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As of April 7, 2020, there are 4984 open recommendations, of which 369 are priority recommendations. Recommendations remain open until they are designated as Closed-implemented or Closed-not implemented.
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Recommendation: To improve the use of warranties and guarantees in Navy shipbuilding, the Secretary of the Defense should direct the Secretary of the Navy, for future ship construction contracts, to determine whether or not a warranty as provided in the FAR, provides value and document the costs, benefits, and other factors used to make this decision. To inform this determination, the Navy should begin differentiating the government's and shipbuilder's responsibility for defects and track the costs to correct all defects after ship delivery.
Agency: Department of Defense Status: Open Priority recommendation
Comments: DOD partially concurred with this recommendation in February 2016 by committing to study policy changes with regard to warranties, but disagreed that additional cost data were needed to inform these decisions, and questioned whether warranties are suitable for ship acquisitions. In February 2017, a Navy-funded study found that the Navy had no policy to collect data, and that the little data available were not useful for determining when warranties are suitable. In response to the study, the Navy agreed that, by December 2017, it would make some policy and contractual changes to collect data, but it continued to maintain that warranties are likely not suitable for ship contracts. In January 2018, the Navy issued guidance to help contracting officers determine when and how to use a warranty or guarantee, but the Navy has collected only one warranty cost proposal from one shipbuilder for a contract for a single ship and, going forward, Navy officials stated that they do not have plans to systematically collect such data. In August 2019, we recommended in GAO-19-512 that the Navy collect warranty pricing on its new class of frigates, as the Navy initially did not include warranty pricing as part of its request for proposals for the ship class. To fully implement this recommendation, the Navy needs to collect additional data in order to determine cases in which warranties could contribute to improvements in the cost and quality of Navy ships.