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Highlights

The F-35 Lightning II, also known as the Joint Strike Fighter (JSF), is the Department of Defense's (DOD) most costly and ambitious aircraft acquisition, seeking to simultaneously develop and field three aircraft variants for the Air Force, Navy, Marine Corps, and eight international partners. The JSF is critical for recapitalizing tactical air forces and will require a long-term commitment to very large annual funding outlays. The current estimated investment is $382 billion to develop and procure 2,457 aircraft. This report, prepared in response to a congressional mandate in the National Defense Authorization Act for Fiscal Year 2010, discusses (1) program cost and schedule changes and their implications on affordability; (2) progress made during 2010; (3) design and manufacturing maturity; and (4) test plans and progress. GAO's work included analyses of a wide range of program documents and interviews with defense and contractor officials.

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Defense Given the other priorities that DOD must address in a finite budget, a renewed and sustained focus on affordability by contractors and the Government is critical for successfully moving the program forward. DOD must plan ahead for a way to address and manage JSF challenges and risks in the future. To facilitiate making tradeoff decisions with respect to the JSF program that limit impacts to other DOD programs and priorities and to improve key management processes, the Secretary of Defense should do the following to reinforce and strenghthen program cost controls and oversight. The JSF program should maintain total annual funding levels for development and procurement at the current budgeted amounts in the fiscal year 2012-2016 future years defense plan (modified, if warranted, by the new acquisition program baseline expected this year). It should facilitate trades among cost, schedule, requirements, and quantities to control cost growth. Having gone through the Technical Baseline Review (TBR) and budget approval process, it is reasonable to expect the program to execute against the future years defense plan going forward. Only in instances of major and unforseen circumstances, should the Department consider spending more money on the program. Even then, we would expect changes to be few and adopted only after close scrutiny by defense leadership. Approved changes should be well supported, adequately documented, and reported to the congressional defense committees.
Closed - Implemented

Recommendation status is Closed - Implemented.

The program established its new acquisition program baseline in March 2012. The program has largely managed cost overruns by reducing planned procurement funds. This has resulted in an overall reduction to the FY12-FY16 future years defense plan forecast contained in the FY14 budget submission in comparison to the FY12 budget submission, which was in place at the time of report issue.
Department of Defense Given the other priorities that DOD must address in a finite budget, a renewed and sustained focus on affordability by contractors and the Government is critical for successfully moving the JSF program forward. DOD must plan ahead for a way to address and manage JSF challenges and risks in the future. To facilitate making tradeoff decisions with respect to the JSF program that limit impacts to other DOD programs and priorities and to improve key management processes, the Secretary of Defense should do the following to reinforce and strengthen program cost controls and oversight. The Secretary of Defense should establish criteria for the STOVL probation period and take additional steps to sustain individual attention on STOVL-specific issues, including independent F-35B/STOVL Progress Reviews with Senior Leadership to ensure cost and schedule milestones are achieved to deliver required warfighter capabilities. The intent is to allow each JSF variant to proceed and demonstrate success at its own pace and could result in separate full-rate production decisions.
Closed - Not Implemented

Recommendation status is Closed - Not Implemented.

In January 2012, the new Secretary of Defense lifted the STOVL probation after 1 year, citing improved performance and completion of initial sea trials as a basis for the decision. In its report to Congress, the Department explained that STOVL progress was continually monitored throughout the probation period with specific exit criteria. The report also stated that the Commandant of the Marine Corps completed monthly reviews of STOVL progress in additional to the monthly Service Acquisition Executive reviews of the program.
Department of Defense Given the other priorities that DOD must address in a finite budget, a renewed and sustained focus on affordability by contractors and the Government is critical for successfully moving the JSF program forward. DOD must plan ahead for a way to address and manage JSF challenges and risks in the future. To facilitate making tradeoff decisions with respect to the JSF program that limit impacts to other DOD programs and priorities and to improve key management processes, the Secretary of Defense should do the following to reinforce and strengthen program cost controls and oversight. The Department should conduct an independent review of the contractor's software development, integration, and test processes--similar to its review of manufacturing operations--and look for opportunities to streamline software efforts. This review should include an evaluation of the ground lab and simulation model accreditation process to ensure it is properly structured and robustly resourced to support software test and verification requirements.
Closed - Implemented

Recommendation status is Closed - Implemented.

Our report recommended that the Department conduct an independent review of the contractor's software development, integration, and test processes -- similar to its review manufacturing operations -- and look for opportunities to streamline software efforts. We suggested that this review include an evaluation of the ground lab and simulation model accreditation process to ensure that it is properly structured and robustly resourced to support software test and verification requirements. DOD concurred with our recommendation and the initial independent software assessment began in September 2011 and ongoing reviews are planned through 2012.

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