Aircraft Development:

Reasons for Recent Cost Growth in the Advanced Tactical Fighter Program

NSIAD-91-138: Published: Feb 1, 1991. Publicly Released: Feb 1, 1991.

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Pursuant to a congressional request, GAO reviewed key factors that contributed to the $24.2-billion increase in the total estimated cost for the Air Force's advanced tactical fighter (ATF) program.

GAO held that: (1) inflation accounted for approximately $16 billion, or 66 percent, of the increase; (2) such program costs as the addition of two-seat aircraft to the development and production programs, increased aircraft weight, and updated prices for the selected avionics suite accounted for $2.6 billion of the increase; (3) changes in estimates for adjustments in labor rates and material costs accounted for $1.3 billion of the increase; and (4) such schedule changes as the reduction of the peak annual production rate and a longer development period accounted for $4.3 billion of the increase. In addition, GAO found that additional factors expected to affect cost included: (1) reductions in the Air Force's fighter force, which could reduce the number of ATF to be acquired; (2) better cost estimates for full-scale development of the aircraft due to the contractor's January 1991 cost proposals; (3) a potential slip in the start of full-scale development currently planned for July 1991; and (4) updated Department of Defense inflation indexes.

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