 
directly tied to the F/A-18E/F schedule. According to the program 
office, these capabilities will not be deferred beyond the first 
deployment, and no key performance parameters will be affected by the 
deferral. Since the start of development, the number of lines of 
software code has increased by 17 percent, and software development 
costs have increased by over 40 percent. 

According to a program office risk assessment, other development risks 
could result in design changes: the radar may not be able to track 
sufficient targets simultaneously or detect tail targets at low 
altitude; radiation emissions may interfere with F/A-18E/F weapon 
systems; and the radar power supply may not prevent voltage modulation 
on the aircraft power system. Also, the radar simulation model 
integrated into the F/A-18 training simulator may not accurately 
represent radar operation and performance. Mitigation plans are in 
place to address the design risks and, according to the program office, 
the likelihood of a design change is minimal due to over 500 flights 
with the AESA radar. 

Production Maturity: 

We could not assess production maturity because statistical process 
control data are not being collected. Instead, manufacturing processes 
continue to be monitored and controlled at each manufacturing center 
and laboratory. Twenty percent of the 415 radars are to be procured 
during 4 low-rate production runs. The radar's third production run has 
been approved. Nine radars had been delivered as of August 2005. Most 
radars will be installed in F/A-18E/Fs on the aircraft production line, 
but 135 radars are to be retrofitted into already produced aircraft. 

Radar production continues to face a number of risks. A high risk 
involves a foam material for the radar's wideband radome, a critical 
technology. The manufacturer plans to stop producing the material in 
the 2006 time frame, which would affect future radar production. The 
program office plans to mitigate this risk by making a lifetime buy of 
the foam material. According to the program risk assessment, other 
risks include whether: radar manufacturing capacity can ramp up enough 
to meet production and reliability problems with a radar critical 
technology will allow initial radars to meet a specification. Also, low-
rate production is exceeding design-to-cost and firm, fixed-price 
costs. For example, the estimate at completion for the radar contract 
is projected to overrun the target cost by up to 34 percent. 

Other Program Issues: 

In response to a 1999 DOD directive, a requirement was added to the 
radar for antitamper protection to guard against exploitation of 
critical U.S. technologies. According to the program office, a 
successful critical design review for this requirement was completed in 
November 2005. While officials said there is a requirement for this 
protection to have no effect on radar performance, operational tests of 
antitamper models may identify problems that require design changes to 
the protection package. By then, 84 radars are expected to have been 
produced. 

Agency Comments: 

In commenting on a draft of this assessment, the Navy provided 
technical comments, which were incorporated as appropriate. 

[End of section] 

Advanced Precision Kill Weapon System (APKWS): 

The Army's APKWS is a precision-guided, air-to-surface missile designed 
to engage soft and lightly armored targets. The system is intended to 
add a new laser-based seeker to the existing Hydra 70 Rocket System and 
is expected to provide a lower cost, accurate alternative to the 
Hellfire missile. Future block upgrades are planned to improve system 
effectiveness. We assessed the laser guidance technology used in the 
new seeker. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: TBD; 
Program office: Huntsville, Ala. 

Funding needed to complete: 
R&D: $56.1 million; 
Procurement: $1,329.6 million; 
Total funding: $1,385.6 million; 
Procurement quantity: 71,565. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

Since our assessment of APKWS last year, the Milestone Decision 
Authority curtailed the program. We reported the APKWS entered 
development and held its design review before demonstrating its 
critical guidance technology was fully mature and that initial system- 
level testing identified problems with the design. According to program 
officials, placement of the laser seeker proved to be problematic. The 
combination of development cost overruns, a projected schedule slip of 
1-2 years, unsatisfactory contract performance, and environmental 
issues resulted in curtailment of the initial APKWS program in January 
2005. Program officials expect to award the contract for a restructured 
APKWS program in the second quarter of fiscal year 2006. Due to program 
uncertainty, we were unable to assess design, technology, or production 
maturity. 

[See PDF for image] 

[End of figure] 

APKWS Program: 

Technology Maturity: 

At the time of our last report, APKWS had one critical technology-- 
laser guidance. Since the laser technology was employed on other 
platforms, program officials considered it to be mature. However, 
according to program officials, integration of the laser on the fins 
rather than in the head of the missile proved to be more problematic 
then originally estimated. The configuration difficulty presented 
problems that the contractor could not overcome and keep the missile 
within cost and on schedule. The integration issue contributed to the 
cost overrun and protracted schedule, which subsequently led to program 
curtailment and restructuring. Program officials stated they have since 
identified several laser seeker and guidance and control systems 
suitable for the Guided Rocket requirement. Furthermore, program 
representatives feel they have sufficient information to proceed with 
the critical design review immediately after contract award. Because 
the contractor and the specific technical approach to be pursued are 
yet to be determined, we could not assess the maturity of the design, 
technology, or production for the restructured program. 

Other Program Issues: 

Although the APKWS program was scheduled to start production of the 
rocket in fiscal year 2006, a number of program problems related to 
development cost overruns, schedule slippage, and contract performance 
resulted in the Army Program Executive Officer for Missiles and Space 
curtailing the program in January 2005. Following curtailment, the Vice 
Chief of Staff of the Army validated the requirements and approved a 
restructured APKWS program and timeline. Program officials released a 
Draft Request for Proposal in June 2005 and are expecting to award a 
new contract for the restructured APKWS program during the second 
quarter of fiscal year 2006. According to program officials, the 
current fiscal year 2006 President's budget was prepared and submitted 
prior to the Milestone Decision Authority's decision to curtail the 
initial APKWS contract and restructure the program. Ongoing program 
office efforts to align program funding to the new structure have not 
yet been completed. 

Agency Comments: 

The Army provided technical changes, which were incorporated as 
appropriate. 

[End of section] 

Advanced SEAL Delivery System (ASDS): 

The Special Operations Forces' ASDS is a battery-powered dry interior 
hybrid combatant submersible for clandestine insertion/extraction of 
Navy SEALs and their equipment. It is carried to a deployment area by 
specially configured 688-class submarines. ASDS is intended to provide 
increased range, payload, on-station loiter time, endurance, and 
communication/sensor capacity over current submersibles. The 65-foot- 
long 8-foot-diameter ASDS is operated by a two-person crew and includes 
a lock out/lock in diving chamber. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Northrop Grumman Electronic Systems; 
Program office: Washington, D.C. 

Funding needed to complete: 
R&D: TBD; 
Procurement: TBD; 
Total funding: TBD; 
Procurement quantity: 0. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

The ASDS program is being restructured due to reliability problems with 
the first boat, and the production decision for additional units has 
been cancelled. Restructuring includes developing a reliability 
improvement plan and conducting a critical system review to identify 
issues that need to be addressed. ASDS design changes since our last 
report include replacing the silver-zinc battery with a lithium-ion 
battery, replacing the aluminum tail with a titanium tail, and several 
other modifications. At-sea development testing of the lithium-ion 
battery has been completed. Acoustic, or noise level problems, are 
being addressed; however, this requirement does not have to be met 
until delivery of the second ASDS boat. Until ASDS reliability is 
assessed, problems are addressed, and operational testing is completed, 
ASDS technology maturity and design stability remain uncertain. 

[See PDF for image] 

[End of figure] 

ASDS Program: 

Technology Maturity: 

The program office identified three ASDS critical technologies. 
Although two of the three technologies were mature at the time of our 
last assessment, since that time the aluminum tail (mature) has been 
replaced with a titanium tail. The silver-zinc battery was replaced 
with a lithium-ion battery. In an August 2005 at-sea development test 
of the battery, requirements for speed, range, and endurance were 
exceeded. Acoustic, or noise level problems, are being addressed. In 
earlier tests, the ASDS propeller was the source of the most 
significant noise, and a new composite propeller was installed before 
operational test and evaluation in 2003. Although program officials 
believe the improved propeller will significantly reduce the ASDS 
acoustic signature, precise acoustic measurements are incomplete. Other 
acoustic issues will be addressed on a time-phased basis because the 
acoustic requirement has been deferred until delivery of the second 
boat. 

Design Stability: 

The ASDS experienced a propulsion-related failure during Follow-on 
Operational Test and Evaluation in October 2005, and the Navy 
decertified ASDS from operational test readiness. The Navy is 
investigating the causes of the failure and plans to complete repairs 
and post-repair testing in January 2006. On November 30, 2005, the 
United States Special Operations Command (SOCOM) and the Navy announced 
the restructuring of the ASDS program to focus on correcting 
reliability deficiencies with the first boat and to conduct 
verification testing of improvements before continuing operational 
testing. The ASDS Reliability Action Panel, a panel of submarine and 
submersible technical experts from government and industry chartered by 
SOCOM and the Navy in September 2005, noted that there were numerous 
examples of unpredicted component reliability problems and failures 
resulting from design issues and that operational testing should not be 
resumed until completion of a detailed review of mission critical 
systems. 

Consequently, the production decision for additional units has been 
cancelled until the first boat's reliability has been improved. Under 
the ASDS restructuring plan, the critical system review is expected to 
identify known problems and other potential issues and identify what 
design changes are needed. A Vulnerability Assessment Report assessing 
ASDS survivability design features was issued in September 2005 and a 
Capabilities Production Document (to replace the June 2004 ASDS 
operational requirements document) is under review. Until the program's 
critical system review is completed, all requirements are addressed, 
technical problems are solved, and testing is completed, we believe the 
ASDS final design will remain uncertain and may have cost and schedule 
implications. Because the ASDS program is being restructured, we are 
not assessing the current level of ASDS design stability. 

Other Program Issues: 

In December 2004 SOCOM reduced the ASDS program quantity to three units 
due to resource constraints. However, it affirmed that the operational 
requirements document remained valid at six ASDS vehicles. 

Agency Comments: 

The Navy concurred with our assessment and provided updated costs, 
which were incorporated as appropriate. 

[End of section] 

Advanced Threat Infrared Countermeasure/Common Missile Warning System: 

The Army's and Special Operations' ATIRCM/CMWS is a component of the 
Suite of Integrated Infrared Countermeasures planned to defend U.S. 
aircraft from advanced infrared-guided missiles. The system will be 
employed on Army and Special Operations aircraft. ATIRCM/CMWS includes 
an active infrared jammer, missile warning system, and countermeasure 
dispenser capable of loading and employing expendables, such as flares, 
chaff, and smoke. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: BAE Systems North America; 
Program office: Huntsville, Ala. 

Funding needed to complete: 
R&D: $71.9 million; 
Procurement: $3,605.4 million; 
Total funding: $3,677.4 million; 
Procurement quantity: 2,458. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

The ATIRCM/CMWS program entered production in November 2003 with 
technologies mature and designs stable. However, one of the five 
critical technologies was recently downgraded due to continued 
technical difficulties. Currently, the program's production processes 
are at various levels of control. The CMWS portion of the program 
entered limited production in February 2002 to meet urgent deployment 
requirements. However, full-rate production for both components was 
delayed because of reliability problems. Over the past several years, 
the program has had to overcome cost and schedule problems brought on 
by shortfalls in knowledge. Key technologies were demonstrated late in 
development and only a small number of design drawings were completed 
by design review. At the low rate production decision point, the Army 
developed a new cost estimate reducing program procurement cost 
substantially. 

[See PDF for image] 

[End of figure] 

ATIRCM/CMWS Program: 

Technology Maturity: 

The five critical technologies were considered mature until a 
government/industry team recently downgraded the maturity level of the 
infrared jamming head due to technical issues. Additionally, the other 
four technologies did not mature until after the design review in 
February 1997. Most of the early technology development effort focused 
on the application to rotary wing aircraft. When system development 
began in 1995, requirements were expanded to include Navy and Air Force 
fixed wing aircraft. This change caused problems that contributed to 
cost increases of over 150 percent. The Navy and the Air Force 
subsequently dropped out of the program, but the Navy and the Army are 
currently pursuing future joint production planning. 

Design Stability: 

The basic design of the system is complete with 100 percent of the 
drawings released to manufacturing. The design was not stable at the 
time of the design review, with only 22 percent of the drawings 
complete due to the expanded requirements. Two years after the design 
review, 90 percent of the drawings were released and the design was 
stable. This resulted in inefficient manufacturing, rework, additional 
testing, and a 3-year schedule delay. 

Production Stability: 

Production maturity could not be assessed based on the information 
provided by the program office. According to program officials, the 
program has 21 key manufacturing processes in various phases of control 
(7 CMWS and 14 ATIRCM). The CMWS production portion of the system has 
stabilized and benefited from increased production rates. Also, 
processes supporting both ATIRCM and CMWS will continue to be enhanced 
as data is gathered and lessons learned will be included in the 
processes. The Army entered limited CMWS production in February 2002 to 
meet an urgent need. Subsequently, full rate production was delayed for 
both components due to reliability testing failures. The program 
implemented reliability fixes to six production representative 
subsystems for use in initial operational test and evaluation. These 
systems were delivered in March 2004. The full-rate production decision 
for the complete system was recently delayed until June 2010 due to 
ATIRCM performance issues. 

Other Program Issues: 

The Army uses the airframe as the acquisition quantity unit of measure 
even though it is not buying an ATIRCM/CMWS system for each aircraft. 
When the program began, plans called for putting an ATIRCM/CMWS on each 
aircraft. Due to funding constraints, the Army reduced the number of 
systems to be procured and will rotate the systems to aircraft as 
needed. The Army is buying kits for each aircraft, which include the 
modification hardware, wiring harness, cables necessary to install and 
interface the ATIRCM/CMWS to each platform. The Army plans to buy 1,710 
ATIRCM/CMWS systems and 3,571 kits to use for aircraft integration. As 
a result, the true unit procurement cost for each ATIRCM/CMWS system is 
more on the order of $2.8 million. 

The current program baseline includes accelerated funding to procure 
additional ATIRCM/CMWS systems additional nonrecurring engineering 
driven by an increase in the number and types of platforms. The 
quantity of ATIRCM/CMWS systems was increased from 1,076 to 1,710 in 
June 2005. A new Army cost position has been established that reflects 
the impact of the CMWS full rate production decision, the increased 
quantities, and the schedule delays. 

Agency Comments: 

The ATIRCM/CMWS program has been realigned to address Global War on 
Terrorism requirements and implement improvements. In response to a 
November 2003 memo from the Assistant Secretary of the Army to equip 
all Army helicopters in Iraq and Afghanistan with the most effective 
defensive systems, the program office proposed accelerating the CMWS 
portion of ATIRCM. To date, 506 installation kits and 214 CMWS's have 
been fielded. Full-rate production decision for CMWS required a 
separate Initial Operational Test and Evaluation, completed November 
2005. CMWS full rate production decision is planned for February 2006. 

The ATIRCM system experienced performance and reliability issues during 
October 2004 testing. The program has been rebaselined, allowing for 
improved performance, adding a multiband laser capability and increased 
ATIRCM system reliability. Full rate production is currently planned 
for fiscal year 2010. This rebaselined plan was presented and approved 
by the Army Acquisition Executive in December 2005. 

[End of section] 

B-2 Radar Modernization Program (B-2 RMP): 

The Air Force's B-2 RMP is designed to modify the current radar system 
to resolve potential conflicts in frequency band usage. To comply with 
federal requirements, the frequency must be changed to a band where the 
B-2 will be designated as a primary user. The modified radar system is 
being designed to support the B-2 stealth bomber and its combination of 
stealth, range, payload, and near precision weapons delivery 
capabilities. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Northrop Grumman; 
Program office: Dayton, Ohio: 

Funding needed to complete: 
R&D: $464.6 million; 
Procurement: $508.5 million; 
Total funding: $973.2 million; 
Procurement quantity: 14. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

The total quantity of 21 units includes 14 to be bought with 
procurement funds and 7 to be bought with R&D funds. All 21 units will 
eventually be placed on operational B-2 aircraft. 

Since our assessment of the B-2 RMP last year, the program successfully 
completed its design review in May 2005 with all four critical 
technologies considered mature. The program had released 85 percent of 
its design drawings by the design review and plans to have 100 percent 
released by the start of production. Program officials told us 
production maturity metrics will be formulated during development and 
these metrics may or may not include manufacturing process control 
data. The program plans to build seven radar units during development 
for pilot training with the B-2 wing prior to the planned completion of 
flight testing. Six of these units will later be modified and placed on 
B-2 aircraft. These units are necessary, but building them in 
development adds to the risk of later design changes because most of 
the radar flight testing will not occur until after these units are 
built. 

[See PDF for image] 

[End of figure] 

B-2 RMP Program: 

Technology Maturity: 

All four B-2 RMP critical technologies were considered mature at the 
design review in May 2005. While the program entered development in 
August 2004 with two of these four critical technologies mature and two 
approaching maturity, the receiver/exciter for the electronic driver 
cards and aspects of the antenna designed to help keep the B-2's radar 
signature low, all four are now considered mature. The program expects 
these technologies to reach a slightly higher level of maturity at the 
start of production in 2007. 

Design Stability: 

The program office completed its design readiness review in May 2005 
and at that time had 85 percent of its drawings released to 
manufacturing. The program plans to have 100 percent of its drawings 
released by the start of production in 2007. The program, however, does 
not use the release of design drawings as a measure of design maturity 
but instead uses the successful completion of design events, such as 
subsystem design reviews, as its primary measure of design maturity. 

Production Maturity: 

Production maturity metrics are planned to be formulated during 
development. These metrics, which may or may not include manufacturing 
process control data, are planned to be used as measures of progress 
toward production maturity during a production readiness review prior 
to the start of production in February 2007. The program is also 
involved in a proof-of-manufacturing effort to demonstrate that the 
transmit/receive modules can be built to specifications. 

Other Program Issues: 

The program plans to build seven radar units during development and 
later modify six of these units for placement on operational B-2 
aircraft. The Air Force needs these radar units for air crew training 
and proficiency operations. Even though these units are necessary, 
building them early in development adds risk because most of the radar 
flight-test activity will not occur until after these units are built. 

Agency Comments: 

The Air Force concurred with this assessment. 

[End of section] 

C-130 Avionics Modernization Program (C-130 AMP): 

The Air Force's C-130 AMP standardizes the cockpit configurations and 
avionics for 14 different mission designs of the C-130 fleet. It 
consolidates and installs the mandated DOD Navigation/Safety 
modifications, the Global Air Traffic Management systems, and the C-130 
broad area review requirements. It also incorporates other reliability, 
maintainability, and sustainability upgrades and provides increased 
situational awareness capabilities and reduces susceptibility of 
Special Operations aircraft to detection/interception. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Boeing; 
Program office: Dayton, Ohio: 

Funding needed to complete: 
R&D: $829.5 million; 
Procurement: $2,620.4 million; 
Total funding: $3,449.9 million; 
Procurement quantity: 454. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

The C-130 AMP is utilizing commercial and modified off-the-shelf 
technologies, and it entered system development with five of its six 
critical technologies mature. The final technology reached maturity in 
2005 through a series of demonstration flights. Program officials plan 
to release 90 percent of engineering drawings by the design review and 
have made progress toward that goal. As of December 2005, 100 percent 
of required drawings for Combat Delivery First Flight had been 
released. Program delays have resulted from funding cuts, and sustained 
development contract protests required a portion of the contract to be 
recompeted. The August 2005 design review has been postponed 
indefinitely, and the low rate initial production decision has been 
delayed until June 2006. These dates may change again after program 
restructuring is completed. 

[See PDF for image] 

[End of figure] 

C-130 AMP Program: 

Technology Maturity: 

All of the C-130 AMP's six critical technologies are fully mature, as 
the program is primarily utilizing proven commercial and modified off- 
the-shelf technology for all AMP capabilities. A program official 
stated that the last immature critical technology, Terrain Following 
and Terrain Avoidance radar, reached full maturity in 2005 by meeting 
the key requirement of operability at 250 feet during demonstration 
flights. 

Design Stability: 

As of December 2005, the program office had released 100 percent of 
required drawings for Combat Delivery First Flight. According to the 
Air Force, due to program restructuring, the Combat Talon critical 
design review was postponed indefinitely, and a new review date will be 
established under the current replan effort. 

The modernization effort is divided into a number of capability spirals 
due to the various aircraft designs. The first spiral will outfit C-130 
aircraft with core capabilities and an integrated defensive system. 
Special Operations C-130 aircraft will be outfitted first, and future 
spirals are planned for these aircraft because they require additional, 
and unique, defensive systems integration and enhanced situational 
awareness. 

Other Program Issues: 

Since GAO's last review of the C-130 AMP, the program office has 
postponed the design readiness review indefinitely, pushed back the low-
rate initial production 4 months, and delayed the production readiness 
review 18 months. 

Funding reductions in fiscal years 2003 and 2004 delayed the 
development program and contributed to the rescheduling of program 
milestones and the rebaselining of the program. In addition, sustained 
protests associated with the C-130 AMP development contract awarded in 
2001 required that a portion of the contract be recompeted. 

Agency Comments: 

The Air Force provided technical comments to a draft of this 
assessment, which were incorporated where appropriate. 

[End of section] 

C-5 Avionics Modernization Program (C-5 AMP): 

The Air Force's C-5 AMP is the first of two major upgrades for the C-5 
to improve the mission capability rate, transport capabilities and 
reduce ownership costs. The AMP implements Global Air Traffic 
Management, navigation and safety equipment, modern digital equipment, 
and an all-weather flight control system. The second major upgrade, the 
C-5 Reliability Enhancement and Reengining Program (RERP), replaces the 
engines and modifies the electrical, fuel, and hydraulic systems. We 
assessed the C-5 AMP. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Lockheed Martin; 
Program office: Dayton, Ohio: 

Funding needed to complete: 
R&D: $0.0 million; 
Procurement: $145.1 million; 
Total funding: $145.1 million; 
Procurement quantity: 12. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

Since our assessment of the C-5 AMP last year, the program completed 
developmental test and evaluation in August 2005, 10 months later than 
planned. The program's technologies and design are considered mature as 
they are relying on commercial-off-the-shelf technologies that are 
installed in other commercial and military aircraft. The main challenge 
to the program has been the development and integration of software--to 
which the schedule delay as well as a $23 million cost overrun has been 
attributed. The Air Force plans to modify 59 of the 112 C-5 aircraft. 
The Air Force is also seeking funding to modify the remaining 53 C-5s; 
however, that decision will not be made until the Air Force determines 
the correct mix of C-5 and C-17 aircraft needed to meet DOD's airlift 
needs. If the Air Force decides to use the C-17s, it may not upgrade 
some, or all, of the remaining 53 C-5s. 

[See PDF for image] 

[End of figure] 

C-5 AMP Program: 

Technology Maturity: 

We did not assess the C-5 AMP's critical technologies because the 
program used commercial technologies that are considered mature. 
Program officials stated that those technologies are in use on other 
aircraft and that they have not significantly changed in form, fit, or 
function. For example, the new computer processors are being used in 
the Boeing 777, 717, other commercial aircraft, the KC-10, and a Navy 
reconnaissance aircraft. 

Design Stability: 

Last year we reported that the C-5 AMP had released 100 percent of 
their drawings; however, due to modifications in the design an 
additional 270 drawings were added. As a result, the program had 
completed only 54 percent of the total number of drawings for the 
system by the time of the production decision. The program now reports 
that the contractor has released all of the drawings for the AMP. In 
addition, seven major subsystem-level design reviews were completed 
along with integration activities. Demonstration of these activities 
were completed during developmental test and evaluation, which started 
in December 2002 and was completed in August 2005. 

Production Maturity: 

We could not assess the production maturity because most components are 
readily available as commercial-off-the-shelf items. This equipment is 
being used on other military and commercial aircraft. In addition, the 
C-5 AMP is incorporating many other off-the-shelf systems and 
equipment, such as the embedded global positioning system, the inertial 
navigation system, and the multifunction control and display units. To 
ensure production maturity, the program office is collecting data 
regarding modification kit availability and the installation schedules. 

Other Program Issues: 

Over the past year, the AMP program ran into significant problems while 
trying to complete software development that have impacted the cost and 
schedule of the program. Most notably, a software build was added to 
fix problems with AMP integration, flight management system stability 
and system diagnostics. The added build caused a $23 million cost 
overrun, which was paid for by shifting funds from the RERP program, 
and extended developmental testing to 10 months. The program office 
acknowledged that an another software build may be added, depending on 
the results of operational testing that is now scheduled to be 
completed in July 2006. 

Last year we reported that the Air Force was conducting mobility 
studies to determine the correct mix of C-5 and C-17 aircraft it would 
need in the future. This decision has not been made yet. In the 
meantime, the program office is continuing its plan to provide AMP 
modifications for 59 of the aircraft while all 112 aircraft are 
projected to go through the RERP program. If all 112 aircraft are 
needed and do go through the RERP program, then the Air Force will need 
to request additional money to fund AMP modifications for the remaining 
53 aircraft. 

Agency Comments: 

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

[End of section] 

C-5 Reliability Enhancement and Reengining Program (C-5 RERP): 

The Air Force's C-5 RERP is one of two major upgrades for the C-5. RERP 
is designed to enhance the reliability, maintainability, and 
availability of the C-5 through engine replacement and modifications to 
subsystems, i.e. electrical and fuel, while the C-5 Avionics 
Modernization Program (AMP) is designed to enhance the avionics. The 
upgrades are part of a two-phased modernization effort to improve the 
mission capability rate, performance, and transport throughput 
capabilities and reduce total ownership costs. We assessed the C-5 
RERP. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Lockheed Martin; 
Program office: Dayton, Ohio: 

Funding needed to complete: 
R&D: $417.3 million; 
Procurement: $8,150.3 million; 
Total funding: $8,571.1 million; 
Procurement quantity: 109. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

The RERP is utilizing demonstrated commercial off-the-shelf components 
that require little or no modification. The program ensured that its 
technologies and design were stable at critical points in development. 
The program, which is currently in system development and 
demonstration, plans to enter low-rate production in December 2006. 
However, since last year the program has experienced a 9-month schedule 
delay due to multiple issues, such as a pylon redesign, and has been 
subject to almost $50 million in budget cuts that further increases 
schedule risk. The C-5 RERP program is also dependent on the number of 
aircraft approved to undergo the C-5 AMP modernization program. Until 
additional aircraft are approved for the AMP, it is uncertain how many 
aircraft will undergo the RERP. 

[See PDF for image] 

[End of figure] 

C-5 RERP Program: 

Technology Maturity: 

The C-5 RERP's technologies are mature based on an independent 
technology readiness assessment conducted in October 2001. New engines 
account for 64 percent of the expected improvement in mission 
capability rate for the aircraft. The new engines are commercial jet 
engines currently being used on numerous aircraft. According to the Air 
Force technology assessment, these engines have over 238 million flying 
hours of use. 

Design Stability: 

The C-5 RERP's design is undergoing changes due to a necessary redesign 
of the pylon/thrust reverser to address overweight conditions and 
safety concerns for the engine mount area. According to program 
officials, the redesign has contributed 4 months to the overall 9 month 
schedule delay of the program. Prior to this redesign, 98 percent of 
the design drawings were complete. It is unclear what effect the latest 
redesign will have on the completed drawings. According to the program 
office, the seven major subsystem level design reviews were completed 
before the December 2003 system-level design review. 

The program is taking advantage of AMP developed products and lessons 
learned in the C-5 RERP to reduce the risk of potential schedule slips 
associated with software development and integration. For example, 
according to program officials, some of the baseline software and 
systems integration facilities that were developed for C-5 AMP can be 
reused for RERP activities. 

Production Maturity: 

We did not assess the C-5 RERP's production maturity because the Air 
Force is buying commercially available items. However, we expect that 
production maturity would be at a high level because the engines have 
been commercially available for many years. 

Other Program Issues: 

The program has experienced a 9-month schedule delay since last year 
due to multiple issues including, pylon weight and redesign, asymmetric 
thrust reverser development problems, C-5 AMP delays, and wing rib web 
structure design and manufacture. The 9-month delay has cost the 
program an additional $45 million. In addition, recent budget 
reductions of almost $50 million are increasing the schedule risk of 
the program. Almost half of this money was shifted to the C-5 AMP to 
help that program complete software development activities. The 
remaining funds were cut by OSD because it appeared the program was 
under executing its funds. These cuts, along with the pylon development 
problems mentioned earlier, have forced the delay of the trainer 
program until fiscal year 2008. Program officials are also considering 
aggressive steps, such as hiring additional workers and using multiple 
shifts, to address potential schedule increases. 

RERP officials are currently monitoring negotiations between DOD and 
General Electric to bring General Electric into full compliance with 
the Berry Amendment, which requires certain metals used in military 
systems to be purchased from domestic sources. According to Air Force 
officials, General Electric expects to be in full compliance with the 
Berry Amendment by January 2007, without impact to C-5 RERP. 

The program is still waiting on the results of a mobility study to 
determine the mix of C-5 and C-17 aircraft the Air Force plans to use 
in the future. Until that decision is made, the Air Force is continuing 
its plan to re-engine all 112 C-5 aircraft. Before that can be done, 
however, all 112 will need to complete the AMP upgrade. Yet, the Air 
Force has only provided funding for 59 of the aircraft to receive the 
AMP upgrade at this time. 

Agency Comments: 

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

[End of section] 

CH-47F: 

The Army's CH-47F heavy lift helicopter is intended to provide 
transportation for tactical vehicles, artillery, engineer equipment, 
personnel, and logistical support equipment. It is also expected to 
operate in both day and night. The program goal is to enhance 
performance and extend the useful life of the CH-47 as well as produce 
new helicopters. This effort includes installing a digitized cockpit, 
rebuilding the airframe, and reducing aircraft vibration. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Boeing Helicopters; 
Program office: Huntsville, Ala. 

Funding needed to complete: 
R&D: $7.8 million; 
Procurement: $9,064.4 million; 
Total funding: $9,072.1 million; 
Procurement quantity: 454. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

The CH-47F technologies appear mature and the design stable, with 100 
percent of the engineering drawings released for manufacturing. CH-47F 
production maturity could not be assessed as the program is not 
collecting statistical process control data on key manufacturing 
processes. Program officials believe that CH-47F production is low risk 
because no new technology is being inserted into the aircraft, two 
prototypes have been produced, and the production process was 
demonstrated during the delivery of one low-rate initial production 
aircraft. Since our last assessment, the CH-47F program entered full 
rate production and increased quantities from 339 to 512 aircraft. 
Because the increase in quantities includes 55 new build helicopters, 
program unit cost increased approximately 12 percent over what we 
reported last year. 

[See PDF for image] 

[End of figure] 

CH-47F Program: 

Technology Maturity: 

We did not assess technology maturity or determine the number of 
critical technologies in detail. The CH-47F is a modification of the 
existing CH-47D helicopter. Program officials believe that all critical 
technologies are mature and have been demonstrated prior to integration 
into the CH-47F development program. 

Design Stability: 

The Army entered full rate production in November 2004, with 100 
percent of the drawings released to manufacturing. However, the number 
of drawings completed increased substantially since the start of low 
rate production. As a result, the level of maturity achieved at design 
review was only 11 percent and at low rate production was 31 percent. 
The majority of the new drawings were instituted to correct wire 
routing and installation on the aircraft. Accordingly, the program 
office believed the total number of drawings could not be determined 
until after the first prototype was delivered. 

Production Maturity: 

We did not assess production maturity because the CH-47F program does 
not collect statistical process control data on its production of 
helicopters. The program office relies on inspections as its means to 
ensure acceptable production results. 

According to the program office, the CH-47 production is low risk 
because two prototypes have been produced during development and the 
Army recently took delivery of its first low-rate initial production 
aircraft. Further, the program reported that during low-rate 
production, it made significant advances in the refinement of CH-47 
production processes. Advances include the implementation of the 
automated management execution system and the introduction of laser 
tracking to identify key mounting points. These enhancements are geared 
toward improving the manufacturing learning curve. However, the program 
office acknowledges that the program will lose some of the learning 
benefits during the anticipated break in production of the CH-47F in 
favor of producing more MG-47 special operations configuration 
helicopters during the next lot of production. 

Other Program Issues: 

In November 2004, the Army Acquisition Executive approved the revised 
program acquisition strategy and approved the start of full rate 
production. This acquisition strategy includes service life extension 
upgrades for the CH-47D fleet and a number of new-build aircraft to 
meet operational fleet requirements. Included in the new baseline is a 
revised acquisition objective quantity of 512 upgraded aircraft as 
opposed to the 339 previously reported. Of the larger quantity, 2 are 
developmental; 55 will be new build CH-47Fs; 58 will be remanufactured 
in the special operations configuration; and 397 remanufactured into CH-
47Fs to replace the current CH-47Ds. Because new builds, as opposed to 
only remanufactured helicopters, have been included in the acquisition 
plan, unit cost increased 12 percent over what we reported last year. 

Agency Comments: 

In commenting on a draft of this assessment, the Army concurred with 
the information presented in this report. One technical comment was 
provided, which was incorporated as appropriate. 

[End of section] 

Future Aircraft Carrier CVN-21: 

The Navy's CVN-21 class is the successor to the Nimitz-class aircraft 
carrier and includes a number of advanced technologies in propulsion, 
aircraft launch and recovery, weapons handling, and survivability. 
These technologies are to allow for increased sortie rates and 
decreased manning rates as compared to existing systems. Many of the 
technologies were intended for the second ship in the class, but they 
were accelerated into the first ship in a December 2002 restructuring 
of the program. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Northrop Grumman Newport News; 
Program office: Washington, D.C. 

Funding needed to complete: 
R&D: $2,370.0 million; 
Procurement: $23,457.7 million; 
Total funding: $25,827.7 million; 
Procurement quantity: 3. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

Costs decreased due to adjustments in inflation figures and refinements 
to third ship estimates. 

The CVN-21 entered system development in April 2004 with few of its 
critical technologies fully mature. This is due in part to DOD's 
decision to accelerate the installation of a number of technologies 
from the second ship to the first. Program officials state that the 
extended construction and design period allows further time for 
development. They have established a risk reduction strategy that 
includes decision points for each technology's inclusion based on a 
demonstrated maturity level. Fallback technologies exist for 11 of 18 
total critical technologies, but their use would lead to drawbacks, 
such as performance shortfalls and/or an increase in manpower 
requirements. The program has reported a 1-year schedule slip based on 
decisions to balance ship construction in the President's fiscal year 
2006 budget. Program officials expect to meet their design review date, 
currently set for March 2007. 

[See PDF for image] 

[End of figure] 

CVN-21 Program: 

Technology Maturity: 

There are currently a total of 18 CVN-21 critical technologies, of 
which 3 are presently mature and 3 are approaching maturity. The 
remaining 12 are at lower levels of maturity. The Navy expects that 14 
of the 18 total technologies will be mature or close to mature by the 
design review in fiscal year 2007, and they expect all but 1 technology 
to be near maturity by production start in 2008. Program officials 
originally reported 16 critical technologies at development start. 
However, one technology was re-defined into two, more specific 
technologies and another was added since that time. 

Six of the critical technologies are being developed by programs other 
than CVN-21. Progress in those programs could affect the CVN-21 
timeline. Those technologies are the Advanced Arresting Gear, Evolved 
Sea Sparrow Missile, Joint Precision Approach and Landing System, Multi-
Function Radar, Volume Search Radar, and the Advance Weapons 
Information Management System/Aviation Data Management and Control 
System. This last technology was redefined after development start. In 
the case of four technologies the program has mature alternate systems 
as backup technologies. Program officials stated that no backup is 
feasible for either Volume Search Radar or Multi-Function Radar without 
major ship redesign. 

Two technologies modified since development start are also not mature. 
The Shipboard Weapons Loader is a self-propelled unit to decrease the 
time required to load weapons onto aircraft. The other technology is 
Smart Stores, which is a software-based system to automate CVN-21's 
inventory and material asset management capabilities. The Navy's 
primary risks identified for this technology center on successful 
integration with planned ship systems. The Navy has identified backup 
technologies for each of these technologies. 

Only one critical technology, the 1,100-ton air conditioning plants, is 
not planned to be near maturity by construction start. Program 
officials believe the plants will reach mature levels shortly after the 
start of construction. Risks associated with the plants are considered 
low by officials since the technology being used is derived from 
commercial applications and enhancements leveraging experience from 
plants found on other US Navy ships. 

Design Stability: 

The CVN-21 program is currently planning a design review date for March 
2007. Rather than measuring design stability by percentage of 
engineering drawings completed, the program uses an alternative metric 
that measures earned hours completed in product model development. As a 
result we could not assess the ship's design stability. 

Other Program Issues: 

The program has delayed delivery of both the first and second ship by 
adding one year to the development schedule. According to program 
officials, the Navy made this decision with the intent to balance ship 
construction dollars in the President's fiscal year 2006 budget. 
Research and development funds were added to the program to bridge the 
additional year, which allows additional time and funding to mature 
technologies in the program. The one year shift does create an 
additional gap, where the Navy will have to operate with only 11 
carriers, between de-commissioning of the USS Enterprise aircraft 
carrier and delivery of the first CVN-21 to the fleet. 

Agency Comments: 

In commenting on a draft of this assessment, the Navy emphasized that, 
based on product model development progress, the CVN-21 program's 
overall design was 44 percent complete as of November 2005 and that the 
program is on schedule to support the construction of the lead ship. In 
addition, the department said that although there was a one year slip 
based on decisions to balance ship construction in the President's 
fiscal year 2006 budget, technology development efforts were unaffected 
and remain on track. 

[End of section] 

DD(X) Destroyer: 

The Navy's DD(X) destroyer is a multimission surface ship designed to 
provide advanced land attack capability in support of forces ashore and 
contribute to U.S. military dominance in littoral operations. The 
program recently completed the system design phase and was authorized 
to begin detail design and construction of the lead ships in November 
2005. The program will continue to mature its technologies and design 
as it approaches construction. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: BAE Systems, Bath Iron Works, Northrop Grumman Ship 
Systems, Raytheon; 
Program office: Washington, D.C. 

Funding needed to complete: 
R&D: $3,241.7 million; 
Procurement: $0.0 million; 
Total funding: $3,241.7 million; 
Procurement quantity: 0. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

Costs increased due to changes in cost estimating, additional 
technology development, and a program restructuring. 

Since last year's assessment, the program completed demonstrations of a 
number of its 12 critical technologies. One of the technologies was 
fully mature by the November 2005 production decision. Eight 
technologies were demonstrated in a relevant environment and are near 
full maturity. Some of these technologies will not be fully mature 
until after installation on the first ship as testing in an operational 
environment is not considered feasible. The integrated deckhouse, ship 
computing system, and volume search radar are at lower levels of 
maturity, having completed component level demonstrations. The Navy 
approved the system design to proceed into the next phase, but a number 
of risks remain in both design and technology that could lead to 
changes. 

[See PDF for image] 

[End of figure] 

DD(X) Program: 

Technology Maturity: 

At the November 2005 production decision, one of 12 critical 
technologies for DD(X) was fully mature. While completion of tests in 
2005 advanced the maturity of technologies, development continues as 
the program proceeds with detail design. Eight technologies, the 
advanced gun system and its projectile, autonomic fire suppression, 
hull form, infrared suppression, integrated power system, multifunction 
radar, and peripheral vertical launch system are short of full maturity 
but have been demonstrated in a relevant environment. Program officials 
state that the undersea warfare system is fully mature, based on the 
use of mature components. However, the components will not be 
integrated and tested together until after ship installation. Due to 
practical limitations some of these technologies, the advanced gun 
system and its projectile, hull form, and infrared suppression, will 
not be fully demonstrated until after installation on the lead ship. 

The integrated deckhouse, volume search radar, and ship computing 
system are at lower levels of maturity. The program tested a physical 
model of the deckhouse for stealth requirements and placement of 
apertures to minimize interference, but with only a portion of the 
apertures expected. Analysis of deckhouse resilience to fire and shock 
has been completed, and will be tested during detail design. The volume 
search radar will require additional development to increase 
performance, which may aggravate an already aggressive schedule. 
Software development has been progressing as planned, although about 
three-quarters of the effort remains. 

Design Stability: 

The metric for design maturity used in other programs does not apply to 
DD(X), and therefore the program was not assessed according to this 
metric. Instead the program assesses design stability by reviewing 
design artifacts, which include items like system drawings, ship 
specifications, and major equipment lists. The program office states 
that all 2010 design artifacts are complete, though some may be altered 
as systems continue to mature or are changed to meet cost reduction 
goals. 

On September 14, 2005 the Navy completed the critical design review of 
DD(X) and approved the start of detail design. Risk remains in the 
system design due to issues in the power system, deckhouse, and hull 
form. The concern with the power system is ensuring the design meets 
limits on space and weight. As this system is needed early in 
construction, it could have an impact on schedule if not resolved 
quickly. A number of systems in the deckhouse, including the volume 
search radar and electronic warfare system, are still in development 
and design of the deckhouse could be affected if they exceed margins 
for weight and space. Furthermore, due to the hull form's unique 
design, it has reduced stability in very severe weather conditions. 
Program officials state they can reduce this risk through guidance that 
helps the crew avoid these conditions. Model testing for heavy sea 
conditions also revealed some areas which may require strengthened 
structure, and program officials believe this can be corrected. 

Agency Comments: 

The Navy stated that the design, development and testing of critical 
technologies mitigated the significant technical risks prior to 
critical design review. The DD(X) ship design remained stable 
throughout critical technology testing, successfully incorporating all 
necessary component modifications and entering detail design with 
adequate weight margin. A comprehensive test program will address all 
remaining risk areas described in the report. 

The Navy further noted that given the unique nature of shipbuilding, 
with detail design and construction spread over 5 years, comparing 
DD(X) technology readiness levels to the GAO-developed best practices 
is not valid. DD(X) technology readiness levels met current acquisition 
policy guidance in support of the decision to proceed into system 
development in November 2005. 

GAO Response: 

Our approach is valid because our work has shown that technological 
unknowns discovered late in development lead to cost increases and 
schedule delays. Some of the technologies still under development for 
DD(X) could have major impact on ship design and construction 
schedules. 

[End of section] 

E-2D Advanced Hawkeye (E-2D AHE): 

The Navy's E-2D AHE is an all-weather, twin engine, carrier-based, 
aircraft designed to extend early warning surveillance capabilities. It 
is the next in a series of upgrades the Navy has made to the E-2C 
Hawkeye platform since its first flight in 1971. The E-2D AHE is 
designed to improve battle space target detection and situational 
awareness, especially in littoral areas; support Theater Air and 
Missile Defense operations; and improve operational availability. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Northrop-Grumman Corp. 

Program office: Patuxent River, Md. 

Funding needed to complete: 
R&D: $2,464.8 million; 
Procurement: $9,695.1 million; 
Total funding: $12,159.9 million; 
Procurement quantity: 69. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

The E-2D AHE program entered system development in June 2003 without 
demonstrating that its four critical technologies had reached full 
maturity. Since that time, one of the program's four critical 
technologies has reached full maturity. The program expects the 
remaining three critical technologies to mature before the production 
decision in March 2009. While more mature backup technologies exist for 
the three critical technologies, use of the backup technologies would 
result in degraded system performance or reduced ability to accommodate 
future system growth. The design met best practice standards at the 
time of design review in October 2005. However, until all the 
technologies are mature, the potential for design changes remains. We 
could not assess production maturity because the program does not plan 
to use statistical process controls. 

[See PDF for image] 

[End of figure] 

E-2D AHE Program: 

Technology Maturity: 

One of the E-2D AHE's four critical technologies (the space time 
adaptive processing algorithms and associated processor) is mature. The 
program expects the remaining technologies (the rotodome antenna, a 
silicon carbide-based transistor for the power amplifier to support UHF 
radio operations, and the multichannel rotary coupler for the antenna) 
to be fully mature before the start of production in March 2009. 

More mature backup technologies exist for the three technologies (the 
rotodome antenna, the silicon carbide-based transistor, and the 
multichannel rotary coupler) and were flown on a larger test platform 
in 2002 and 2003. However, use of the backup technologies would result 
in degraded system performance or reduced ability to accommodate future 
system growth due to size and weight constraints. The next AHE 
technology readiness assessment is to be performed prior to the 
production decision in fiscal year 2009, and the program office 
anticipates that the critical technologies will be mature at that time. 

Design Stability: 

The program had completed 90 percent of its engineering drawings at the 
Critical Design Review, which was completed on October 21, 2005. 
Program officials project that they will have 100 percent completed by 
the planned start of production in March 2009. However, the technology 
maturation process may lead to more design changes. 

Production Maturity: 

The program expects a low-rate production decision in March 2009, but 
does not require the contractor to use statistical process controls to 
ensure its critical processes are producing high quality and reliable 
products. According to the program, the contractor assembles the 
components using manual, not automated, processes that are not 
conducive to statistical process control. The program relies on post- 
production data, such as defects per unit, to track variances and non- 
conformance. The program also conducts production assessment reviews 
every 6 months to assess the contractor's readiness for production. The 
program has updated the manufacturing processes that were established 
and used for the E-2C over the past 30 years. The program considers the 
single station joining tool; the installation of electrical, hydraulic 
and pneumatic lines; and the installation of the prime mission 
equipment all critical manufacturing processes. 

The program is currently building the first two development aircraft. 
According to the program office, there are no significant differences 
in the manufacturing processes for the development aircraft and the 
production aircraft. 

Agency Comments: 

In commenting on a draft of this assessment, the Navy stated that the E-
2D AHE program successfully executed all component and subsystem design 
reviews, culminating in the successful completion of the weapon system 
design review in October 2005. This review included a thorough 
evaluation of the four critical technologies and all program risks. 
According to the Navy, critical technologies do not represent a high 
risk to the AHE program at present. 

Flight testing, which will include the four critical technologies, is 
planned to begin in the fourth quarter of fiscal year 2007. The test 
program expects to demonstrate the design maturity of all technologies 
and capabilities at that time. A Technology Readiness Assessment will 
be conducted prior to the low rate production decision. 

According to the Navy, integration of statistical process controls 
would require significant investment to update the E-2D aircraft 
manufacturing process. The Navy has elected not to make this investment 
due to the maturity and over 30 years of E-2 production. 

[End of section] 

Evolved Expendable Launch Vehicle (EELV) - Atlas V, Delta IV: 

The Air Force's EELV program acquires commercial satellite launch 
services from two competitive families of launch vehicles--Atlas V and 
Delta IV. Initiated as an industry partnership, the program's goal is 
to support and sustain assured access to space and reduce the life- 
cycle cost of space launches by at least 25 percent over previous 
systems while meeting the government's launch requirements. A number of 
variants are available depending on the lift capability necessary for 
each mission. We assessed both the Atlas V and Delta IV. 

[See PDF for image] 

[End of figure] 

Program Essentials: 

Prime contractor: Boeing Launch Services, Lockheed Martin Space 
Systems; 
Program office: El Segundo, Calif. 

Funding needed to complete: 
R&D: $43.4 million; 
Procurement: $23,282.7 million; 
Total funding: $23,326.2 million; 
Procurement quantity: 118. 

Program Performance (fiscal year 2006 dollars in millions): 

[See PDF for image] 

[End of table] 

While the EELV program office has access to technology, design, and 
production maturity information, it does not collect this information 
because it is buying the launch service. To date, eleven successful 
launches have occurred--three government and eight commercial. A 
technical review was completed, and the program is implementing 
corrective actions to eliminate the cau