By Marina Malenic
Northrop Grumman [NOC], the prime contractor for the Air Force’s RQ-4 Global Hawk reconnaissance drone program, is studying ways to lower the price of the aircraft in the wake of Pentagon efforts to reduce overhead in the department as a whole.
“I think we’ve got a good understanding of…where some of the cost growth in the program is,” George Guerra, vice president and program manager for Northrop Grumman’s High Altitude, Long Endurance programs, said yesterday.
Guerra said the company has come up with a list of over 100 possible areas for savings.
“We’ve been working with our supplier team, and we have a great list of ideas,” he added. “That is one of the key focuses in today’s environment, to try to figure out how we can drive costs down.”
Guerra was speaking at a briefing at the National Press Club in Washington.
The Pentagon’s top arms buyer, Ashton Carter, has said that Global Hawk is “on a path to being unaffordable” and is being studied in detail to determine what is causing the suspected inefficiencies (Defense Daily, June 28). Air Force acquisition executive David Van Buren has said that he is “not happy” with the pace and cost of the program, both on the government and the contractor side (Defense Daily, June 21).
As a result, a “should-cost” review is underway, as directed by Carter’s office. The Air Force-led study is intended to look at both the air vehicle cost, as well as the cost of each sensor package.
The Pentagon’s heightened awareness on such matters stems from Defense Secretary Robert Gates’ plan to reduce overhead in an effort to help avoid future defense budget cuts.
Guerra said his company is supporting that effort and is looking beyond just the production piece of the program to find savings.
“People tend think of the production side of a program,” he said. “We are looking at that, but we’re also looking at the sustainment effort.”
“We’re looking at that with the Air Force and continuing to identify ways to save money,” he added.