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Guffey PROJECT AIR FORCE Do Joint Fighter Programs Save Money? Mark A. Lorell, Michael Kennedy, Robert S. Leonard, Ken Munson, Shmuel Abramzon, David L. An, Robert A. Guffey Prepared for the United States Air Force Approved for public release; distribution unlimited The research described in this report was sponsored by the United States Air Force under Contract FA7014-06-C-0001. Further information may be obtained from the Strategic Planning Division, Directorate of Plans, Hq USAF. Library of Congress Cataloging-in-Publication Data is available for this publication. ISBN: 978-0-8330-7456-0 The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND’s publications do not necessarily reflect the opinions of its research clients and sponsors. Support RAND—make a tax-deductible charitable contribution at www.rand.org/giving/contribute.html R ® is a registered trademark Cover image courtesy of iStockphoto. © Copyright 2013 RAND Corporation This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of RAND documents to a non-RAND website is prohibited. RAND documents are protected under copyright law. Permission is given to duplicate this document for personal use only, as long as it is unaltered and complete. Permission is required from RAND to reproduce, or reuse in another form, any of our research documents for commercial use. For information on reprint and linking permissions, please see the RAND permissions page (www.rand.org/pubs/permissions.html). RAND OFFICES SANTA MONICA, CA • WASHINGTON, DC PITTSBURGH, PA • NEW ORLEANS, LA • JACKSON, MS • BOSTON, MA DOHA, QA • CAMBRIDGE, UK • BRUSSELS, BE www.rand.org Preface In the past 50 years, the U.S. Department of Defense (DoD) has pur- sued numerous joint aircraft programs, the largest and most recent of which is the F-35 Joint Strike Fighter (JSF). Joint aircraft programs, in which two or more services participate in the development, pro- curement, and sustainment of a single aircraft design, are thought to save significant Life Cycle Cost (LCC) by eliminating duplicate efforts and realizing economies of scale. But the need to accommodate different service requirements in a single design or common design family leads to greater program complexity, increased technical risk, and common functionality or increased weight beyond that needed for some variants, potentially leading to higher overall cost, despite the efficiencies. The fundamental question we seek to answer is how much savings accrue, on average, from joint aircraft programs and are they sufficient to offset the addi- tional costs arising from greater complexity? In short, do joint fighter and other aircraft programs cost less overall throughout their entire life cycles than an equivalent set of specialized, single-service systems? To help Air Force leaders (and acquisition decisionmakers in gen- eral) select an appropriate acquisition strategy for future combat air- craft, Gen Donald Hoffman, as former commander of Air Force Mate- riel Command (AFMC), asked RAND Project AIR FORCE to analyze the costs and savings of joint tactical aviation acquisition programs. The study team examined whether historical joint aircraft programs, and JSF in particular, have saved LCC compared with comparable single- service programs. Also examined were the implications of joint fighter iii iv Do Joint Fighter Programs Save Money? programs for the health of the industrial base and for operational and strategic risk. Greater detail on the methodologies and approaches used in the analysis reported in this document has been published in a sepa- rate document.1 Our analysis shows that historical joint aircraft programs have not saved overall LCC versus single-service aircraft programs and that JSF is currently not on the path to saving LCC versus comparable notional single-service fighter programs. The objective of this research was to inform the formulation of acquisition strategies and program structures for future fighter and other aircraft major defense acquisi- tion programs. These findings do not, therefore, directly address policy questions regarding the current or future status of JSF. However, they can provide insight into how and why JSF has arrived at its current status with respect to cost and cost growth, and they could contribute to broader analysis seeking to develop policy options for the way ahead for the JSF program. The research reported here was sponsored by Gen Donald Hoffman, former Commander of Air Force Materiel Command, and conducted within the Resource Management Program of RAND Proj- ect AIR FORCE as part of the “Cost/Benefit Analysis of Joint Tactical Aviation Acquisition Programs” project. This document should be of interest to the senior defense acquisi- tion and cost analysis policy communities. RAND Project AIR FORCE RAND Project AIR FORCE (PAF), a division of the RAND Corpo- ration, is the U.S. Air Force’s federally funded research and develop- ment center for studies and analyses. PAF provides the Air Force with independent analyses of policy alternatives affecting the development, employment, combat readiness, and support of current and future air, 1 See Mark A. Lorell, Michael Kennedy, Robert S. Leonard, Ken Munson, Shmuel Abramzon, David L. An, and Robert A. Guffey, Do Joint Fighter Programs Save Money? Technical Appendixes on Methodology, Santa Monica, Calif.: RAND Corporation, MG- 1225/1-AF, 2013. Preface v space, and cyber forces. Research is conducted in four programs: Force Modernization and Employment; Manpower, Personnel, and Train- ing; Resource Management; and Strategy and Doctrine. Additional information about PAF is available on our website: http://www.rand.org/paf/