The December 2013 Pentagon Selected Acquisition Reports summary is now public, and budget pressures have taken their toll on a variety of defense programs, while the services seek to control costs on others. The SAR reports give an important peek at the Pentagon’s own insights into the performance of its programs. In this report, we take a look at how certain Air Force programs have fared.
— If sequestration does indeed re-open the KC-46 contract as feared and cause costs to rise, it would be a shame for the Air Force, which has managed to trim the cost of the program by 4.2 percent. That kind of reduction in a program of that size translates to $2.2 billion in savings, according to the SAR summary. The Pentagon attributed the bulk of the savings to lower construction estimates based on site surveys of initial bases ($715.4 million) and funding reductions due to a stable program and no engineering change proposals ($655.6 million). It should be noted, however, that $142.9 million of the reduction came from sequestration itself. Read more KC-46 analysis >>>
MQ-9 Reaper — The Reaper is on its way out, as far as the Air Force is concerned, as the service decided this year it wants to end buys of the unmanned aircraft in 2017. The SAR summary details just how much the Air Force expects to save by closing out MQ-9 buys, and it’s substantial: $1.45 billion total, with total costs dropping from $13.3 billion to $11.9 billion. About $962 million of that reduction comes from slashing 58 aircraft from the program, and an additional $433 million comes from reducing the initial spares and support that would come with those aircraft. Read more MQ-9 analysis >>>
Space Based Infrared System (SBIRS) — The SBIRS program has struggled with cost overruns in the past, with the Government Accountability Office in 2012 writing that the Air Force was anticipating a $438 million cost overrun and a delay of one year for the third and fourth satellites. However, for the fifth and sixth satellites, the Pentagon is actually reporting a $461 million decrease (about 12 percent) “due primarily to a reduced estimate to reflect a fixed price contract proposal” for those two satellites. The remaining $118.5 million reduction came from sequestration. Read more SBIRS analysis >>>
Joint Direct Attack Munition — Sequestration may be poised to take a bite out of JDAM over the next few years — as we noted last week — but the program in general is on the rise, according to the SAR summary. Total program costs have taken a 12.2 percent jump, or $788 million, but that’s because the Air Force has boosted the purchase of tailkits by 30,758, from 181,830 to 212,588. That means even if sequestration were to take effect, JDAM buys would be growing, not shrinking. Read more JDAM analysis >>>