Defense Depot Maintenance: Weaknesses in the T406 Engine Logistics Support Decision Methodology
NSIAD-98-221
Published: Sep 14, 1998. Publicly Released: Sep 14, 1998.
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Highlights
Pursuant to a congressional request, GAO provided information on the logistics support of the V-22 aircraft's T406 engine, focusing on: (1) the criteria used in determining that the T406 engine is a commercial item for purposes of exemption from establishing in-house maintenance capabilities for new systems identified by the Secretary of Defense under 10 U.S.C. 2464; (2) the rationale and support for the decision to designate the T406 a commercial item; and (3) the extent to which the cost-effectiveness of the decision was evaluated.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | The Secretary of Defense should issue guidance requiring the services to document in the contract file support for their commercial item determinations under 10 U.S.C. 2464 and subsequent logistics support decisions. On the basis of GAO's review of the T406 case, example of items that might be considered for documentation include: (1) percentage of common parts; (2) a comparative value of the average sales price of the baseline commercial item with the estimated price of the item that is the subject of the determination; (3) the value of unique support and test equipment and tools required to support the military requirement; and (4) a cost evaluation documenting that the life-cycle logistics support in the private sector is expected to result in a lower cost to the government. |
Closed – Implemented
The Navy disagreed with the recommendation. It stated that such a requirement would impose a stricter definition and criteria for commercial items subject to depot repair than required by the legislative exemption for commercial items with minor modifications. However, on March 24, 1999, the Department of Defense directed the services to document analysis in the contract file supporting its commercial item determinations under 10 U.S.C. 2464.
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| Department of Defense | The Secretary of Defense should require the Secretary of the Navy to complete a new and updated cost analysis, correcting previous errors and inconsistencies, before executing future option years under the current T406 contract. |
Closed – Implemented
The Department agreed with the recommendation and directed the Navy to update the cost analysis as recommended. On December 11, 1998, the Navy provided its updated cost analysis to OSD.
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Topics
Aircraft enginesAircraft maintenanceCost effectiveness analysisDecision makingDefense cost controlDepartment of Defense contractorsLogisticsMilitary aircraftPrivatizationSpare parts