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F-35 Joint Strike Fighter (JSF) Program

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Order Code RL30563 F-35 Lightning IIF-35 Joint Strike Fighter (JSF) Program: Background, Status, and Issues Updated August 29, 2008 Christopher Bolkcom Specialist in National Defense Foreign Affairs, Defense, and Trade Division Anthony Murch U.S. Air Force Fellow Foreign Affairs, Defense, and Trade Division F-35 Lightning II Joint Strike Fighter (JSF) Program: Background, Status, and Issues Summary The Defense Department’s F-35 Lightning II Joint Strike Fighter (JSF) is one of three aircraft modernization programs in tactical aviation, the others being the Air Force F-22A fighter and the Navy F/A-18E/F fighter/attack plane. In November 1996, the Defense Department selected two major aerospace companies, Boeing and Lockheed Martin, to demonstrate competing designs for the JSF, a joint-service and multi-role fighter/attack plane. Lockheed Martin won this competition and was selected to develop and produce the JSF, a family of aircraft including conventional take-off and landing (CTOL), carrier-capable (CV), and short take-off vertical landing (STOVL) versions for the U.S. Air Force, Navy, and Marine Corps, the United Kingdom, as well as other allied services. Originally designated the Joint Advanced Strike Technology (JAST) program, the JSF program has attracted considerable attention in Congress because of concerns about its cost, effects on the defense industrial base, and implications for U.S. national security in the 21st century. The JAST/JSF program is designed to address the high cost of tactical aviation, the need to deploy fewer types of aircraft to reduce acquisition and operating costs, and projections of future threat scenarios and enemy capabilities. The program’s rationale and primary emphasis is joint-service development of a next-generation multi-role strike aircraft that can be produced in affordable variants to meet different operational requirements. Developing an affordable tri-service family of aircraft with different (but similar) combat missions poses major technological challenges. If the JSF is to have joint-service support, the program must yield affordable aircraft that can meet such divergent needs as those of the U.S. Air Force for a successor to its low-cost F-16 and A-10 fighter/attack planes, those of the U.S. Marine Corps and the UK Royal Air Force and Navy for a successor to their Harrier STOVL aircraft, and the U.S. Navy’s need for a successor to older F/A-18s and a complement to its F/A-18E/F fighter/attack planes. This report discusses the background, status, and current issues of the JSF program. Additional information and analysis can be found in CRS Report RL33543, Tactical Aircraft Modernization: Issues for Congress, which also discusses the Air Force F-22A, the Navy F/A-18EF, and the Marine Corps V-22. The JSF program is also addressed in CRS Report RL33390, Proposed Termination of Joint Strike Fighter (JSF) F136 Alternate Engine; CRS Report RS21488, NavyMarine Corps Tactical Air Integration Plan: Background and Issues for Congress; and CRS Report RL31360, Joint Strike Fighter (JSF): Potential National Security Questions Pertaining to a Single Production Line. This report will be updated as events warrant. Contents Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Design and Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Program Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Funding and Projected Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Development and Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Production Quantities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Potential F-35 Bases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Allied Participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Current Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Concurrency of Testing and Production . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Mid-Course Risk Reduction Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Affordability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Projected Fighter Aircraft Inventory Shortfalls . . . . . . . . . . . . . . . . . . . . . 15 Implications for U.S. Defense Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Congressional Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Appendix A. JSF Key Performance Parameters . . . . . . . . . . . . . . . . . . . . . . . . . 23 Appendix B. JSF Procurement Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 List of Figures Figure 1. F-35 Lightning II Joint Strike Fighter . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Figure 2. Defense Acquisition Management Framework . . . . . . . . . . . . . . . . . . . 7 List of Tables Table 1. JSF F-35 FY2009 Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Table 2. JSF F-35 FY2008 Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Table 3. JSF F-35 FY2007 Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Table 4. JSF F-35 FY2006 Funding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 F-35 Lightning II Joint Strike Fighter (JSF) Program: Background, Status, and Issues Introduction The F-35 Lightning II, Joint Strike Fighter (JSF) program is developing and building a family of next-generation tactical aircraft for the Air Force, the Marine Corps, and the Navy, as well as for export.1 As now projected, the JSF is the Defense Department’s (DOD’s) largest acquisition program in terms of cost and number of aircraft to be produced and the longest in terms of procurement duration. Current DOD plans call for production of 2,456 aircraft in three versions over a 28-year delivery period.2 The U.S. Air Force’s program of record is to purchase 1,763 conventional takeoff and landing (CTOL) versions of the F-35 to replace its current force of F-16 Falcons and A-10 Warthogs. In February 2003, Air Force officials announced its intentions to analyze acquisition of the STOVL JSF to improve future close air support (CAS) capabilities.3 To date, however, the Air Force has not committed to purchasing other variants besides its CTOL platform. While speculation continues as to the procurement intentions of the USAF (the largest purchaser of the F-35), the Air Force official position still remains at 1,763 CTOL F-35s.4 The Department of the Navy (composed of the Navy and the Marine Corps) plans to procure of 680 JSFs. The Marine Corps plans to field the short take-off vertical landing (STOVL) version of the plane to replace its current fleet of AV-8B Harrier vertical/short take-off and landing (VSTOL) attack planes.5 The Navy plans to procure a carrier-capable version — termed a CV — to replace older carrier-based 1 Unlike the F-22A Raptor, the F-35 was designed for export from the onset and will be the first U.S. export of a stealth aircraft. 2 Fifteen of these aircraft will be purchased with RDT&E funds and will be used for developmental testing. 3 Lorenzo Cortes, “Air Force to Study Acquisition of F-35-B STOVL JSF,” Defense Daily, February 13, 2004; Gail Kaufman, “U.S. Air Force Wants STOVL JSFs,” Defense News, February 12, 2004; and Christopher Castelli, “Overall Impact of Air Force Interest in F-35 STOVL Variant is Unclear,” Inside the Navy, March 1, 2004. 4 Marc Selinger, “Jumper Confirms Air Force Plans to Cut Joint Strike Fighter Purchase,” Aerospace Daily & Defense Report, December 15, 2004. 5 The U.S. Marine Corps and the UK Royal Navy and Royal Air Force operate versions of the AV-8A/B Harrier aircraft flown by these services since the early 1970s. CRS Report 81-180, The British Harrier V/STOL Aircraft: Analysis of Operational Experience and Relevance to U.S. Tactical Aviation (out of print; available from the author at 7-2577). CRS-2 aircraft. The exact division of the Department’s 680 F-35s between the two variants and the two services has not yet been determined. An additional 738 aircraft are expected to be ordered by the JSF development partner nations of the UK, Australia, Italy, Canada, Denmark, Turkey, the Netherlands, and Norway.6 The United Kingdom is anticipated to be the largest foreign purchaser of the F-35, with a projected 138 STOVL aircraft. Figure 1. F-35 Lightning II Joint Strike Fighter Background The JSF program emerged in late 1995 from the Joint Advanced Strike Technology (JAST) program, which began in late 1993 as a result of the Administration’s Bottom-Up Review (BUR) of U.S. defense policy and programs. Having affirmed plans to abandon development of both the A-12/AFX aircraft that was to replace the Navy’s A-6 attack planes and the multi-role fighter (MRF) that the Air Force had considered to replace its F-16s, the BUR envisaged the JAST program as a replacement for both these programs. In 1995, in response to congressional direction, a program led by the Defense Advanced Research Projects Agency (DARPA) to develop an advanced short takeoff and vertical landing (ASTOVL) 6 Current anticipated partner orders: UK: 138; Italy: 131; Australia: 100; Turkey: 100; Canada: 88; Netherlands: 85; Denmark: 48; Norway: 48. Michael Sirak, “F-35 Nations on Track to Sign New MOU, Says JSF Program Office,” Defense Daily, November 20, 2006. CRS-3 aircraft was incorporated into the JAST program. This opened the way for Marine Corps and British Navy participation.7 The name of the program was then changed to Joint Strike Fighter to focus on joint development and production of a nextgeneration fighter/attack plane. And unlike the so-called “joint” Air Force/Navy TFX program of the 1960s, program proponents note the JAST/JSF program has been truly “joint” from its inception. During the JAST/JSF program’s 1994-1996 concept development phase, three different aircraft designs were proposed by Boeing, Lockheed Martin, and McDonnell Douglas (the latter teamed with Northrop Grumman and British Aerospace) in a competitive program expected to shape the future of U.S. tactical aviation and the U.S. defense industrial base.8 On November 16, 1996, the Defense Department announced that Boeing and Lockheed Martin had been chosen to compete in the 1997-2001 concept demonstration phase, in which each contractor would build and flight-test two aircraft to demonstrate their concepts for three JSF variants (conventional takeoff/landing, short-field takeoff/vertical landing, and the carrier takeoff/landing). On October 26, 2001, DOD selected a team of contractors led by Lockheed Martin to develop and produce the JSF. The three variants — CTOL, CV and STOVL aircraft — are to have maximum commonality in airframe, engine, and avionics components to reduce development, production, and operation and support costs. Mainly because of their projected costs, three tactical aircraft programs are being analyzed by both Congress and the Administration to determine the best combination of the types and numbers of aircraft to meet the future needs of the military — the emergent JSF program, the Air Force F-22A program, and the Navy’s F/A-18E/F program. Congressional decisions on these programs will have important implications for defense funding requirements, U.S. military capabilities, and the U.S. aerospace industry. Design and Performance Contrary to some misconceptions that the Joint Strike Fighter would be one aircraft used by several services for different missions, the program focused on the development and production of three variants with common components: a landbased conventional take-off and landing (CTOL) version for the Air Force, a carrierbased version (CV) for the Navy, and a short take-off vertical landing (STOVL) version for the Marines and the UK. The JSF program is a family of aircraft performing similar missions, with a mix of components, systems, and technologies. 7 Since the early 1990s, DARPA had funded various STOVL projects expected to develop aircraft to replace both U.S. Marine Corps AV-8B Harriers and the UK Royal Navy’s Sea Harriers. The merger of these research-development efforts with the JAST program in early 1995 cleared the way for U.S.-UK collaboration in JSF development. 8 John Tirpak, “Strike Fighter,” Air Force Magazine, October 1996, pp. 22-28; Philip Hough, “An Aircraft for the 21st Century,” Sea Power, November 1996, pp. 33-34. CRS-4 Component commonality among the three variants is projected to be at 70% to 90%.9 Many of the high-cost components are common, including engines, avionics, and major structural components of the airframe. Former Secretary of Defense William Cohen stated that the JSF’s joint approach “avoids the three parallel development programs for service-unique aircraft that would have otherwise been necessary, saving at least $15 billion.”10 The JSF will be powered by the Pratt & Whitney F135 engine, which was derived from the F-22A’s Pratt & Whitney F119 power plant. Consistent with congressional direction in 1996, DOD established an alternative engine program (F136), with the General Electric/Rolls-Royce Fighter Engine Team, to compete with the F135 for JSF production and operations and support (O&S) contracts. In addition to teaming up with GE on the F136 engine, Rolls-Royce is contracted to develop and produce the STOVL lift fan system that will be used with both the F135 and F136 engines. The net cost-benefit of an alternate engine for the JSF program has periodically been debated, and DOD has attempted to eliminate funding for the F136 (removing funding for the engine in the FY2007, FY2008, and FY2009 budget requests).11 Congress has acted multiple times throughout the program’s history to ensure continued DOD support for the F136. All JSF planes will be fifth-generation, single-engine, single-seat aircraft with supersonic dash capability and some degree of stealth (low observability to radar and other sensors).12 Combat ranges and payloads will vary in the different service variants. For example, as currently planned, combat radius requirements are 590-690 nautical miles (nm) for the Air Force, 600-730 nm for the Navy, and 450-550 nm for the Marine Corps. All three variants are planned to carry weapons internally (two 2,000 lb. weapons for the CTOL and CV variant and two 1,000 lb. weapons for the STOVL).13 All versions will also carry AIM-120 AMRAAMs (advanced medium9 Operational Requirements call for 70% to 90% commonality between all variants. Lockheed Martin notes currently that over 80% of all parts are common on all three variants. Clarence A. Robinson, Jr., “A New Fighter Paradigm,” F-35 Lightning II Commemorating First Flight. 10 Letter from Secretary of Defense William S. Cohen to Rep. Jerry Lewis, June 22, 2000. Transcript made available by Inside the Airforce, June 23, 2000. 11 See CRS Report RL33390, Proposed Termination of Joint Strike Fighter (JSF) F136 Alternate Engine, for more information. Also see “Dual Engine Development Could Saddle JSF with up to $800 Million Bill,” Inside the Navy, August 5, 1996, p. 2; “Despite Demand for Second JSF Engine Source, F120 Comes up Short,” Aerospace Daily, October 18, 1996, p. 102; U.S. Congressional Budget Office, A Look at Tomorrow’s Tactical Air Forces by Lane Pierrot and Jo Ann Vines, January 1997, p. 53. 12 Fifth-generation fighters combine new developments such as thrust vectoring, composite materials, supercruise, stealth technology, advanced radar and sensors, and integrated avionics to greatly improve pilot situational awareness. Currently, only the F-22 and F-35 are considered fifth-generation. Russia has a fifth-generation fighter under development and it is due for its first flight in 2009. 13 The STOVL variant weapons load was reduced to assist with overall aircraft weight reduction efforts in 2004. Background information provided by the F-35 Joint Program (continued...) CRS-5 range air-to-air missiles, with a range of about 26 nm/48 km depending on altitude14). General Dynamics is under contract to develop the 25mm gun for the F-35. The four-barrel GD-425 under development for the F-35 will be carried internally in the CTOL version and externally in the CV and STOVL variants.15 Performance features regarding radar signature, speed, range, and payload were determined on the basis of trade-offs between performance and cost, with the latter being a critical factor. Program officials have emphasized that cost and performance trade-offs are critical elements of the program, and were the basis for the joint-service operational requirements that determined the selection of the Lockheed Martin contractor team for the System Development and Demonstration (SDD) phase.16 The 1997 Quadrennial Defence Review (QDR) report observed that “Uncertainties in prospective JSF production cost warrant careful Departmental oversight of the costbenefit tradeoffs in design to ensure that modernization and force structure remain in balance over the long term.”17 In other words, production costs must be low enough that these aircraft can be bought in sufficient quantities to maintain desired force levels. Thus, the parameters of the JSF’s performance and operational capabilities are subject to refinement for reasons of cost, technological developments, and future threat assessments.18 Program Management The JSF program is jointly staffed and managed by the Department of the Air Force and the Department of the Navy (comprising the Navy and the Marine Corps), with coordination among the services reinforced by alternating Air Force and Navy Department officials in key management positions. For example, Lt. General George Muellner, USAF, was the program’s first director in 1994, with Rear Admiral Craig Steidle, USN, serving as deputy director. Subsequently, Rear Admiral Steidle directed the program, with Brigadier General Leslie Kenne, USAF, as his deputy in late 1996 and his successor as program director in August 1997. The current director is Maj. Gen. Charles Davis, USAF. Service Acquisition Executive (SAE) responsibility also alternates, with the Air Force having that responsibility when the program director is from the Navy Department, and the Navy in that role with an Air Force director of the program. 13 (...continued) Office, September 2007. 14 Steven Zaloga, “AIM-120 AMRAAM,” World Missiles Briefing, Teal Group Corp., January 1997, p. 5. 15 “JSF programs says gun system is ahead of schedule, under cost,” Aerospace Daily and Defense Report, September 26, 2005. 16 “Tradeoffs Will Be Made to Contain JSF Costs,” Aerospace Daily, September 26, 1997, p. 469. 17 U.S. Department of Defense, Report of the Quadrennial Defense Review [by] William S. Cohen, Secretary of Defense, May 1997, p. 46. 18 The Joint Program Office notes that the F-35’s Key Performance Parameters (KPPs) have not changed since Milestone B in 2001. CRS-6 In 2004, appropriations conferees followed a House recommendation to direct DOD to review this alternative management arrangement. House appropriators believed that “management of program acquisition should remain with one Service, and that the U.S. Navy, due to its significant investment in two variants of the F-35 should be assigned all acquisition executive oversight responsibilities.”19 Conferees directed that DOD submit a report on the potential efficacy of this change. Prior to the release of the DOD report, former Air Force Chief of Staff General Jumper was quoted as saying that he also supported putting one service in charge of JSF program acquisition.20 However, General Jumper highlighted the significant investment the Air Force was making in the JSF program in response to the congressional language favoring the Navy. In DOD’s response to Congress, the report noted the current arrangement ensures one Service does not have a “disproportionate voice” when it comes to program decisions and that the current system is “responsive, efficient, and in the best interests of the success of the JSF program.”21 Since DOD’s response to Congress in 2004, the issue of JSF program management has not been raised. Funding and Projected Costs The Defense Department’s quarterly Selected Acquisition Report of December 25, 2007, estimated the JSF program at $298.8 billion in then-year dollars for 2,456 aircraft, which equates to a program acquisition unit cost (PAUC) of $121.6 million per aircraft. The average procurement cost (APUC) (which does not include R&D or other costs) is estimated at $103.9 million per aircraft. The December 2005 SAR noted that the JSF program breached a “Nunn-McCurdy” cost growth limit: unit cost growth over 30% of the original Acquisition Program Baseline.22 The December 2007 PAUC and APUC cost estimates are, respectively, 38.8% and 38.0% higher than cost estimates made in October 2001. Since 2002, the JSF program estimate has increased by $100 billion due primarily to a one-year extension in the program’s System Development and Demonstration phase, a corresponding one-year delay in procurement (from FY2006 to FY2007), revised annual quantity profiles, and revised labor and overhead rates.23 Much of this increased cost and schedule slippage was incurred to address weightdriven performance issues in the development of the F-35B, the STOVL variant. 19 H.Rept. 108-553 (H.R. 4613), p. 234 20 Elizabeth Rees, “Jumper Supports Single Service Retaining JSF Acquisition Oversight,” Inside the Air Force, August 6, 2004. 21 U.S. Department of Defense, Report to Congress on Joint Strike Fighter Management Oversight [forwarded by] Michael W. Wynne, Under Secretary of Defense for Acquisition, Technology and Logistics, December 20, 2004. 22 JSF program breach of Nunn-McCurdy was also reported and addressed in the 2003 SAR. The FY2006 National Defense Authorization Act directed a change in reporting based on the “original” Acquisition Program Baseline resulting in a second breach of Nunn-McCurdy. 23 Summaries of DOD’s Select Acquisition Reports can be found at [http://www.acq. osd.mil/ara/am/sar/index.html]. CRS-7 DOD’s FY2009 budget requests $6.9 billion in JSF funding. As it did in FY2007 and in FY2008, DOD proposes to eliminate funding for the F136 Alternate Engine. The proposed termination of the F136 drew considerable scrutiny in the 109th Congress (second session) and 110th Congress (first session). Congress stipulated in the 2008 National Defense Authorization Act (NDAA) (P.L. 110-181, Sec 213)24: The Secretary of Defense was to “ensure the obligation and expenditure in each such fiscal year of sufficient annual amounts for the continued development and procurement of two options for the propulsion system for the Joint Strike Fighter.” Development and Schedule The JSF is in its seventh year of System Development and Demonstration (SDD). Figure 2, below, from DOD Instruction 5000.2, Operation of the Defense Acquisition System, depicts graphically the acquisition system and where SDD fits into the process.25 Figure 2. Defense Acquisition Management Framework Like some other aviation procurement programs, the JSF has experienced cost growth, schedule slippage, and a reduction in production rates. For example, to address growing weight-driven performance problems encountered early in SDD, DOD extended the SDD phase one year and correspondingly delayed the F-35’s scheduled first flight from late 2005 to the summer of 2006 (first flight occurred on December 15, 2006); the beginning of low-rate initial production shifted from 2006 24 See Conference Report (110-477) to accompany H.R. 1585. See CRS Report RL33390 for more information about the F-136 Alternate Engine Program. 25 JSF program milestones: Concept Development (CDP) in November 1996. Milestone B reached on October 2001, with program successfully completed the CDP exit criteria. Critical Design Review for the CTOL and STOVL variants were completed in February 2006, with the Defense Acquisition Board approving Low Rate Initial Production (LRIP) in March 2006. CRS-8 to 2007. Currently, SDD developmental flight testing will conclude October 2012 and the SDD contract period of performance will end a year later.26 In June 2005, DOD officials reported that weight reduction efforts were successful and approved the revised development schedule.27 Extending SDD and producing aircraft at lower annual rates, however, contributed to increased unit cost growth. Rather than request additional funding, JSF program officials instead paid these costs by spending approximately four-fifths of its $2 billion in “management reserves.”28 Faced with an impending contract over-run, DOD cut two test aircraft from the F-35 program and reduced the number of SDD flight tests.29 The goal of these cost-saving measures was to help bring the management reserve account back up to about $1 billion, which is considered an acceptable amount to complete flight testing. The JSF is expected to remain in production at least through the 2030s. Current plans call for the JSF to be manufactured in several locations. Lockheed Martin will build the aircraft’s forward section in Fort Worth, TX. Northrop Grumman will build the mid-section in Palmdale, CA, and the tail will be built by BAE Systems in the United Kingdom. Final assembly of these components will take place in Fort Worth. Italy is working with Lockheed Martin and the Joint Program Office on the potential of erecting a second final assembly and checkout facility in Italy.30 Production Quantities31 In 1996, preliminary planning estimated over 3,000 aircraft: 2,036 for the Air Force, 642 for the Marines, 300 for the U.S. Navy, and 60 for the Royal Navy. In May 1997, however, the QDR recommended reducing projected procurement for the U.S. armed forces from 2,978 JSF aircraft to 2,852: 1,763 for the Air Force, 609 for the Marines, and up to 480 for the Navy.32 Thus, the program would comprise 2,912 aircraft (2,852 U.S. and 60 UK JSFs), based on these recommendations. Procurement profiles for all variants and purchasing agencies are shown in Appendix B of this report. 26 IOT&E will conclude in October 2013 bringing SDD to a close. 27 Marc Selinger, “DoD Approves detailed ‘re-plan’ for Joint Strike Fighter,” Aerospace Daily & Defense Report, June 2, 2005. 28 Management reserves are funds set aside to mitigate risk during development. 29 “Pentagon Trims JSF Test Program.” Aviation Week & Space Technology December 3, 2007. 30 Michael Sirak, “F-35 Program May Get First International Orders In Third Production Lot in 2009,” Defense Daily International, June 22, 2007. 31 See Appendix B for proposed procurement quantities through FY2034 (the last planned procurement year for the United States). 32 Quadrennial Defense Review Cuts Procurement in FY1999, 2000, Aerospace Daily, May 20, 1997, p. 280. CRS-9 In 2003 the Department of the Navy (DON) reduced its planned procurement of 1,089 F-35s to 680 aircraft as part of the Navy/Marine Corps Tactical Aviation Integration Plan.33 In the spring of 2008, DON officials announced that under current plans, a current shortfall in fighter aircraft of 15 aircraft would grow to a deficit of over 90 aircraft by FY2017.34 It is unclear what impact this potential, projected shortfall might have on the DON’s JSF procurement plans. Congress and DOD may have occasion to revisit the Air Force’s F-35 procurement plans. In hearings on the Air Force’s FY2009 budget request, Air Force leaders testified that due to new estimates of the life of the legacy fighter force, the current F-22 and JSF procurement plans would likely leave a gap of up to 800 fighter aircraft by the year 2024.35 Since the JSF is a long-term program, projected quantities are more subject to change than in the case of aircraft already in full-rate production. Near-term reductions in quantity could be made up in future years, either through increased U.S. purchases or through foreign sales. However, concerns have been raised that nearterm quantity reductions could scare off foreign participation and raise the aircraft’s unit price. The GAO views the budget and schedule changes to the JSF program in a more negative light. In March 2005, GAO wrote that the original business case for the aircraft “unexecutable,” in large part because of decreased numbers of aircraft to be procured.36 Potential F-35 Bases In October 2006, Air Force officials indicated the six tentative locations where F-35s would be based. These locations were Nellis AFB, NV; Edwards AFB, CA; Hill AFB, UT; Eglin AFB, FL; Shaw AFB, SC; and Kadena Air Base, Japan. The Air Force is now awaiting environmental studies before making a final determination. The Marine Corps has tentatively indicated that MCAS Beaufort, MCAS Yuma, MCAS Iwakuni, MCAS Miramar, and MCAS Cherry Point will be the bases for the F-35, again pending their environmental studies and approval of the basing plan. Basing decisions for the JSF may be of interest to many in Congress. The F-35 is thought by many to be the last manned aircraft that DOD is likely to develop for some time and is projected to be in service long after other combat aircraft have been retired. Those wishing to keep military bases relevant, and to potentially “BRACproof” them, may compete vigorously for the JSF. 33 See CRS Report RS21488 for more information on the DON plan. 34 See CRS Report RS22875 for more information on this potential shortfall in DON fighters. 35 Lieutenant General Daniel Darnell, Deputy Chief of Staff Air, Space and Information Operations, Plans and Requirements. “ Senate Armed Services Subcommittee on Airland Holds Hearing on the Fiscal 2009 Budget for Air Force and Navy Aviation Programs.” Congressional Quarterly. Congressional Transcripts. April 9, 2008. p. 16 36 GAO-05-271, March 15, 2005. CRS-10 Allied Participation Allied participation in the JSF development program has been actively pursued as a way to defray some of the cost of developing and producing the aircraft, and to “prime the pump” for export. Congress insisted from the outset that the JAST program include ongoing efforts by the Defense Advanced Research Projects Agency (DARPA) to develop more advanced STOVL aircraft, opening the way for British participation. From the Allied perspective, they saw the F-35 as an affordable avenue to acquiring a fifth-generation fighter, technical knowledge such as stealth, and industrial opportunities for domestic firms. The two JSF developmental phases where international participation has been offered are (1) Systems Development and Demonstration (SDD) and (2) Production, Sustainment and Follow-On Development (PSFD). Initial Operational Test and Evaluation (IOT&E), a subset of SDD, is another area that partner nations are assisting the program with. Within each of these phases, the level of participation and funding drives the amount of influence the respective nation can wield. System Development and Demonstration (SDD) Eight countries, from 2001 to 2002, signed on to the JSF program to support the anticipated 10-year SDD phase. Partnership was broken down into three levels, by the size of monetary contributions to the program. The higher the investment level, the greater the nation’s voice with respect to aircraft requirements, design, and access to technologies gained during development. The United Kingdom is the only “Level 1” partner contributing approximately $2 billion to this phase. UK participation actually began at program outset. On December 20, 1995, the U.S. and UK governments signed a memorandum of understanding (MOU) on British participation in the JSF program as a collaborative partner in the definition of requirements and aircraft design. This MOU committed the British government to contribute $200 million towards the cost of the 1997-2001 concept demonstration phase.37 On January 17, 2001, the United States and United Kingdom finalized the UK’s SDD participation, which equated to approximately 8% of the total SDD program. Program proponents noted the UK’s signature represented “strong international affirmation of the JSF concept,” even though prime contractor competition and selection had not been completed.38 Many UK firms, such as British Aerospace and Rolls-Royce, have strong participation in the program. Level II partners consist of Italy and the Netherlands, contributing $1 billion and $800 million, respectively. On June 24, 2002, Italy became the senior Level II partner, with the goal of replacing its leased US F-16s and complimenting its Eurofighter Typhoons, and occupies five positions within the Joint Program Office.39 37 “U.S., U.K. Sign JAST Agreement,” Aerospace Daily, December 21, 1995, p. 451. 38 Eric Tegler, “International Instrument: Building the F-35 In Partnership,” F-35 Lightning II Commemorating First Flight, p. 71. 39 “F-35 Joint Strike Fighter (JSF) Lightning II: International Partners,” (continued...) CRS-11 Italy has been pushing to have its own final assembly line, in addition to the possibility of a maintenance and upgrade facility. The Netherlands signed on to the program on June 17, 2002, after it had conducted a 30-month analysis of potential alternatives. The Dutch see their participation in JSF as a boost to its standings as a maintenance, repair, and overhaul hub in Europe.40 The remaining nations of Australia, Denmark, Norway, Canada, and Turkey signed on to the JSF program as Level III partners, with contributions ranging from $125 million to $175 million. While contributions are less than their Level I and II partners, the benefit to all nations who participate is a strong commitment by the U.S. to export the aircraft to partner countries once the JSF is in production.41 Turkish officials have stated that participation in the JSF program is a “major opportunity for our defense industry.”42 Foreign Military Sales (FMS) JSF program managers also offer FMS-level of participation for those countries unable to commit to partnership in the JSF’s SDD phase. Israel and Singapore are believed to have contributed $50 million each, and they are “Security Cooperative Participants.” This relationship provides “specific case scope outside the cooperative development partnership.”43 JSF officials have discussed the aircraft with the defense staffs of many other allied countries as prospective customers, including Germany, Greece, and Spain. The Polish government is reportedly leaning toward an FMS investment of $75 to $100 million in the JSF program.44 Production, Sustainment, and Follow-On Development (PSFD) Unlike the SDD phase, PSFD will not make any distinction as to “levels.” In signing the PSFD MOU, partner nations state their intentions to purchase the JSF, and in what quantity and variant, and a determination is made as to their delivery schedule. The governance structure of the program has broadened to allow all participating nations to have a voice in follow-on development decisions. PSFD costs will be divided on a “fair-share” based on the programmed purchase amount of the respective nation. Also, unlike the bilateral SDD MOUs, PSFD is an agreement among all partner nations. Program executives noted the difficulty in coming to an 39 (...continued) [http://www.globalsecurity.org/military/systems/aircraft/f-35-int.htm], accessed on October 3, 2007. 40 Tegler, pp. 74-75. 41 “Australia, Belgium Enter Joint Strike Fighter Program as EMD Partners,” Inside the Air Force, April 21, 2000. 42 Bekedil, Burak Ege and Umit Enginsoy, “Turks to Pay up to $1 Billion to Join JSF Development,” Defense News, July 17, 2000, p. 6. 43 Selected Acquisition Report. Office of the Secretary of Defense for Acquisition. December 31, 2005. 44 Grzegorz Holdanowicz, “Poland Steps Up Interest in JSF,” Jane’s Defense Weekly, July 18, 2001. CRS-12 agreement on PSFD because of the expectancy of “offset” arrangements within the agreement.45 Offset arrangements, considered the norm in defense contracts with foreign nations, usually require additional incentives to compensate the purchasing nation for the agreement’s impact to its local workforce.46 JSF executives decided to take a different approach, in line with the program’s goal to control costs, to avoid offsets and promote competition as much as possible. All partner nations have agreed to compete for work on a “best-value” basis and have signed the PSFD MOU. Initial Operational Test and Evaluation (IOT&E) Currently, the UK, Italy, and the Netherlands have agreed to participate in the IOT&E program. UK, the senior JSF partner, will have the strongest participation in the IOT&E phase. Italy and the Netherlands are contributing a far smaller amount and will take part only in the coalition concept of operations (CONOPS) validation testing.47 Other partner nations are still weighing their option to participate. The benefits to participation are expedited acquisition of aircraft, pilot training for the test cycle, and access to testing results. Current Issues The F-35 presents numerous potential issues for Congress. The F-35 program’s size, its international scope, and its competing objectives for performance, cost effectiveness, and commonality combine to make it arguably the most challenging defense acquisition program ever. A discussion of the most pertinent issues appears below. These issues are not mutually exclusive and overlap along several dimensions. Concurrency of Testing and Production The 2005 National Defense Authorization Act directed the GAO to conduct annual reviews of the JSF program to assess the SDD’s meeting of key cost, schedule, and performance goals.48 In March 2006, the GAO issued its second report highly critical of the JSF testing and production schedule.49 GAO asserted that the amount of overlap between testing and production in the JSF program is risky and could lead to considerable cost growth in the future. GAO noted that the JSF program was to begin low-rate initial production (LRIP) before 1% of flight tests had been completed. GAO noted that up to 424 F-35 aircraft may be built, at a cost of $49 billion, before development testing is complete. The JSF program intends to make initial production orders on a cost reimbursement contract, “placing an unusually 45 Tegler, p. 79. 46 Travis Taylor, “An Empirical Evaluation of Offset Arrangements,” University of Richmond, July 2001, p. 6. 47 Telephonic conversation with OSD/AT&L, October 3, 2007. 48 P.L. 108-375; 118 Stat 1833; October 28, 2004. 49 Joint Strike Fighter: DoD Plans to Enter Production before Testing Demonstrates Acceptable Performance (GAO-06-356), Government Accountability Office, March 2006. CRS-13 high risk burden on the government during the early production phase.”50 GAO recommended adopting a more evolutionary approach to developing and producing the F-35, similar to the block upgrade approach pursued successfully in the F-16 program. The Office of the Secretary of Defense (OSD) has countered GAO’s assertions, noting that GAO’s recommended block development approach would extend SDD by up to eight years, with an associated cost of approximately $13 billion (in thenyear dollars).51 While GAO’s approach would delay fielding of the F-35, OSD noted that there was no GAO analysis as to the costs of legacy fleet extensions or procurement price increases. The JSF Joint Program Office noted that program acquisition strategy was designed to take advantage of knowledge gained from the F-22 program and legacy programs along with improvements in modeling and simulation to reduce the development period.52 While this strategy presents increased program risk, proponents note projected cost savings as a result of an expedited testing cycle and retirement of legacy systems. Proponents also highlight that fixes discovered during a more concurrent (i.e., expedited) testing/production cycle are usually much less expensive than the costs associated with a more exhaustive testing period, with less overlap and extended production period. This argument is strengthened somewhat by a Defense Aerospace case study that determined continuity in development is the best way to avoid cost overruns.53 Programs that are able to manage developmental issues without lengthy program “freezes” were more apt to keep production cost growth to a minimum. Mid-Course Risk Reduction Plan In December 2007 DOD announced that it had decided to cut two test aircraft from the JSF program.54 Other changes to the test program included foregoing intermediate flight test measurements, reducing the number of flight tests, and employing ground laboratories and flying test beds (non-JSF aircraft instrumented to simulate the F-35) instead of actual JSF aircraft.55 DOD calls these changes to the F-35 flight test program the “Mid-Course Risk Reduction Plan.” The purpose of the plan is to save approximately $600 million and replenish management reserves, a pot of money saved to mitigate unforseen developments in the development program. These reserves had been depleted by program officials who needed to pay escalating program costs. 50 Ibid., p. 6. 51 DOD Information Paper for SASC PSM’s Stan O’Connor and Creighton Greene in response to GAO-06-356, June 17, 2006. 52 Background information provided by JSF Joint Program Office, September 2007. 53 “Sticker Shock: Estimating the Real Cost of Modern fighter Aircraft,” DefenseAerospace.Com, 2006, p. 3. 54 “Pentagon Trims JSF Test Program.” Aviation Week & Space Technology. December 3, 2007. 55 Michael Fabey. “Raptor Stealth Maintenance, JSF Testing Questioned by DOT&E.” Aerospace Daily & Defense Report. February 25, 2008. CRS-14 Opponents to the Mid-Course Risk Reduction Plan argue that it adds risk to a program already facing excessive risk due to the overlap between development and production described above. Generally speaking, opponents believe that this plan is detrimental to the test program and raises the risk that design and performance shortcomings will not be discovered until late in the process, when it will be more costly to redress them. Specifically, opponents note that the number of JSF flight tests planned has been reduced twice prior to the Mid-Course Risk Reduction Plan. In October 2005, DOD planned 6,979 F-35 flight tests. Currently, only 5,147 are planned.56 Further, eliminating two test aircraft, it is argued, removes an important hedge against potential attrition. If something were to go awry with one or more of the test aircraft, fewer are available to take up the slack. Proponents of this move state that test flights would have been reduced regardless of the status of the management reserve account, owing to testing efficiencies gained through commonality and lab investments. Proponents also assert that arguments against this plan are based on old models of Test & Evaluation. The JSF, they say, is implementing state-of-the-art technological advances in aircraft instrumentation and simulation, which reduces the need for actual flight tests. Affordability Much has been made about the F-35’s overall price tag of almost $300 billion (TY$). In addition to the aggregate amount of funding required, several other affordability issues stand out. First, as the production phase of the F-35 accelerates, the program will require large and sustained expenditures at the same time DOD is facing acute budgetary challenges. Over the next 20 years, DOD projects spending over $10 billion annually on the F-35.57 At the same time, DOD aims to recapitalize other aircraft fleets, such as tankers; increase the Army and Marine Corps personnel end-strength; and prosecute the wars in Iraq and Afghanistan. In other words, the timing of F-35 program costs may be as big of a challenge as the overall amount. Second, as the competing funding requirements described above collide, both DOD and Congress may be tempted to reduce the overall number of F-35s to be procured. Experience suggests that reducing multiple defense acquisition programs is more feasible than cancelling one. Planned procurement quantities of the F-22 and the F/A-18E/F, for example, have been reduced by 70% and 54%, respectively. Procuring fewer aircraft reduces overall costs but increases the aircraft’s per-unit cost. This would be particularly detrimental to a program such as the F-35, which was designed specifically to be moderately priced. Third, there are strong differences of opinion over how F-35 costs are calculated and presented. DOD’s latest estimate of the F-35 program, for example, shows the 56 “Joint Strike Fighter: Recent Decisions By DOD Add to Program Risks.” Government Accountability Office. (GAO-08-338) March 2008. p.16. 57 F-35 (JSF). Selected Acquisition Report (SAR). Office of the Secretary of Defense (AT&L) December 25, 2007. p.15-21. CRS-15 overall cost decreasing from $299 billion in December 2006 to $298 billion in December 2007. Some suggest that these figures are misleading, because the largest “savings” reported by DOD in its latest report were not achieved by improvements in design or manufacture, but instead were achieved by a moving costs from one category to another.58 The GAO offered strong criticism of JSF cost estimates, writing that they were not comprehensive, not accurate, not well documented, nor credible.59 In summary, GAO noted that the JSF cost estimates did not include $7 billion for the F136 engine, and that the official JSF cost estimates are at odds with estimates made by three independent DOD agencies. JSF supporters dispute the GAO’s findings, arguing that the program office’s cost models are more reliable than those used by other organizations.60 Fourth, there are a number of factors that will influence JSF costs, either positively or negatively, which are difficult to predict. By statute, DOD must pursue the JSF F136 Alternate Engine program. As mentioned above, GAO notes that the F136 development costs are not included in current JSF cost estimates. The larger question is whether these costs, included or not, will be recouped by competition between the F135 and the F136 during JSF production and operation.61 Also, the DON has not yet determined how many of its 680 F-35s will be CV variants and how many will be STOVL variants. These aircraft have different operational capabilities, and different production and operating costs. Finally, JSF program officials anticipate major savings because of a high degree of commonality in components and systems among the three versions, which are to be built on a common production line. However, the F-35 is not meeting its goals for commonality, and as the program wrestles with final development challenges, commonality could be compromised further, which would lead to cost increases.62 Projected Fighter Aircraft Inventory Shortfalls In the late winter and early spring of the FY2009 legislative cycle, both Air Force and Department of the Navy (DON) officials testified that they were facing a projected “fighter gap.” Because of high combat aircraft utilization rates in Afghanistan and Iraq, legacy air forces (A-10s, F-15s, F-16s, F/A-18s) were wearing out faster than previously predicted, while new aircraft procurement (e.g., F-22A, F35, F/A-18E/F) remained steady or had declined. At its worst, DON officials projected a deficit of more than 90 aircraft in FY2017-FY2020.63 Air Force officials projected a potential gap of up to 800 fighter aircraft by the year 2024.64 58 David Fulghum. “Dueling Analyses; Questions Remain About the Fundamental Soundness of Top Pentagon Programs.” Aviation Week & Space Technology. April 14, 2008. 59 GAO-08-388. summarized on pp. 3-4 and addressed in detail throughout the report. 60 Amy Butler. “Cost Question.” Aviation Week & Space Technology. July 14, 2008 61 See CRS Report RL33390 for more information on the F136 engine program. 62 GAO-08-388. p. 10. 63 See CRS Report RS22875 for more information. 64 Lieutenant General Daniel Darnell, Deputy Chief of Staff Air, Space and Information (continued...) CRS-16 These projections could affect the F-35 program in a number of different ways. DOD officials could, for example, accelerate F-35 procurement and increase the total number to be procured. Air Force officials have testified that they wish to double F35 purchases over the next five years to alleviate the projected shortfalls.65 Although accelerating F-35 purchases may appear beneficial to the program’s supporters, it might also have negative consequences. JSF officials have stated that to meet the current schedule, they may be forced to field less capable STOVL aircraft and upgrade them at later dates. It is not clear what effect this block upgrade approach would have on overall costs.66 Another way to address the projected fighter shortfall would be to purchase more F-15s, F-16s, F/A-18E/Fs, and F-22s, all of which are still in production. The Navy, reportedly, is considering procuring 69 more Super Hornets to close the fighter gap.67 This option might be cheaper than purchasing more F-35s, although these aircraft are less capable than the F-35. (The F-22 is the exception in this comparison because it is more expensive than the F-35 and more capable in many dimensions.) Additional purchases of these aircraft, however, especially if at the F-35’s expense, could raise F-35 unit cost and potentially alienate foreign partners, who are already concerned about cost growth in the JSF program.68 A similar option would be to execute a service life extension (SLEP) program for those aircraft that are wearing out prematurely. This option may prove to be cheaper than purchasing new aircraft. However, SLEPing aircraft keeps them in depot and unavailable for operations for months, if not years, which can constrain military capabilities and place even greater pressure on those aircraft still flying. A final option to address the projected fighter gap would be to do nothing. By sticking with the current fighter aircraft procurement plans, DOD may end up reducing the overall inventory of combat aircraft. This may be a risk that is worth taking, considering other U.S. aviation capabilities such as bombers, cruise missiles, and armed-UAVs, and the lack of perceived threats. On the other hand, today’s relatively large inventory of fighter aircraft is well-worn from excessive use. There is no reason to think that tomorrow’s smaller fighter aircraft inventory would not experience equally high operations tempo. 64 (...continued) Operations, Plans and Requirements. “ Senate Armed Services Subcommittee on Airland Holds Hearing on the Fiscal 2009 Budget for Air Force and Navy Aviation Programs.” Congressional Quarterly. Congressional Transcripts. April 9, 2008. p.16 65 John Reed. “Air Force Working To More Than Double The Pace Of F-35 Purchases.” Inside the Air Force. July 25, 2008. 66 Dan Taylor. “Heinz: JSF Program Prepared to Trim Aircraft to Stay On Schedule.” Inside the Air Force. July 11, 2008. 67 Philip Ewing. “New Hornets Could Fill Void Until F-35s Arrive.” Navy Times. March 17, 2008. 68 Gregor Ferguson. “JSF Partners Meet to Talk Initial Price, Orders.” Defense News. June 9, 2008. CRS-17 Implications for U.S. Defense Industry As DOD’s largest single weapon system acquisition program, the JSF is a focal point for discussions regarding the U.S. defense industrial base. The October 2001 award of the JSF Engineering Manufacturing Development (EMD) contract to a single company (Lockheed Martin) raised concerns in Congress and elsewhere that excluding Boeing from this program would reduce that company’s ability to continue designing and manufacturing fighter aircraft. This, in turn, would have a negative effect on the U.S. defense industrial base.69 Similar concerns were raised in 2006 when DOD proposed terminating the F136 Alternate Engine. In this case, some worried that if the F136 were cancelled, General Electric (GE) would not have enough business designing and manufacturing fighter jet engines to continue competing with Pratt & Whitney (the manufacturer of the F135 engine) in the future. This would leave the United States dependent on only one domestic manufacturer of this class of engine. Others argued that GE’s considerable business in both commercial and military engines was sufficient to sustain GE’s ability to produce this class of engine in the future.70 The JSF program could also have a strong impact on the U.S. defense industry through export. Most observers believe that the JSF could potentially dominate the combat aircraft export market much as the F-16 has. Like the F-16, the JSF appears to be attractive because of its relatively low cost, flexible design, and promise of high performance. Also, analysts note that during his first stint as Defense Secretary, Donald Rumsfeld played an instrumental role in launching the F-16 program by including foreign partners in the aircraft’s development.71 Many competitors, including France’s Rafale, Sweden’s JAS Gripen, and the European Typhoon, are positioned to challenge the JSF in the fighter export market, or take its market share if the program is cancelled. Also, few countries have expressed interest in buying either the F-22A or the F/A-18E/F. The one country that has expressed interest in the F-22A, Japan, will most likely be unable to procure the F-22 because of a proposed clause in the FY2008 Appropriations bill upholding a ban on F-22 exports.72 Instead, Japan is being redirected towards the F-35. It can also be argued that the demand for civilian transport aircraft after 2000 will be strong enough to sustain a robust U.S. aviation industry, given the need to replace aging aircraft with quieter and more fuel-efficient planes for expanding domestic and international travel markets. For example, the worldwide fighter/attack 69 For more information, see CRS Report RL31360, Joint Strike Fighter (JSF): Potential National Security Questions Pertaining to a Single Production Line, by Christopher Bolkcom and Daniel Else. 70 For more information, see CRS Report RL33390, Proposed Termination of Joint Strike Fighter (JSF) F136 Alternate Engine, by Christopher Bolkcom. 71 Vago Muradian, “Coffman: JSF Critical to Preserving U.S. Leadership in World Fighter Market,” Defense Daily, February 26, 2001. 72 “US Decides to Keep Export Ban on F-22 Stealth Fighter,” Jiji Press Ticker Service, July 26, 2007. CRS-18 market in 2005 has been estimated to be worth about $13.2 billion, while the commercial jet transport market is projected to be worth about $43.5 billion at that time. Compared with its European and Asian competitors, the U.S. aviation industry appears to be well-positioned to meet the needs of an expanding world market for civil aircraft after the turn of the century.73 The extent to which such economic conditions may preserve an adequate U.S. defense industrial base for the development and production of combat aircraft is debatable, however, given the significant differences between civilian and military aircraft requirements and technologies. Others fear that by allowing foreign companies to participate in this historically large aircraft acquisition program, DOD may be inadvertently opening up U.S. markets to competitors who enjoy direct government subsidies. These government subsidies could create an unfair advantage for them relative to U.S. companies, it is argued, and the result could be the beginning of a longer-term foreign penetration of the U.S. defense market that could erode the health of the U.S. defense industrial base. In May 2004, the GAO release a report that found the JSF program could “significantly impact” the U.S. and global industrial base.74 The GAO found that two laws designed to protect segments of the U.S. defense industry, the Buy American Act and the Preference for Domestic Speciality Metals clause, would have no impact on decisions regarding which foreign companies would participate in the JSF program. This is because DOD has decided that foreign companies that participate in the JSF program, and which have signed reciprocal procurement agreements with DOD to promote defense cooperation, are eligible for a waiver. Program proponents note the economic potential that comes with participation in the program. A 2003 DOD study into international participation concluded that the potential exists for partner nations to earn between $5 and $40 of revenue for every $1 invested through program contracts.75 Current program policy to eschew offset arrangements will favor governments and corporations that take an aggressive approach to providing “best-value” bids for JSF work. On the positive side, this approach seeks to be the most cost-effective. However, partner countries that cannot compete effectively in this environment could be frustrated by the lack of contracts awarded. Over the last couple of years, press reports have indicated that a number of partner nations have threatened to withdraw from the program because of frustrations over workshare and technology transfer issues.76 As previously discussed, the F-35 73 Richard Aboulafia, “Market Overviews — Commercial Jet Transports, Fighter/Attack Aircraft,” World Military and Civil Aircraft Briefing, Teal Group Corp., March 1997. 74 General Accountability Office, Joint Strike Fighter Acquisition: Observations on the Supplier Base, GAO-04-554, May 2004. 75 “International Industrial Participation: A Study of Country Approaches and Financial Impacts on Foreign Suppliers,” Office of the Deputy Under Secretary of Defense (Industrial Policy), June 2003. 76 See “Norway Signs Industrial Partnership with Eurofighter Consortium,” Defense Daily, (continued...) CRS-19 program has attempted to break from past “offset” arrangements in an effort to keep costs down. Technology transfer has also been a problem with the United States’ first export of stealth technology. Congress, in the John Warner National Defense Authorization Act for Fiscal Year 2007, sensing United Kingdom frustrations with technologysharing, advised the Secretary of Defense to share technology consistent with the national security interests of both nations.77 Program officials note that they are working with partner nations to improve their ability to effectively compete for JSF work and are working with DOD expedite technology-transfer issues.78 While workshare and technology transfer issues still remain, no country has pulled its support for the F-35 program, and all have signed the Production, Sustainment, and Follow-On Development memorandum. The issue for U.S. policy makers is how to balance legitimate yet often contradictory concerns regarding security, investment, and industrial competitiveness. Congressional Action The Bush Administration’s FY2009 budget requested $6.9 billion in procurement and R&D funding for the F-35. This request is summarized in Table 1, below. Changes to the request are highlighted in bold text. Table 1. JSF F-35 FY2009 Funding ($ Millions) USN R&D USAF R&D USN Proc. USAF Proc. (8 aircraft) 1,796.5 (APCY) 136.9 Request 1,532.7 1,524.0 (8 aircraft) 1,720.9 (APCY) 258.8 House Authorization (H.R. 5658, 110-652) 1,795.2 1,786.5 Matched procurement funding requests Senate Authorization (S. 3001, 110-335) Matched request 1,747.7 1,774.0 (8 aircraft) 1,796.5 (APCY) 171.9 Note: APCY = Advanced Procurement (current year). 76 (...continued) January 29, 2003; Joris Janssen Lok, “Frustration Mounts Among JSF Partners,” Jane’s Defense Weekly, March 24, 2004; Thomas Dodd, “Danish Companies Consider Quitting JSF Programme,” Jane’s Defence Weekly, January 9, 2004; Tom Kingston, “Unsatisfied Italy May Cut JSF Participation,” Defense News, May 10, 2004; Lale Sariibrahimoglu, “Turkey may withdraw from JSF program,” Jane’s Defence Weekly, November 10, 2004. 77 P.L 109-364; 102 Stat 2134; October 17, 2006. 78 Tegler, p. 81. CRS-20 In their report 110-652, House authorizers expressed considerable frustration with DOD’s lack of funding for the F136. (See pages 227-228). The committee increased the JSF R&D accounts to fund F136 development and for F135 technology insertion. In their report 110-335, Senate authorizers also expressed their concern about DOD’s unwillingness to fund the F-136. The committee added R&D funds to address this shortfall, and added $35 million advanced procurement begin procurement of F136 long-lead items. According to a press release, the House Defense Appropriations Subcommittee mark-up of the administration’s FY2009 budget request provides full funding for the F-35 Joint Strike Fighter, but redistributes funds within the program. The Committee reduces airframe production funding by a total of $786 million, but increases funding by a total of $785 million for $430 million for development of an alternative engine, and $320 million for risk mitigation in the test program (including the restoration of two test aircraft eliminated by the DoD last year).79 The Bush Administration’s FY2008 budget requested $6.1 billion in funding for the Joint Strike Fighter. This request is summarized in Table 2, below. Changes to the request are highlighted in bold text. Table 2. JSF F-35 FY2008 Funding ($ Millions) USN R&D Request Authorization Bill P.L. 110-181 (H.R. 4986, 110-477) Appropriation Bill P.L. 110-116 (H.R. 3222, 110-435) 1,707.3 USAF R&D 1,780.8 USN Proc. USAF Proc. (6 aircraft) 1,112.5 (APCY) 119.5 (6 aircraft) 1,298.1 (APCY) 123.5 1,805,772 1,879,324 Both bills matched JSF procurement funding requests 1,905,772 2,004,324 Note: APCY = Advanced Procurement (current year). As it did in FY2007, DOD proposed in FY2008 to cancel the F136 alternate engine. And again, authorization conferees increased the R&D accounts to fund the F136 program. Section 213 of the report requires DOD to develop a competitive engine for the JSF and to continue competition for the engine throughout the F-35’s production phase. Appropriations conferees added a total of $480 million to the Navy and Air Force R&D accounts for the F136 program. Appropriators also added $200 million to the JSF’s R&D budget for affordability initiatives and information assurance, but docked the F-35 $283 million for excessive award fees and over billing. 79 [http://appropriations.house.gov/pdf/MurthaSubMarkup07-30-08.pdf] CRS-21 The Bush Administration’s FY2007 budget requested $5,290.1 million ($5.3 billion) in funding for the Joint Strike Fighter. The Air Force requested $1,015 million in procurement funds to build five aircraft and purchase long-lead items for eight aircraft in FY2008, and $ 1,999.1 in RDT&E funds. The Navy requested $245 in advance procurement funds (to build eight F-35B aircraft in FY2008) and $2,031 in RDT&E funds. Congressional action on this request is summarized in Table 3, below. Changes to the request are highlighted in bold text. Table 3. JSF F-35 FY2007 Funding ($ Millions) USN R&D USAF R&D USN Proc. USAF Proc. Request 2,031 1,999.1 245 1,015 Authorization Bill P.L. 109-364 (H.R. 5122, 109-702) 2,200 2,170 123 921 Appropriation Bill P.L. 109-289 (H.R. 5631, 109-676) 2,172 2,138 123 489 Both authorizers and appropriators objected to DOD’s plan to eliminate the F136 Alternate Engine and added JSF R&D funds to continue the program. Similarly, both authorizers and appropriators expressed concern about program risk, either explicitly or implicitly, reacting to what some to believe to be an excessive overlap between JSF testing and JSF development. The Bush Administration’s FY2006 budget requested $5,020.0 million ($5 billion) in funding for the Joint Strike Fighter. The Air Force requested $152.4 million in advance procurement and $2,474.8 million in RDT&E funds. The Navy requested $2,393 million in RDT&E funds. Congressional action on this request is summarized in Table 4, below. Changes to the request are highlighted in bold text. Table 4. JSF F-35 FY2006 Funding ($ Millions) USN R&D USAF R&D USAF Proc. Request 2,393.0 2,474.0 152.4 Authorization Bill P.L. 109-163 (H.R. 1815, 109-360) 2,393.0 2,474.0 152.4 Appropriations Bill P.L. 109-148 (H.R. 2863, 109-359) 2,305.1 2,366.7 120 In cutting JSF funding, the appropriations conference report noted that “excessive program risk remains,”80 and that “under the revised aircraft build 80 H.R. 2863 ( 109-359), p. 418. CRS-22 sequence all of these aircraft do not require full funding prior to the beginning of fiscal year 2008.”81 81 H.R. 2863 (109-119), p. 172. CRS-23 Appendix A. JSF Key Performance Parameters KPP JOINT CV Combat Radius 450 nm USMC Profile 590 nm USAF Profile 600 nm USN Profile Sortie Generation 4 Surg / 3 Sust 3 Surg / 2 Sust 3 Surg / 2 Sust Logistics Footprint < 8 C-17 equivalent loads (20 PAA) < 8 C-17 equivalent loads (24 PAA) < 46,000 cu ft 243 ST Mission Reliability 95% 93% 95% STOVL Mission Performance Short Take-Off Distance STOVL Mission Performance Vertical Lift Bring Back USN CTOL Very Low Observable Radio Frequency Signature Interoperability USMC STOVL Maximum Approach Speed Meet 100% of critical, top-level Information Exchange Requirements Secure Voice and Data 550’ N/A N/A 2 x 1K JDAM, 2 x AIM-120 With Reserve Fuel N/A N/A N/A N/A 145 knots Notes: JSF Joint Program Office: October 11, 2007. PAA = Primary Aircraft Authorized, ST = Short Tons, Vertical Lift Bring Back = amount of weapons/fuel that can be safely landed with. CRS-24 Appendix B. JSF Procurement Plan Fiscal Year Annual Total Cumulative (USN & USMC) International 2 0 0 2 2 2008 6 6 0 12 14 2009 8 8 3 19 33 2010 12 18 2 32 65 2011 24 19 2 45 110 2012 42 40 30 112 222 2013 48 42 36 126 348 1621 547 573 2741 3089 DON USAF 2007 To 2034 Note: F-35 Lightning II Program Brief (April 19, 2007), JSF Program Office. (all years) Program: Background and Issues for Congress Ronald O'Rourke Specialist in Naval Affairs June 18, 2009 Congressional Research Service 7-5700 www.crs.gov RL30563 CRS Report for Congress Prepared for Members and Committees of Congress F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Summary The F-35 Joint Strike Fighter (JSF), also called the Lighting II, is a new strike fighter being procured in different versions by the Air Force, Marine Corps, and Navy. The F-35 program is the Department of Defense’s (DOD’s) largest weapon procurement program in terms of total estimated acquisition cost. Current DOD plans call for acquiring a total of 2,456 JSFs for the Air Force, Marine Corps, and Navy at an estimated total acquisition cost (as of December 31, 2007) of about $246 billion in constant (i.e., inflation-adjusted) FY2009 dollars. Procurement of F-35s began in FY2007. Hundreds of additional F-35s are to be purchased by several U.S. allies. The administration’s proposed FY2010 defense budget requests a total of about $10.4 billion in Air Force and Navy research and development funding and procurement funding for the F-35 program, including about $3.6 billion in Air Force and Navy research and development funding and about $6.8 billion in Air Force and Navy procurement funding. The proposed FY2010 budget would fund the procurement of 10 F-35As for the Air Force, 16 F-35Bs for the Marine Corps, and four F-35Cs for the Navy. (Development and procurement of Marine Corps aircraft are funded through the Navy’s budget.) The administration’s proposed FY2010 defense budget also proposes to terminate the F-35 alternate engine program, which is intended to develop the General Electric/Rolls-Royce F136 engine as an alternative to the Pratt and Whitney F135 engine that currently powers the F-35. The George W. Bush administration proposed terminating the alternate engine program in FY2007, FY2008, and FY2009, but Congress rejected these proposals and each year provided funding for the program’s continuation. The issues for Congress for FY2010 are whether to approve, reject, or modify the administration’s funding request for the F-35 program, and whether to approve or reject the administration’s proposal to terminate the alternate engine program. Congress’ decisions on these matters will affect DOD capabilities and funding requirements and the tactical aircraft manufacturing industrial base. The FY2010 defense authorization bill as reported by the House Armed Services Committee on June 18, 2009 (H.R. 2647) recommends reducing procurement of F-35s by two aircraft from the administration’s request, and adding $603 million in funding for the F-35 alternate engine program. H.R. 2647 as reported by the House contains a number of legislative provisions relating to the F-35 program, including a provision relating to the alternate engine program. This report will be updated as events warrant. Congressional Research Service F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Contents Introduction ................................................................................................................................1 Background ................................................................................................................................1 The F-35 In Brief ..................................................................................................................1 In General.......................................................................................................................1 Air Force Version............................................................................................................2 Marine Corps Version .....................................................................................................3 Navy Version ..................................................................................................................4 Engine ............................................................................................................................5 Program Origin and Acquisition Milestones ..........................................................................5 Procurement Quantities .........................................................................................................6 Planned Total Procurement Quantities .............................................................................6 Annual Procurement Quantities.......................................................................................7 Program Management ...........................................................................................................7 International Participation .....................................................................................................8 Cost and Funding ..................................................................................................................9 Sources of Funding .........................................................................................................9 Estimated Total Program Acquisition Cost and Prior-Year Funding................................ 10 Estimated Unit Costs..................................................................................................... 10 Manufacturing Locations .................................................................................................... 11 Proposed FY2010 Budget ................................................................................................... 11 FY2010 Funding Request.............................................................................................. 11 Proposed Termination of Alternate Engine Program ...................................................... 12 Issues For Congress .................................................................................................................. 12 Alternate Engine ................................................................................................................. 12 Summary of Arguments For and Against Termination.................................................... 12 Administration Perspective ........................................................................................... 13 GAO Perspective .......................................................................................................... 15 Press Reports ................................................................................................................ 18 Development Status and Readiness for Higher-Rate Production........................................... 22 Administration Perspective ........................................................................................... 22 GAO Perspective .......................................................................................................... 24 Press Reports ................................................................................................................ 26 Affordability and Projected Fighter Shortfalls ..................................................................... 28 Implications for Industrial Base........................................................................................... 29 Legislative Activity for FY2010 ................................................................................................ 30 FY2010 Defense Authorization Bill (H.R. 2647) ................................................................. 30 House ........................................................................................................................... 30 Figures Figure A-1. Joint Strike Fighter: Key Performance Parameters .................................................. 35 Congressional Research Service F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Tables Table 1. Annual F-35 Procurement Quantities..............................................................................7 Table 2. FY2010 Funding Request for F-35 Program................................................................. 11 Appendixes Appendix. JSF Key Performance Parameters............................................................................. 35 Contacts Author Contact Information ...................................................................................................... 35 Congressional Research Service F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Introduction The F-35 Joint Strike Fighter (JSF), also called the Lighting II, is a new strike fighter being procured in different versions by the Air Force, Marine Corps, and Navy. The F-35 program is the Department of Defense’s (DOD’s) largest weapon procurement program in terms of total estimated acquisition cost. Current DOD plans call for acquiring a total of 2,456 JSFs for the Air Force, Marine Corps, and Navy at an estimated total acquisition cost (as of December 31, 2007) of about $246 billion in constant (i.e., inflation-adjusted) FY2009 dollars. Procurement of F-35s began in FY2007. Hundreds of additional F-35s are to be purchased by several U.S. allies. The administration’s proposed FY2010 defense budget requests a total of about $10.4 billion in Air Force and Navy research and development funding and procurement funding for the F-35 program, including about $3.6 billion in Air Force and Navy research and development funding and about $6.8 billion in Air Force and Navy procurement funding. The proposed FY2010 budget would fund the procurement of 10 F-35As for the Air Force, 16 F-35Bs for the Marine Corps, and four F-35Cs for the Navy. (Development and procurement of Marine Corps aircraft are funded through the Navy’s budget.) The administration’s proposed FY2010 defense budget also proposes to terminate the F-35 alternate engine program, which is intended to develop the General Electric/Rolls-Royce F136 engine as an alternative to the Pratt and Whitney F135 engine that currently powers the F-35. The George W. Bush administration proposed terminating the alternate engine program in FY2007, FY2008, and FY2009, but Congress rejected these proposals and each year provided funding for the program’s continuation. The issues for Congress for FY2010 are whether to approve, reject, or modify the administration’s funding request for the F-35 program, and whether to approve or reject the administration’s proposal to terminate the alternate engine program. Congress’ decisions on these matters will affect DOD capabilities and funding requirements and the tactical aircraft manufacturing industrial base. Background The F-35 In Brief In General The F-35 was conceived as a relatively affordable 5th-generation strike fighter1 that could be procured in three highly common versions for the Air Force, the Marine Corps, and the Navy,2 so 1 Fifth-generation aircraft incorporate the most modern technology, and are considered to be generally more capable than earlier-generation (e.g., 4th-generation and below) aircraft. Fifth-generation fighters combine new developments such as thrust vectoring, composite materials, supercruise (the ability to cruise at supersonic speeds without using engine afterburners), stealth technology, advanced radar and sensors, and integrated avionics to greatly improve pilot situational awareness. Currently, only the Air Force F-22 air superiority fighter and the F-35 are considered fifthgeneration aircraft. Russia reportedly has a fifth-generation fighter under development. Strike fighters are dual-role tactical aircraft that are capable of both air-to-ground (strike) and air-to-air (fighter) combat (continued...) Congressional Research Service 1 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress that the three services could avoid the higher costs of developing, procuring, and operating and supporting three separate tactical aircraft designs to meet their similar but not identical operational needs.3 DOD states that the F-35 program “was structured from the beginning to be a model of acquisition reform, with an emphasis on jointness, technology maturation and concept demonstrations, and early cost and performance trades integral to the weapon system requirements definition process.”4 All three versions of the F-35 will be single-seat aircraft with supersonic dash capability and some degree of stealth. The three versions will vary somewhat in their combat ranges and payloads (see Appendix). All three are to carry their primary weapons internally to maintain a stealthy radar signature. Additional weapons can be carried externally. The Air Force states that: The F-35 program will develop and deploy a family of highly capable, affordable, fifth generation strike fighter aircraft to meet the operational needs of the Air Force, Navy, Marine Corps, and Allies with optimum commonality to minimize life cycle costs. The F-35 was designed from the bottom-up to be our premier surface-to-air missile killer and is uniquely equipped for this mission with cutting edge processing power, synthetic aperture radar integration techniques, and advanced target recognition. The F-35 also provides “leap ahead” capabilities in its resistance to jamming, maintainability, and logistic support.5 Air Force Version The Air Force is procuring the F-35A, a conventional takeoff and landing (CTOL) version of the aircraft. F-35As are to replace Air Force F-16 fighters and A-10 attack aircraft. The F-35A is intended to be a more affordable complement to the Air Force’s new F-22 Raptor air superiority fighter (which is replacing the service’s aging F-15 air superiority fighters.) Compared to the F22, the F-35A is not quite as stealthy and not as capable in air-to-air combat, but it is still very capable in both these areas, and is also very capable in air-to-ground combat. The F-35 is more stealthy and more capable in air-to-air and air-to-ground combat than the F-16. If the F-15/F-16 combination represented the Air Force’s earlier-generation “high-low” mix of air superiority fighters and more-affordable dual-role aircraft, then the F-22/F-35A combination might be (...continued) operations. 2 The program’s operational requirements call for 70% to 90% commonality between all three versions. Many of the three versions’ high-cost components—including their engines, avionics, and major airframe structural components— are common. 3 Secretary of Defense William Cohen stated in 2000 that the JSF’s joint approach “avoids the three parallel development programs for service-unique aircraft that would have otherwise been necessary, saving at least $15 billion.” (Letter from Secretary of Defense William S. Cohen to Rep. Jerry Lewis, June 22, 2000. The text of letter made available by Inside the Air Force on June 23, 2000.) 4 Department of Defense. Selected Acquisition Report (SAR)[for] F-35 (JSF), December 31, 2007, p. 4. 5 Department of the Air Force Presentation to the House Armed Services Committee Subcommittee on Air and Land Forces, United States House of Representatives, Subject: Air Force Programs, Combined Statement of: Lieutenant General Daniel J. Darnell, Air Force Deputy Chief Of Staff For Air, Space and Information Operations, Plans And Requirements (AF/A3/5) [and] Lieutenant General Mark D. Shackelford, Military Deputy, Office of the Assistant Secretary of the Air Force for Acquisition (SAF/AQ) Lieutenant General Raymond E. Johns, Jr., Air Force Deputy Chief of Staff for Strategic Plans And Programs (AF/A8) May 20, 2009, p. 10. Congressional Research Service 2 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress viewed as the Air Force’s intended future high-low mix of air superiority fighters and moreaffordable dual-role aircraft.6 The Air Force states that: Both the F-22A and the F-35 represent our latest generation of fighter aircraft. We need both aircraft to maintain the margin of superiority we have come to depend upon, the margin that has granted our forces in the air and on the ground freedom to maneuver and to attack. The F-22A and F-35 each possess unique, complementary, and essential capabilities that together provide the synergistic effects required to maintain that margin of superiority across the spectrum of conflict. The OSD-led 2006 QDR Joint Air Dominance study underscored that our Nation has a critical requirement to recapitalize TACAIR forces. Legacy 4th generation aircraft simply cannot survive to operate and achieve the effects necessary to win in an integrated, anti-access environment.7 The Department of the Navy states that: The commonality designed into the joint F-35 program will minimize acquisition and operating costs of Navy and Marine Corps tactical aircraft, and allow enhanced interoperability with our sister Service, the United States Air Force, and the eight partner nations participating in the development of this aircraft. This aircraft will give combatant commanders greater flexibility across the range of military operations. A true fifth generation aircraft, the F-35 will enhance precision strike capability through unprecedented stealth, range, sensor fusion, improved radar performance, combat identification and electronic attack capabilities compared to legacy platforms. It will also add sophisticated electronic warfare capabilities, as compared to the legacy platforms it will replace, and will tie together disparate units scattered across the battlefield, in real time.8 Marine Corps Version The Marine Corps is procuring the F-35B, a short takeoff and vertical landing (STOVL) version of the aircraft.9 F-35Bs are to replace Marine Corps AV-8B Harrier vertical/short takeoff and landing (VSTOL) attack aircraft and F/A-18A, C, and D strike fighters, which are CTOL aircraft. The F-35B and the V-22 Osprey tilt-rotor aircraft10 are central to achieving a long-term Marine 6 The term high-low mix refers to a force consisting of a combination of high-cost, high-capability aircraft and lowercost, more-affordable aircraft. Procuring a high-low mix is a strategy for attempting to balance the goal for having a certain minimum number of very high capability tactical aircraft to take on the most challenging projected missions and the goal of being able to procure tactical aircraft sufficient in total numbers within available resources to perform all projected missions. 7 Department of the Air Force Presentation to the House Armed Services Committee Subcommittee on Air and Land Forces, United States House of Representatives, Subject: Air Force Programs, Combined Statement of: Lieutenant General Daniel J. Darnell, Air Force Deputy Chief Of Staff For Air, Space and Information Operations, Plans And Requirements (AF/A3/5) [and] Lieutenant General Mark D. Shackelford, Military Deputy, Office of the Assistant Secretary of the Air Force for Acquisition (SAF/AQ) Lieutenant General Raymond E. Johns, Jr., Air Force Deputy Chief of Staff for Strategic Plans And Programs (AF/A8) May 20, 2009, pp. 7-8. 8 Statement of Vice Admiral David Architzel, USN, Principal Military Deputy, Research, Development and Acquisition, LTGEN George J. Trautman III, USMC, Deputy Commandant for Aviation, [and] RADM Allen G. Myers, USN, Director of Warfare Integration, Before the Seapower and Expeditionary Warfare [sic: Forces] Subcommittee of the House Armed Services Committee [hearing] on [the] Department of the Navy’s Aviation Procurement Program, May 19, 2009, p. 1. 9 To permit STOVL operations, the F-35B has an engine exhaust nozzle at the rear than can swivel downward, and a mid-fuselage lift fan connected to the engine that blows air downward to help lift the forward part of the plane. 10 For more on the V-22 program, see CRS Report RL31384, V-22 Osprey Tilt-Rotor Aircraft: Background and Issues for Congress, by Ronald O'Rourke. Congressional Research Service 3 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Corps goal for phasing out the service’s CTOL aircraft and fielding an all-VSTOL Marine Corps aviation capability. The Marine Corps decided to not procure F/A-18E/F strike fighters11 and instead wait for the F-35B in part because the F/A-18E/F is a CTOL aircraft. The Department of the Navy states that: The F-35B Short Take-off Vertical Landing (STOVL) variant combines the multi-role versatility and strike fighter capability of the legacy F/A-18 with the basing flexibility of the AV-8B. Having these capabilities in one aircraft will provide the joint force commander and the MAGTF [Marine Air-Ground Task Force] commander unprecedented strategic and operational agility. The Marine Corps’ tactical aviation (TACAIR) fixed-wing platforms, used for direct support to our ground combat Marines in the fight, are the AV-8B Harrier, the F/A-18 A+/C/D Hornet and the EA-6B Prowler. These aircraft are approaching the end of their planned service lives, and the Marine Corps, through careful service life extension programs, has managed these legacy platforms to bridge our aviation force until future airframes come on line. The Marines’ F-35B will replace both the AV-8B and F/A-18 A+/C/D, as well as fill a large portion of the EA-6B mission as part of a networked system of systems. The Marine Corps intends to leverage the F-35B’s sophisticated sensor suite and very low observable (VLO), fifth generation strike fighter capabilities, particularly in the area of data collection, to support the Marine Air Ground Task Force (MAGTF) well beyond the abilities of today’s strike and EW assets.12 Navy Version The Navy is procuring the F-35C, a carrier-suitable CTOL version of the aircraft.13 The F-35C is also known as the CV version of the F-35, with CV meaning aircraft carrier. The Navy in the future plans to operate carrier air wings featuring a strike fighter combination of F/A-18E/Fs (which the Navy has been procuring since FY1997) and F-35Cs. The F/A-18E/F is generally considered a fourth-generation strike-fighter. (Some F/A-18E/F supporters argue that it is a “fourth-plus” or “4.5”generation strike fighter because it incorporates some fifth-generation technology, particularly in its sensors.) The F/A-18E/F incorporates a few stealth features, but the F-35C is stealthier. The F/A-18E/F is less expensive to procure than the F-35C. In contrast to the Air Force, which has operated stealthy bombers and fighters for years, the F-35C is to be the Navy’s first considerably stealthy aircraft. The Department of the Navy states that: The F-35C carrier variant (CV) complements the F/A-18E/F Block II and EA-18G in providing survivable, long-range strike capability and persistence over the battlefield. The F- 11 For more on the F/A-18E/F program, see CRS Report RL30624, Navy F/A-18E/F and EA-18G Aircraft Procurement and Strike Fighter Shortfall: Background and Issues for Congress, by Ronald O'Rourke. 12 Statement of Vice Admiral David Architzel, USN, Principal Military Deputy, Research, Development and Acquisition, LTGEN George J. Trautman III, USMC, Deputy Commandant for Aviation, [and] RADM Allen G. Myers, USN, Director of Warfare Integration, Before the Seapower and Expeditionary Warfare [sic: Forces] Subcommittee of the House Armed Services Committee [hearing] on [the] Department of the Navy’s Aviation Procurement Program, May 19, 2009, pp. 1-2. 13 Features for carrier suitability include, among other things, strengthened landing gear, a strengthened airframe, and an arresting hook so as to permit catapult launches and arrested-wire landings, as well as folding wing tips for more compact storage aboard ship. Congressional Research Service 4 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress 35 will give the ESG and CSG commanders a survivable “Day-One” strike capability in a denied access environment that can not be accomplished by current legacy aircraft. 14 Engine The F-35 is powered by the Pratt and Whitney F135 engine, which was derived from the F-22’s Pratt and Whitney F119 engine. Consistent with congressional direction in 1996, DOD established an alternative engine program with the General Electric/Rolls-Royce Fighter Engine Team to develop the F136 engine as a second engine to compete with the F135 for JSF production and operations and support (O&S) contracts. The George W. Bush administration proposed terminating the alternate engine program in FY2007, FY2008, and FY2009,15 but Congress rejected these proposals and each year provided funding for the program’s continuation. Program Origin and Acquisition Milestones The JSF program began in the early- to mid-1990s.16 Three different designs for the aircraft were proposed by Boeing, Lockheed, and McDonnell Douglas (the last teamed with Northrop Grumman and British Aerospace). On November 16, 1996, the Defense Department announced that Boeing and Lockheed Martin had been chosen to compete in the Concept Demonstration Phase (CDP) of the program, with Pratt and Whitney providing propulsion hardware and engineering support. Boeing and Lockheed were each awarded contracts to build and test-fly two aircraft to demonstrate their competing concepts for all three planned JSF variants. The competition between Boeing and Lockheed Martin was closely watched: Given the size of the JSF program and the expectation that the JSF might be the last fighter aircraft program that DOD would initiate for many years, DOD’s decision on the JSF program was expected to shape the future of both U.S. tactical aviation and the U.S. tactical aircraft industrial base. 14 Statement of Vice Admiral David Architzel, USN, Principal Military Deputy, Research, Development and Acquisition, LTGEN George J. Trautman III, USMC, Deputy Commandant for Aviation, [and] RADM Allen G. Myers, USN, Director of Warfare Integration, Before the Seapower and Expeditionary Warfare [sic: Forces] Subcommittee of the House Armed Services Committee [hearing] on [the] Department of the Navy’s Aviation Procurement Program, May 19, 2009, p. 1. 15 See CRS Report RL33390, Proposed Termination of Joint Strike Fighter (JSF) F136 Alternate Engine, by Christopher Bolkcom. 16 The JSF program emerged in late 1995 from the Joint Advanced Strike Technology (JAST) program, which began in late 1993 as a result of the Clinton administration’s Bottom-Up Review (BUR) of U.S. defense policy and programs. The BUR envisaged the JAST program as a replacement for two other tactical aircraft programs that were being terminated (the A-12 program, which was intended to provide a stealthy new carrier-based attack plane to replace the Navy’s aging A-6 carrier-based attack planes, and the multi-role fighter [MRF], which was the Air Force had considered as a replacement for its F-16 fighters). In 1995, in response to congressional direction, a program led by the Defense Advanced Research Projects Agency (DARPA) to develop an advanced short takeoff and vertical landing (ASTOVL) aircraft was incorporated into the JAST program. This opened the way for Marine Corps and UK participation in the JAST program, since the Marine Corps and the UK were interested procuring a new STOVL aircraft to replace their aging Harrier STOVL attack aircraft. The name of the program was then changed to Joint Strike Fighter (JSF) to focus on joint development and production of a next-generation fighter/attack plane. A Joint Operational Requirements Document (JORD) for the F-35 program was issued in March 2000 and revalidated by DOD’s Joint Requirements Oversight Council (JROC) in October 2001. Congressional Research Service 5 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress In October 2001, DOD selected the Lockheed design as the winner of the competition, and the JSF program entered the System Development and Demonstration (SDD) phase. SDD contracts were awarded to Lockheed Martin (for the aircraft) and Pratt and Whitney (for the aircraft’s engine). General Electric continued technical efforts related to the development of a second engine source for competition in the program’s production phase. 17 The first flights of the F-35A and F-35B occurred in the first quarter of FY2007 and the third quarter of FY2008, respectively. 18 Under the FY2010 budget submission, the first flight of an optimized design for the F-35A (i.e., a slightly changed design for the F-35A) is scheduled for the third quarter of FY2009, and the first flight of the F-35C is scheduled for the first quarter of FY2010. The F-35A, F-35B, and F-35C are scheduled to achieve Initial Operational Capability (IOC) in March 2013, March 2012, and March 2015, respectively. Note that the scheduled IOC of the F-35B is a year earlier than that of the F-35A. Procurement Quantities Planned Total Procurement Quantities As of December 31, 2007, the F-35 program included a planned total of 2,456 aircraft—13 research and development aircraft and a planned total of 2,443 production aircraft. The 2,443 production aircraft include 1,763 F-35As for the Air Force and 680 F-35Bs and Cs for the Marine Corps and Navy, with exact numbers of Bs and Cs to be determined.19 These planned production totals are subject to review in the Quadrennial Defense Review (QDR) that is to be reported to Congress with the submission of the proposed FY2011 defense budget in February 2010. A June 3, 2009, press report states: Air Force Chief of Staff Norton Schwartz today signaled that the service’s requirement for 1,763 F-35 Joint Strike Fighters is being examined during the comprehensive Quadrennial Defense Review now under way. Whether the Air Force ultimately buys more or fewer F35s than planned depends on that review of military capabilities and requirements, the fourstar general told the House Defense Appropriations Subcommittee. Indeed, the Air Force’s plan to field a total of 2,250 fighters, both old and new, is also under review, according to Schwartz. 17 On October 24, 2001, the Defense Acquisition Board (DAB) held a Milestone B review for the program. (Milestone B approval would permit the program to enter the SDD phase.) On October 25, 2001, the Secretary of Defense certified to Congress (in accordance with Section 212 of the FY2001 defense authorization act [H.R. 4205/P.L. 106-398 of October 30, 2000]) that the program had successfully completed the CDP exit criteria and demonstrated sufficient technical maturity to enter SDD. On October 26, 2001, the SDD contracts were awarded to Lockheed and Pratt and Whitney. 18 A Preliminary Design Review (PDR) for the F-35 program was conducted in April 2003, and Critical Design Reviews (CDRs) were held for the F-35A, F-35B, and F-35C in February 2006 (F-35A and F-35B) and June 2007 (F35C). 19 In 1996, preliminary planning estimated over 3,000 F-35s for DOD and the UK: 2,036 for the Air Force, 642 for the Marines, 300 for the U.S. Navy, and 60 for the Royal Navy. In May 1997, the QDR recommended reducing projected DOD procurement from 2,978 to 2,852: 1,763 for the Air Force, 609 for the Marines, and 480 for the Navy. (Quadrennial Defense Review Cuts Procurement in FY1999, 2000, Aerospace Daily, May 20, 1997, p. 280.) In 2003, the Department of the Navy (DON) reduced its planned procurement of 1,089 F-35s to 680 aircraft as part of the Navy/Marine Corps Tactical Aviation Integration Plan. (See CRS Report RS21488, Navy-Marine Corps Tactical Air Integration Plan: Background and Issues for Congress, by Christopher Bolkcom and Ronald O'Rourke.) Congressional Research Service 6 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress “It could end up being less,” he said, adding, “if that’s the case, we will still have a predominately F-35” force. Still, Schwartz said he expects to have “well over” 1,500 F-35s.20 Annual Procurement Quantities Procurement of F-35s began in FY2007. Table 1 shows actual F-35 procurement quantities through FY2009 and requested procurement quantities for FY2010. The figures in the table do not include 13 research and development aircraft procured with research and development funding. Table 1. Annual F-35 Procurement Quantities (Figures shown are for production aircraft; table excludes 13 research and development aircraft) Type FY07 FY08 FY09 FY10 request F-35A (USAF) 2 6 7 10 F-35B (USMC) 0 6 7 16 F-35C (USN) 0 0 0 4 TOTAL 2 12 14 30 Source: Prepared by CRS based on DOD data. DOD plans have contemplated increasing the procurement rate of F-35As for the Air Force to a sustained rate of 80 aircraft per year by FY2015, and completing the planned procurement of 1,763 F-35As by about FY2034. DOD plans have also contemplated increasing the procurement rate of F-35Bs and Cs for the Marine Corps and Navy to a combined sustained rate of 50 aircraft per year by about FY2014, and completing the planned procurement of 680 F-35Bs and Cs by about FY2025. Program Management The JSF program is jointly staffed and managed by the Department of the Air Force and the Department of the Navy (DON). Service Acquisition Executive (SAE) responsibility alternates between the two departments. When the Air Force has SAE authority, the F-35 program director is from DON, and vice versa. The Air Force resumed SAE authority in April 2009.21 20 “Air Force Need For F-35s Under Review,” National Journal’s CongressDailyPM, June 3, 2009. 21 In 2004, appropriations conferees followed a House recommendation to direct DOD to review this alternative management arrangement. House appropriators believed that “management of program acquisition should remain with one Service, and that the U.S. Navy, due to its significant investment in two variants of the F-35 should be assigned all acquisition executive oversight responsibilities.” (H.Rept. 108-553 [H.R. 4613], p. 234) Conferees directed that DOD submit a report on the potential efficacy of this change. Prior to the release of the DOD report, former Air Force Chief of Staff General John Jumper was quoted as saying that he also supported putting one service in charge of JSF program acquisition. (Elizabeth Rees, “Jumper Supports Single Service Retaining JSF Acquisition Oversight,” Inside the Air Force, August 6, 2004.) However, General Jumper highlighted the significant investment the Air Force was making in the JSF program in response to the congressional language favoring the Navy. In DOD’s response to Congress, the report noted the current arrangement ensures one Service does not have a “disproportionate voice” when it comes to program decisions and that the current system is “responsive, efficient, and in the best interests of the success of the (continued...) Congressional Research Service 7 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress International Participation The F-35 program features a significant amount of international participation, making it DOD’s largest international cooperative program. Allied participation has been actively pursued by DOD as a way to defray some of the cost of developing and producing the aircraft, and to “prime the pump” for export sales.22 Allies in turn view participation the F-35 program as an affordable way to acquire a fifth-generation fighter, technical knowledge in areas such as stealth, and industrial opportunities for domestic firms. Eight allied countries—the United Kingdom, Canada, Denmark, The Netherlands, Norway, Italy, Turkey, and Australia—are participating in the F-35 program under Memoranda of Understanding (MOUs) in the SDD phase of the program and the Production, Sustainment and Follow-On Development (PSFD) phase of the program . These eight countries have contributed varying amounts of research and development funding to the program, receiving in return various levels of participation in the program. 23 International partners are also assisting with Initial Operational Test and Evaluation (IOT&E), a subset of SDD.24 The eight partner countries are expected to (...continued) JSF program.” (U.S. Department of Defense, Report to Congress on Joint Strike Fighter Management Oversight [forwarded by] Michael W. Wynne, Under Secretary of Defense for Acquisition, Technology and Logistics, December 20, 2004.) 22 Congress insisted from the outset that the JAST program include ongoing efforts by DARPA to develop more advanced STOVL aircraft, opening the way for UK participation in the program. 23 International participation in the F-35 program is divided into three levels, according to the amount of money a country contributes to the program—the higher the amount, the greater the nation’s voice with respect to aircraft requirements, design, and access to technologies gained during development. The UK is the only “Level 1” partner, contributing approximately $2 billion to the SDD phase. UK participation began at the outset of the F-35 program. On December 20, 1995, the U.S. and UK governments signed an MOU on UK participation in the F-35 program as a collaborative partner in the definition of requirements and aircraft design. This MOU committed the UK government to contribute $200 million toward the cost of the 1997-2001 Concept Demonstration Phase. (“U.S., U.K. Sign JAST Agreement,” Aerospace Daily, December 21, 1995, p. 451.) On January 17, 2001, the United States and United Kingdom finalized the UK’s SDD participation, which equated to approximately 8% of the total SDD phase. Many UK firms, such as British Aerospace and Rolls-Royce, have strong participation in the program. Level II partners consist of Italy and the Netherlands, contributing $1 billion and $800 million, respectively. On June 24, 2002, Italy became the senior Level II partner. (“F-35 Joint Strike Fighter (JSF) Lightning II: International Partners,” http://www.globalsecurity.org/military/systems/aircraft/f-35-int.htm, accessed on October 3, 2007.) Italy wants to have its own F-35 final assembly line, which would be in addition to a potential F-35 maintenance and upgrade facility. The Netherlands signed on to the F-35 program on June 17, 2002, after it had conducted a 30-month analysis of potential alternatives. Australia, Denmark, Norway, Canada, and Turkey joined the F-35 program as Level III partners, with contributions ranging from $125 million to $175 million. (“Australia, Belgium Enter Joint Strike Fighter Program as EMD Partners,” Inside the Air Force, April 21, 2000.) Unlike the SDD phase, PSFD phase does not make any distinction as to levels of participation. Also unlike the bilateral SDD MOUs, there is a single PSFD MOU for all partner nations. In signing the PSFD MOU, partner nations state their intentions to purchase the F-35, including quantity and variant, and a determination is made as to their delivery schedule. PSFD costs will be divided on a “fair-share” based on the programmed purchase amount of the respective nation. So-called “offset” arrangements, considered the norm in defense contracts with foreign nations, usually require additional incentives to compensate the purchasing nation for the agreement’s impact to its local workforce. F-35 officials decided to take a different approach, in line with the program’s goal to control costs, to avoid offset arrangements and promote competition as much as possible. Consequently, all partner nations have agreed to compete for work on a “best-value” basis and have signed the PSFD MOU. 24 Currently, the UK, Italy, and the Netherlands have agreed to participate in the IOT&E program. UK, the senior F-35 partner, will have the strongest participation in the IOT&E phase. Italy and the Netherlands are contributing a far smaller amount and will take part only in the coalition concept of operations (CONOPS) validation testing. (Telephone (continued...) Congressional Research Service 8 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress purchase more than 700 hundred F-35s, with the United Kingdom being the largest anticipated foreign purchaser.25 Two additional countries—Israel and Singapore—are security cooperation participants outside the F-35 cooperative development partnership, 26 and sales to additional countries are possible.27 Some officials have speculated that foreign sales of F-35s might eventually surpass 3,000 aircraft.28 For several years, press reports have indicated that a number of partner nations have threatened to withdraw from the program because of frustrations over workshare and technology transfer issues.29 To more effectively negotiate the terms of their involvement, some European F-35 partners reportedly are attempting to team with others and present a more united position vis-a-vis Lockheed. 30 Cost and Funding Sources of Funding The F-35 program has received or currently receives funding from: • the Air Force, Navy, and Defense-Wide research, development, test, and evaluation (RDT&E) accounts;31 • additional research and development funding from Non-Treasury Funds (i.e., financial contributions from the eight other countries participating in the F-35 program); (...continued) conversation with OSD/AT&L, October 3, 2007.) Other partner nations are still weighing their option to participate in the IOT&E program. The benefits to participation are expedited acquisition of aircraft, pilot training for the test cycle, and access to testing results. 25 Anticipated orders are as follows: UK: 138; Italy: 131; Australia: 100; Turkey: 100; Canada: 88; Netherlands: 85; Denmark: 48; Norway: 48. (Michael Sirak, “F-35 Nations on Track to Sign New MOU, Says JSF Program Office,” Defense Daily, November 20, 2006.) 26 DOD offers Foreign Military Sales (FMS)-level of participation in the F-35 program for countries unable to commit to partnership in the program’s SDD phase. Israel and Singapore are believed to have contributed $50 million each, and they are “Security Cooperative Participants.” (Selected Acquisition Report. Office of the Secretary of Defense for Acquisition. December 31, 2005.) In October 2008, it was reported that the Bush administration had authorized sale of the F-35 to Israel. (Caitlin Harrington. “US approves F-35 sale to Israel.” Jane’s Defense Weekly. October 1, 2008) and that Tel Aviv was prepared to spend as much as $15 billion to procure 25 F-35s. (“Israel Looks to Spend $15 Billion for CTOL Variant of F-35.” Defense Daily. October 1, 2008.) 27 F-35 program officials have discussed the aircraft with the defense staffs of many other allied countries as prospective customers, including Germany, Greece, and Spain. 28 See, for example, Marina Malenic, “F-35 Sales Could Double As Countries Look To Replace Aging Fleets, General Says,” Defense Daily, June 18, 2009: 6. 29 See “Norway Signs Industrial Partnership with Eurofighter Consortium,” Defense Daily, January 29, 2003; Joris Janssen Lok, “Frustration Mounts Among JSF Partners,” Jane’s Defense Weekly, March 24, 2004; Thomas Dodd, “Danish Companies Consider Quitting JSF Programme,” Jane’s Defence Weekly, January 9, 2004; Tom Kingston, “Unsatisfied Italy May Cut JSF Participation,” Defense News, May 10, 2004; Lale Sariibrahimoglu, “Turkey may withdraw from JSF program,” Jane’s Defence Weekly, November 10, 2004. 30 Tom Kington. “Italy Pushes for Europeanized JSF.” Defense News. October 13, 2008. 31 The Defense-Wide RDT&E funding occurred in FY1996-FY1998. Congressional Research Service 9 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress • procurement funding from the Air Force and Navy aircraft procurement accounts,32 and • MilCon funding from the Air Force MilCon account and the Navy and Marine Corps MilCon account. Estimated Total Program Acquisition Cost and Prior-Year Funding As of December 31, 2007, the total estimated acquisition cost (the sum of development cost, procurement cost, and military construction [MilCon] cost) of the F-35 program in constant (i.e., inflation-adjusted) FY2009 dollars was about $246 billion, including about $47.1 billion in research and development costs, about $198.4 billion in procurement costs, and about $496 million in MilCon costs.33 In then-year dollars (meaning dollars from various years that are not adjusted for inflation), the figures from the preceding paragraph become $298.8 billion in acquisition costs, including $44.4 billion in research and development costs, $254.0 billion in procurement costs, and about $521 million in MilCon costs. Like several other DOD acquisition programs, the JSF has experienced cost growth (and also schedule slippage). Since 2002, the total estimated acquisition cost of the F-35 program has increased by roughly $100 billion due primarily to a one-year extension in the program’s SDD phase, a corresponding one-year delay in the start of procurement (from FY2006 to FY2007), revised annual quantity profiles, and revised labor and overhead rates. Much of this increased cost and schedule slippage was incurred to address weight-driven performance issues in the development of the F-35B. Through FY2009, the F-35 program has received a total of roughly $44 billion funding in thenyear dollars, including roughly $37 billion in research and development funding, about 6.9 billion in procurement funding, and roughly $150 million in MilCon funding. Estimated Unit Costs The F-35 program as of December 31, 2007 had a program acquisition unit cost (or PAUC, meaning total acquisition cost divided by the 2,456 research and development and procurement aircraft) of about $100.1 million in constant FY2009 dollars, and an average procurement unit cost (or APUC, meaning total procurement cost divided by the 2,443 production aircraft) of about $81.2 million in constant FY2009 dollars. Between October 2001 and December 2007, the constant-dollar PAUC and APUC figures have each grown by about 38%. 32 The Navy and Marine Corps are organized under the Department of the Navy, and Marine Corps aircraft development and procurement costs are funded through the Navy’s RDT&E and aircraft procurement accounts. 33 The procurement cost figure of about $198.4 billion does not include the cost of several hundred additional F-35s that are to be procured other countries that are participating in the F-35 program. The $198.4-billion figure does, however, assume certain production-cost benefits for DOD aircraft that result from producing these several hundred additional F-35s for other countries. Congressional Research Service 10 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Manufacturing Locations Current plans call for the F-35 to be manufactured in several locations. Lockheed will build the aircraft’s forward section in Fort Worth, TX. Northrop will build the mid-section in Palmdale, CA, and the tail will be built by BAE Systems in the United Kingdom. Final assembly of these components will take place in Fort Worth. Italy in 2007 reportedly was working with Lockheed and the F-35 program office on the potential of establishing a second final assembly and checkout facility in Italy. 34 Proposed FY2010 Budget FY2010 Funding Request Table 2 shows the administration’s FY2010 request for Air Force and Navy research and development and procurement funding for the F-35 program, along with FY2008 and FY2009 funding levels. The funding figures shown in the table do not include procurement funding for initial spares, MilCon funding, or research and development funding provided by other countries. Table 2. FY2010 Funding Request for F-35 Program (Figures in millions of then-year dollars; FY2008 and FY2009 figures shown for reference; figures shown do not include procurement funding for initial spares, MilCon funding, or research and development funding provided by other countries;) FY2008 FY2009 FY2010 (request) Funding Quantity Funding Quantity Funding Quantity Air Force 1,939.1 — 1,734.3 — 1,858.1 — Dept. of Navy 1,848.9 — 1,744.6 — 1,741.3 — Subtotal 3,788.0 — 3,478.9 — 3,599.4 — RDT&E funding Procurement funding Air Force 1,412.1 6 1,660.6 7 2,349.4 10 Dept. of Navy 1,223.6 6a 1,650.1 7b 4,478.0 20c Subtotal 2,635.7 12 3,310.7 14 6,827.5 30 TOTAL 6,423.7 12 6,789.6 14 10,426.9 30 Source: Prepared by CRS based on DOD data. Figures shown do not include procurement funding for initial spares, MilCon funding,, or research and development funding provided by other countries. Air Force funding for initial spares was $69.8 million in FY2008 and $60.9 million in FY2009, and $129.7 million is requested for FY2010. Department of the Navy funding for initial spares was zero in FY2008 and $32.7 million in FY2009, and $249.0 million is requested for FY2010. International partner funding for research and development was $552.7 million in FY2008 and $250.6 million in FY2009, and is projected to be $114.1 million in FY2010. 34 Michael Sirak, “F-35 Program May Get First International Orders In Third Production Lot in 2009,” Defense Daily International, June 22, 2007. Congressional Research Service 11 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress a. All 6 aircraft are F-35Bs for the Marine Corps. b. All 7 aircraft are F-35Bs for the Marine Corps. c. Includes 16 F-35Bs for the Marine Corps and 4 F-35Cs for the Navy. The 10 F-35As requested for FY2010 in the Air Force budget have an estimated procurement cost of $2,220.3 million, or an average of $222.0 million each. These aircraft have received $171.4 million in prior-year advance procurement (AP) funding, leaving another $2,048.8 million to be funded in FY2010 to complete their estimated procurement cost. The FY2010 Air Force procurement funding request for the F-35 program also includes $300.6 million in advance procurement funding for 27 F-35As to be procured in future years, and $129.7 million for F-35A initial spares, bringing the total FY2010 Air Force procurement funding request for the program to $2,479.1 million. (Table 2 does not include funding for initial spares, which is why it shows a total of $2,349.4 million.) The 16 F-35Bs and four F-35Cs requested for FY2010 in the Department of the Navy budget have a combined estimated procurement cost of $4,212.1 million, or an average of $210.6 million each. These aircraft have received $215.0 million in prior-year AP funding, leaving another $3,997.0 million to be funded in FY2010 to complete their estimated procurement cost. The FY2010 Department of the Navy procurement funding request for the F-35 program also includes $481.0 million in advance procurement funding for F-35Bs and Cs to be procured in future years, and $249.0 million for F-35A initial spares, bringing the total FY2010 Air Force procurement funding request for the program to $4,727.0 million. (Table 2 does not include funding for initial spares, which is why it shows a total of $4,478.0 million.) Proposed Termination of Alternate Engine Program The administration’s proposed FY2010 budget proposes terminating the F-35 alternate engine program. Issues For Congress Alternate Engine A key issue for Congress for the F-35 program in FY2010 is the administration’s proposal to terminate the F-35 alternate engine program, which is intended to develop the General Electric/Rolls-Royce F136 engine as an alternative to the Pratt and Whitney F135 engine that currently powers the F-35. As mentioned earlier, the George W. Bush administration proposed terminating the alternate engine program in FY2007, FY2008, and FY2009, but Congress rejected these proposals and each year provided funding for the program’s continuation. Summary of Arguments For and Against Termination Supporters of the administration’s proposal to terminate the alternate engine program argue the following: • Development, testing, and production of the F135 have reached the point where it is no longer necessary to hedge against the possibility of technical problems in Congressional Research Service 12 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress the F135 engine by pursing an alternate engine program as a backup. The causes of F135 test failures in 2007 and 2008 have been identified and fixes are being implemented. • Developing and procuring a second engine for the F-35 would add billions of dollars to the cost of the F-35 program by doubling engine development costs and halving engine production economies of scale, reducing the number of F-35s that could be procured within a given total mount of F-35 acquisition funding. • Procuring a second engine for the F-35 would increase F-35 life-cycle operation and support (O&S) costs by requiring DOD to maintain two F-35 engine maintenance and repair pipelines. Opponents of the administration’s proposal to terminate the alternate engine program argue the following: • Given that F-35s in the future are to constitute the vast majority of the country’s strike fighters, and in light of F135 test failures in 2007 and 2008, it would be imprudent to have all those strike fighters powered by a single type of engine, since a problem with that engine could force the grounding of the entire F-35 fleet. • Having a second engine in production (or ready for production) would permit DOD to use competition (or the threat of competition) in procuring and supporting F-35 engines, which will reduce F-35 engine procurement and O&S costs compared to what would be achievable in a sole-source procurement, offsetting the additional costs associated with developing, procuring, and supporting a second engine. Competition (or the threat of competition) would also promote better engine performance, increased engine reliability, and improved contractor responsiveness. • Having two F-35 production lines in operation would permit F-35 engine production to quickly surged to higher levels if needed to respond to a change in the strategic environment, and preserve a potential for maintaining effective competition in the development and procurement of future tactical aircraft engines, particularly if F-22 and F/A-18E/F production ends. Administration Perspective An Office of Management and Budget (OMB) document on proposed FY2010 program terminations, reductions, and savings states that: The Administration has decided not to fund the Joint Strike Fighter (JSF) Alternative Engine Program (AEP), because it is no longer needed as a hedge against the failure of the main Joint Strike Fighter engine program. The Department of Defense (DOD) proposed cancelling the JSF AEP in the President’s 2007 Budget because development of the main engine was progressing well and analysis indicated that savings from competition would not be offset by high upfront costs. DOD did not request funding for the program in the 2008 and 2009 Budgets. However, the Congress has rejected the proposed cancellations and has added funding each year since 2007 to sustain the AEP development.... Because DOD wanted to reduce technical risk in the development of the JSF engine, the Department has had two contractors developing separate JSF engines. However, in 2007, Congressional Research Service 13 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress DOD proposed to cancel the contract for the second (alternate) engine because the main engine program was progressing well, making a second engine program unnecessary. Moreover, financial benefits, such as savings from competition, have been assessed to be small, if they exist at all, because of the high cost of developing, producing and maintaining a second engine. The reasons for canceling the AEP in 2007 remain valid today. Studies by both the Government Accountability Office and Congressional Budget Office have questioned the affordability of the current defense program, particularly the high cost of modernizing tactical aviation.35 Canceling the AEP will result in estimated near-term savings of over a billion dollars.36 At a May 20, 2009, hearing before the Air and Land Forces subcommittee of the House Armed Services Committee on Air Force acquisition programs, a DOD acquisition official stated: The F-35 acquisition strategy contains provisions for a competitive engine program, provided funds are available to execute that strategy. Currently, the F135 engine is completing the development phase and beginning initial low rate production to support the F-35 aircraft production and test schedule. The F135 experienced two separate low pressure turbine blade failures, the first in the September 2007 and the second in February 2008. Root cause analysis determined the problem. The appropriate fixes were identified and are being incorporated into the remaining test and all future production engines. The engines were certified for Short Take-Off and Vertical Landing testing in January 2009, and the program recently completed hover pit testing as it prepares for full vertical landing flight tests later this year. The Department did not include funding in the Fiscal Year 2010 President’s Budget for the F136 competitive engine. The decision to not include funding for the F136 is consistent with the Department’s position on this issue for the prior three budget submissions. The decision this year was reviewed by the Department’s leadership as well as the Administration. The determination of whether to fund the competitive engine, as it has in the past, was weighed against the budget priorities of the Department as a whole, the optimum use of taxpayer’s dollars in executing and preparing for the National defense, and the benefits to the F-35 program. The Department continues to execute appropriated development funding to ensure that a competitive engine program remains viable while there is funding is available. Since there is no follow-on procurement funding in Fiscal Year 2010, the Department has delayed execution of advance procurement funding appropriated in the Fiscal Year 2009 Appropriations Act. The Department’s policy is to execute advance procurement funds only when associated follow-on procurement funding or a programmed plan that contains full procurement funding is available.37 At the same hearing, Air Force officials stated the following: Presidential Budget 10, released earlier this month, cancelled the alternate engine program for the Joint Strike Fighter, and removed all further funding for the development and 35 The passage at this point has a footnote citing the following two reports: Government Accountability Office, Defense Acquisitions[:] Assessments of Selected Weapon Programs, GAO-09-326SP, March 2009; and Congressional Budget Office, Long Term Implications of the Fiscal Year 2009 Future Years Defense Program, January 2009. 36 Office of Management and Budget. Terminations, Reductions, and Savings, Budget of the U.S. Government, Fiscal Year, 2010. Washington, May 2009. p. 38. 37 Statement of Mr. David G. Ahern, Director, Portfolio Systems Acquisition, Office of the Under Secretary of Defense (Acquisition, Technology, and Logistics), Before the House Armed Services Committee Subcommittee on Air and Land Forces, May 20, 2009, pp. 6-7. Congressional Research Service 14 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress procurement of this second engine. The Air Force and Navy are executing the funding appropriated by Congress in the 2009 budget to continue the F136 program. The cost to continue F136 engine development is approximately $1.8B through FY15. In addition, the Department of Defense will have to fund the production of GE engines to get the suppliers on equal footing in the amount of approximately $2.8B. Continued funding for the F136 engine carries cost penalties to both F135 and F136 engines for reduced production line learning curves and inefficient economic order quantities. The department has concluded that maintaining a single engine supplier provides the best balance of cost and risk. Our belief is the risks associated with a single source engine supplier are manageable due to improvements in engine technology and do not outweigh the investment required to fund a competitive alternate engine.38 GAO Perspective At a May 20, 2009, hearing before the Air and Land Forces subcommittee of the House Armed Services Committee on Air Force acquisition programs, GAO testified on the F-35 program, stating in the testimony’s summary that: The department [i.e., DOD] has not asked for funding for the alternate engine program in the budgets since 2007 arguing that an alternate engine is not needed as a hedge against the failure of the main engine program and that the savings from competition would be small. Nonetheless, the Congress has added funding each year since then to sustain its development. Our prior analysis indicates that competitive pressures could yield enough savings to offset the costs of competition over the JSF program’s life. To date, the two contractors have spent over $8 billion on engine development—over $6 billion with the main engine contractor and over $2 billion with the second source contractor.39 Elaborating on this summary statement, the testimony stated the following: DOD’s Proposal to Cancel the Alternate Engine Program May Bypass Long-term Merits DOD and the Congress have had a continuing debate for several years on the merits of an alternate engine program to provide a second source and competition for engine procurement and life cycle support. The alternate engine program was part of the original JSF acquisition strategy. The department first proposed canceling the alternate engine program in the 2007 budget and has not asked for funding in the budgets since then. The administration does not believe an alternate engine is needed as a hedge against the failure of the main engine program and believes savings from competition would be small. The Congress has added funding each year since 2007 to sustain the alternate engine development, including $465 million for fiscal year 2009. To date, the two contractors have spent over $8 billion on 38 Department of the Air Force Presentation to the House Armed Services Committee Subcommittee on Air and Land Forces, United States House of Representatives, Subject: Air Force Programs, Combined Statement of: Lieutenant General Daniel J. Darnell, Air Force Deputy Chief Of Staff For Air, Space and Information Operations, Plans And Requirements (AF/A3/5) [and] Lieutenant General Mark D. Shackelford, Military Deputy, Office of the Assistant Secretary of the Air Force for Acquisition (SAF/AQ) Lieutenant General Raymond E. Johns, Jr., Air Force Deputy Chief of Staff for Strategic Plans And Programs (AF/A8) May 20, 2009, p. 11. 39 Government Accountability Office, Joint Strike Fighter[:]Strong Risk Management Essential as Program Enters Most Challenging Phase, Statement of Michael Sullivan, Director Acquisition and Sourcing Management. GAO-09711T, May 20, 2009, summary page. Congressional Research Service 15 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress engines development—over $6 billion with the main engine contractor and over $2 billion with the second source contractor. The way forward for the JSF engine acquisition strategy entails one of many critical choices facing DOD today, and underscores the importance of decisions facing the program. As we noted in past testimonies before this committee, the acquisition strategy for the JSF engine must weigh expected costs against potential rewards. In each of the past 2 years we have testified before this committee on the merits of a competitive engine program for the Joint Strike Fighter.40 While we did not update our analysis we believe it is still relevant and the same conclusions can be drawn. We reported in 2008 that to continue the JSF alternate engine program, an additional investment of about $3.5 billion to $4.5 billion in development and production-related costs, may be required to ensure competition.41 Our earlier cost analysis suggests that a savings of 9 to 11 percent would recoup that investment. As we reported last year, a competitive strategy has the potential for savings equal to or exceeding that amount across the life cycle of the engine. Prior experience indicates that it is reasonable to assume that competition on the JSF engine program could yield savings of at least that much. As a result, we remain confident that competitive pressures could yield enough savings to offset the costs of competition over the JSF program’s life. However, we recognize that this ultimately will depend on the final approach for the competition, the number of aircraft actually purchased, and the ratio of engines awarded to each contractor. Results from past competitions provide evidence of potential financial and nonfinancial savings that can be derived from engine programs. One relevant case study to consider is the “Great Engine War” of the 1980s—the competition between Pratt & Whitney and General Electric to supply military engines for the F-16 and other fighter aircraft programs. At that time, all engines for the F-14 and F-15 aircraft were being produced on a sole-source basis by Pratt & Whitney, which was criticized for increased procurement and maintenance costs, along with a general lack of responsiveness to government concerns about those programs. For example, safety issues with the single-engine F-16 aircraft were seen as having greater consequences than safety issues with the twin-engine F-14 or F-15 aircraft. To address concerns, the Air Force began to fund the development and testing of an alternate engine to be produced by General Electric; the Air Force also supported the advent of an improved derivative of the Pratt & Whitney engine. Beginning in 1983, the Air Force initiated a competition that Air Force documentation suggests resulted in significant cost savings in the program. In the first 4 years of the competition, when actual costs are compared to the program’s baseline estimate, results included (1) nearly 30 percent cumulative savings for acquisition costs, (2) roughly 16 percent cumulative savings for operations and support costs; and (3) total savings of about 21 percent in overall life cycle costs. The Great Engine War was able to generate significant benefits because competition incentivized contractors to improve designs and reduce costs during production and sustainment. Competitive pressure continues today as the F-15 and F-16 aircraft are still being sold internationally. While other defense competitions resulted in some level of 40 The passage at this point has a footnote citing the following two prior instances of GAO testimony: Government Accountability Office, Joint Strike Fighter[:] Impact of Recent Decisions on Program Risks, Statement of Michael Sullivan, Director Acquisition and Sourcing Management, Testimony before the Subcommittees on Air and Land Forces, and Seapower and Expeditionary Forces, Committee on Armed Services, House of Representatives, GAO-08569T, March 11, 2008; and Government Accountability Office, Defense Acquisitions[:]Analysis of Costs for the Joint Strike Fighter Engine Program, Statement of Michael Sullivan, Director Acquisition and Sourcing Management, Testimony before the Subcommittees on Air and Land Forces, and Seapower and Expeditionary Forces, Committee on Armed Services, House of Representatives, GAO-07-656T, March 22, 2007. 41 The passage at this point has a footnote stating: “Since that time, Congress appropriated $465 million in the fiscal year 2009 budget to continue the alternate engine program.” Congressional Research Service 16 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress benefits, especially with regard to contractor responsiveness, they did not see the same levels of success absent continued competitive pressures. Similar competition for the JSF engines may also provide benefits that do not result in immediate financial savings, but could result in reduced costs or other positive outcomes over time. Our prior work, along with studies by DOD and others, indicate there are a number of nonfinancial benefits that may result from competition, including better performance, increased reliability, and improved contractor responsiveness. In addition, the long-term effects of the JSF engine program on the global industrial base go far beyond the two competing contractors. DOD and others have performed studies and have widespread concurrence as to these other benefits, including better engine performance, increased reliability, and improved contractor responsiveness. In fact, in 1998 and 2002, DOD program management advisory groups assessed the JSF alternate engine program and found the potential for significant benefits in these and other areas. Table 2 summarizes the benefits determined by those groups. Table 2: 1998 and 2002 Program Management Advisory Group Study Findings on the Benefits of an Alternate Engine Program Beneficial Factor assessed 1998 Marginal 2002 Costs No Value 1998 2002 X X Development risk reduction Engine growth potential X Fleet readiness X X Industrial base X X Int’l implications X X Other considerationsd X X Overall X X 1998 2002 X X X Source: GAO analysis of DOD data. d. Other considerations include contractor responsiveness, improved design solutions, and competition at the engine subsystem level. While the benefits highlighted may be more difficult to quantify, they are no less important, and ultimately were strongly considered in recommending continuation of the alternate engine program. These studies concluded that the program would maintain the industrial base for fighter engine technology, enhance readiness, instill contractor incentives for better performance, ensure an operational alternative if the current engine developed problems, and enhance international participation. Another potential benefit of having an alternate engine program, and one also supported by the program advisory groups, is to reduce the risk that a single point systemic failure in the engine design could substantially affect the fighter aircraft fleet. This point is underscored by recent failures of the Pratt & Whitney test program. In August 2007, an engine running at a test facility experienced failures in the low pressure turbine blade and bearing, which Congressional Research Service 17 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress resulted in a suspension of all engine test activity. In February 2008, during follow-on testing to prove the root cause of these failures, a blade failure occurred in another engine, resulting in delays to both the Air Force and Marine Corps variant flight test programs. 42 Press Reports A June 1, 2009, press report states: Funding development of a second engine from within the existing F-35 budget would cut production by dozens of aircraft and push up program costs, the Joint Strike Fighter’s program chief warns in an interview with Aviation Week. The concerns come as Congress is expected to reverse the White House and Pentagon’s effort to cancel the alternate powerplant. Forcing the program to fund development of the General Electric/Rolls-Royce F136 from within the existing JSF budget would “take 50-80 tails out of the program” over the next five years, says the program executive officer (PEO), Marine Corps Brig. Gen. David Heinz. The Defense Department’s fiscal 2010 budget request calls for procurement of 513 F-35s over five years, an increase of 25 over previous plans, with another 180 expected to be built for international partners over the same period. This would take annual production “into the low 200s” by FY ‘15, he says. Funding the F136 within the existing budget would require cutting six aircraft from the 30 planned in FY ‘10, Heinz says. This would make aircraft in subsequent years more expensive, pushing back international purchases and compounding the problem because the partners could not afford early aircraft, he says. “We would never get to 200 tails [a year]. We would build out to around 100, under-utilize the tooling and not get down the learning curve,” the PEO says. “I worry about taking tails out of the program because it will get so expensive the partners will start to pull back.” Pentagon leadership has not sought to continue the F136, arguing DOD can only afford the Pratt & Whitney F135 primary engine. But Congress is expected to reinstate the funding. Lawmakers, with widespread consensus, have ignored the cancellation effort for years and earmarked money for the alternate. But before, some of the restored funding has come from within the existing JSF budget, forcing cuts elsewhere in the program. Former U.S. Air Force leaders have testified on Capitol Hill that they didn’t so much oppose an alternate engine as they did sacrificing elsewhere to fund it (Aerospace DAILY, March 7, 2008). The GE/R-R Fighter Engine Team has defended its lobbying for the F136. “We’ve never advocated taking the money out of the other parts of the program. Congress needs to decide where the money comes from,” says Dennis Jarvi, president of Rolls-Royce North America Defense. 42 Government Accountability Office, Joint Strike Fighter[:]Strong Risk Management Essential as Program Enters Most Challenging Phase, Statement of Michael Sullivan, Director Acquisition and Sourcing Management. GAO-09711T, May 20, 2009, pp. 4-7. Congressional Research Service 18 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress The international partners would like a competing engine, and Pentagon efforts to kill the F136 are “sure to be a major topic” when they meet in Washington later this month, says Tom Burbage, Lockheed executive vice-president and general manager, F-35 program integration. “There is support in the international community for the second engine,” he tells Aviation Week. Burbage says the second-engine issue is “programmatically complex” because, while Congress has incrementally funded development of the F136, the Defense Dept. has not factored production of two engines into its budget planning and not decided how it would conduct an annual leader/follower competition. “It’s the clear intent of Congress to have a second engine, but it could have a very substantial impact,” he says. 43 A June 3, 2009, press report states: The top Joint Strike Fighter official says he unequivocally supports President Barack Obama’s fiscal 2010 budget request, which does not seek funds for a second JSF engine— but he is still planning for the F136 and suggests Washington consider the risk otherwise. Citing the potential for “competitive advantage” from alternate engines for the single-engine F-35, and noting that there could be an operational risk some day from having just one engine, Marine Corps Brig. Gen. David Heinz told reporters at the JSF Joint Program Office June 2 that there might be considerations beyond the financial cost of funding dual powerplant efforts. “Do we still believe that’s acceptable?” Heinz asked rhetorically. Meantime, the general—selected for his second star after his promotion from deputy program chief—says it would be irresponsible for him not to plan for both engine efforts. “I have to,” he asserts, adding it would be “downright reckless” not to after Congress has earmarked funds for the second engine several times already. And besides, military officials spend a lot of their time planning for things that do not happen, he joked. Heinz explained to the roundtable of reporters that funding development of a second engine from within the existing F-35 budget would cut production by 50 or more aircraft and push up program costs—a point he made to Aviation Week last week (Aerospace DAILY, May 29). But the program executive officer also stressed that economic modeling was difficult, and that a competition for the engines would likely drive down costs. Heinz further asserted that the primary Pratt & Whitney F135 engine has yet to truly compete with the General Electric/Rolls-Royce F136, regardless of what Pratt and some supporters may suggest. Assuming the program’s planned ramp-up and a 50-50 split engine order during the sixth low-rate initial production tranche, fiscal 2013 would be the first genuine year of the rivalry. Such a race could bring technology advancements too, the general notes. “They are just beginning in that competition,” he says. 43 Graham Warwick and Guy Norris, “Second Engine Could Force F-35 Production Cuts, PEO Warns,” Aerospace Daily & Defense Report, June 1, 2009: 3. Congressional Research Service 19 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Elsewhere, Heinz said authorities are trying to track down and prosecute those responsible for a cyber breach of the program a few years ago, recently highlighted in news reports. He would not comment further, saying all the publicity does not necessarily help that effort. “We are trying to actually capture a few of these individuals,” he says. 44 A June 8, 2009, press report states: The new general in charge of the F-35 Joint Strike Fighter program last week told reporters the Defense Department must weigh the operational risks of having a single engine program for the fifth-generation jet rather than solely looking at the cost implications of procuring two power plants. The F-35 Lightning II was conceived to be developed with two engines, the Pratt & Whitney F135 and the General Electric-Rolls-Royce F136. However, DOD in recent years—including in its budget request for fiscal year 2010—has zeroed funding for the second power plant. Each year, Congress has reintroduced full funding for the F136 in its markups of the defense budget. “I support the president’s budget, but in the future, should there be an engine incident on the F135 motor, our ability to absorb an incident that may ground a large number of those motors ... is going to lessen,” Marine Corps Brig. Gen. David Heinz said during a June 2 briefing at the JSF program office in Arlington, VA, noting that the F-35 will eventually replace a number of legacy jets, including the F-15 Eagle, the F-16 Viper, the F/A-18 Hornet and the AV-8B Harrier II. As such, the military will not have the operational flexibility it has today if an engine problem leads to the grounding of the F-35 fleet with a single engine, Heinz added. “I believe part of the debate that has to occur and is occurring is, ‘Is there an operational risk that we are accepting by having just one engine manufactured?’” he said. “I simply think we focus too much on the discussion about cost benefit and not operational risk benefit.” Heinz also continued the rhetoric of his predecessor—Air Force Maj. Gen. Charles Davis— that the true cost savings of having two engines competing in the program have yet to be revealed. In the 1980s engine wars, per-unit costs reductions reached 20 percent due to competition, he noted. “I think that, because of the difference in the development time line, that [the competition] has not yet occurred,” the Marine Corps one-star said. “Pratt is not truly competing with GE yet for the market share, because I only have Pratt engines through [low-rate initial production]-3. We’re going to introduce—if Congress fully funds in the [fiscal year 2010] budget—four GE motors, but that’s four out of 30 motors that we’ll buy next year, so they’re just beginning in that competition. I do not believe yet that Pratt feels compelled as though they are in competition with GE.” DOD last week awarded JSF prime contractor Lockheed Martin a $2 billion contract to produce 17 LRIP-3 F-35s. The lot includes the first international orders—two operational test aircraft for the United Kingdom and one for the Netherlands. In March and April, Lockheed received $306 million to prepare production for 32 LRIP-4 aircraft. When the competition truly heats up between Pratt and the GE-Rolls-Royce Fighter Engine team, Heinz said there will be “much more technology push” between the two, because they will 44 Michael Bruno, “JSF Program Chief Cites Advantages Of Competing Engines,” Aerospace Daily & Defense Report, June 3, 2009: 1-2. Congressional Research Service 20 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress be striving to win more engine buys. The two companies also will try to introduce such innovations as more efficient blades, fuel savings and thrust growth capability. Late last month, team officials told reporters there is a “strong business case” to continue the second engine program, and it will cost roughly $130 million—compared to the $100 billion total for F-35 engine production—to open the F136 production line. Further, international partners including the United Kingdom entered into the JSF program with the expectation that there will be two engines, they contended. If Congress directs the JSF program office to continue the F136 program, then Heinz will introduce the first four GE-Rolls-Royce power plants into the F-35’s fourth low-rate initial production lot, the Marine Corps general said. The engine buys will then ramp up to the point where there will be a 50-50 split in engine procurement by LRIP-6. “That would also allow the GE motor to be in operation for about a year in the fleet so I now have both costing data, I’ve got them to about the same point in quantities, and I’ve got operational experience with both motors,” Heinz said. “At that point, the services and the [Joint Program Office] have pretty good information to start competition and to start the competitive nature to start to drive how much quantity I buy in the next years following that.” The true competition, by Heinz’s calculations, will begin in FY-13, he said. Adding that it would be “reckless” not to plan for the possibility of F136 congressional funding, Heinz said the Office of the Secretary of Defense should release advance procurement funding for the second engine if Congress shows their commitment to the program in its markup of the FY-10 budget. Though such funding has been appropriated in previous years’ budgets, none of the money thus far has gone to the program office. 45 A June 18, 2009, press report states: Despite the Obama administration’s official desire to cancel the General Electric/RollsRoyce (GE/RR) F136 alternate engine for the F-35 Joint Strike Fighter, the program and its customers are privately telling the manufacturers that the engine is needed. Behind this apparent contradiction, GE and RR people at the show here believe, is the fact that the F136 has more inherent power potential than the current Pratt & Whitney F135 configuration. GE program leader Jean Lydon-Rogers confirmed here, for the first time in a formal briefing, that the F136 was designed, from the start of system development and demonstration in 2004, with a bigger core and greater total airflow than was planned in the pre-SDD stage, to deal with ncreases in the JSF’s weight. One result is that the engine could gain 5 percent in thrust (more than 2,000 pounds) with a simple software change. In the medium term, though, GE and RR believe that the F136 has a bigger temperature margin than the F135, allowing it to maintain performance in hot-andhigh conditions. 45 Jason Simpson, “Heinz: DOD Must Look At Operational Risks of Having One JSF Engine,” Inside the Navy, June 8, 2009. Congressional Research Service 21 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress This will be important for the United Kingdom. Although the F135 is expected to meet formal key performance parameters, including the short-takeoff-and-vertical-landing F35B’s bring-back requirement for the U.S. Marine Corps, Britain’s experience of Harrier operations under hot, humid and high-level conditions in Afghanistan has led to a tougher “hot day” definition. GE and RR say that the F136 can deliver more performance under those conditions. The program office and customers recognize this issue, according to people associated with the F136. The problem is that in the past (and still, with this week’s action in the House of Representatives), Congress has cut aircraft from the program to pay for the F136 (Aerospace DAILY, June 17), and the program office and customers don’t want to see that happen either. They want Congress to fund the F136 from other sources. Further complicating the issue is that the White House has now formally come out in favor of cutting the F136.46 Development Status and Readiness for Higher-Rate Production Another issue for Congress for the F-35 program in FY2010 concerns the development status of the F-35 and whether the aircraft is ready to shift into higher rate production. Administration Perspective At a May 20, 2009, hearing before the Air and Land Forces subcommittee of the House Armed Services Committee on Air Force acquisition programs, a DOD acquisition official stated: The decision to increase the six-year F-35 production profile by 28 aircraft was driven by the need to create a more efficient ramp-rate from year to year as we prepare to enter full-rate production in the 2015 timeframe. Accelerating the 28 aircraft deliveries into the Fiscal Years 2010-2015 FYDP lowers the unit cost, expedites delivery of aircraft to the warfighter, and has the added benefit of saving approximately $500 million over the life of the program. More importantly, appropriately managing the investments in this ramp-rate is critical to meeting our warfighter requirements at the lowest possible cost to the taxpayer. The current state of the flight test schedule was considered in making this decision. The developmental flight testing begins in earnest this year, with operational testing not scheduled to begin until 2012. While flight testing is an important part of the program, it is not the only indicator of performance verification. Design maturity, manufacturing quality metrics, and software stability are providing confidence through initial structural testing, limited flight envelope testing, and predicted versus actual performance in the large number of labs and simulators. The Department believes that the investment now, to achieve a more efficient production ramp, will yield savings over the long term and ensure the Services receive the warfighting assets they need to execute their operational requirements.47 At the same hearing, Air Force officials stated the following: The F-35 is projected to meet all Key Performance Parameters (KPP) and as of 10 May 2009, AA-1 [an F-35 SDD aircraft] has completed 84 test flights, including a deployment to Eglin AFB. The first system design and development (SDD) Short Take-Off and Vertical 46 Bill Sweetman, “JSF Needs F136, Partners Say At Air Show,” Aerospace Daily & Defense Report, June 18, 2009: 2. 47 Statement of Mr. David G. Ahern, Director, Portfolio Systems Acquisition, Office of the Under Secretary of Defense (Acquisition, Technology, and Logistics), Before the House Armed Services Committee Subcommittee on Air and Land Forces, May 20, 2009, p. 7. Congressional Research Service 22 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Landing (STOVL) aircraft, BF-1, has completed 14 flights. The second SDD STOVL aircraft, BF-2, had its first flight in February 2009. The Cooperative Avionics Test Bed (CAT-B) continues to provide unprecedented risk reduction at this stage in a major weapon system not seen in any legacy program. In December 2008, the Defense Acquisition Executive (DAE) approved full funding for 7 Conventional Take-Off and Landing (CTOL) aircraft and engines, plus sustainment and associated equipment as part of the Low Rate Initial Production (LRIP) Lot 3 acquisition decision memorandum. In addition, the DAE approved full funding for seven STOVL aircraft plus sustainment and associated equipment contingent upon successful completion of the F135 Pratt & Whitney lead engine Stress Test, Flight Test Engine 6 Proof Test and receipt of full STOVL flight clearance, which occurred on 30 January 2009.48 At a May 19, 2009, hearing before the Seapower and Expeditionary Forces subcommittee of the House Armed Services Committee on Department of the Navy aviation procurement programs, Navy and Marine Corps Officials stated: Three SDD jets (AA-1, BF-1 and BF-2) are in flight testing. The remaining SDD jets and ground test articles, plus Low Rate Initial Production (LRIP) I and LRIP II aircraft, are in various stages of production. The SDD jets are setting new standards for quality and manufacturing efficiencies that improve with each jet. In flight testing, the initial Conventional Takeoff and Landing (CTOL) aircraft (AA-1) has demonstrated superb performance and reduced program risk, with 81 sorties (~111 flight hours) flown through April 20, 2009. BF-1, the first STOVL flight test jet, first flew in June 2008, on the schedule established two-years prior. BF-1 has flown 14 flights (~13 hours), and is currently on the hover pit, undergoing vertical engine operations. BF-2 first flew February 2009 and returned with no flight discrepancies noted. BG-1 static test results are favorable. The F135 engine has completed 11,300+ test hours on 16 engines through mid-April 2009. Software is 74% complete, with 13 million lines of code released including Block 0.5 Mission Systems, per the spiral development plan/schedule and with record-setting code-writing efficiencies. Software demonstrates stability across multiple Mission System subsystems. Systems integration testing continues on plan via flight tests, a flying lab and over 150,000 hours of ground labs testing. A fully integrated Mission Systems jet will fly later this year. The second production lot contract was signed below the cost model prediction. LRIP III contract negotiations are near complete, and LRIP IV Advance Procurement funding is on contract. All F-35 variants are projected to meet their respective Key Performance Parameters. The F-35 plan for incremental blocks of capability balances cost, schedule and risk.49 48 Department of the Air Force Presentation to the House Armed Services Committee Subcommittee on Air and Land Forces, United States House of Representatives, Subject: Air Force Programs, Combined Statement of: Lieutenant General Daniel J. Darnell, Air Force Deputy Chief Of Staff For Air, Space and Information Operations, Plans And Requirements (AF/A3/5) [and] Lieutenant General Mark D. Shackelford, Military Deputy, Office of the Assistant Secretary of the Air Force for Acquisition (SAF/AQ) Lieutenant General Raymond E. Johns, Jr., Air Force Deputy Chief of Staff for Strategic Plans And Programs (AF/A8) May 20, 2009, pp. 10-11. 49 Statement of Vice Admiral David Architzel, USN, Principal Military Deputy, Research, Development and Acquisition, LTGEN George J. Trautman III, USMC, Deputy Commandant for Aviation, [and] RADM Allen G. Myers, USN, Director of Warfare Integration, Before the Seapower and Expeditionary Warfare [sic: Forces] Subcommittee of the House Armed Services Committee [hearing] on [the] Department of the Navy’s Aviation Procurement Program, May 19, 2009, p. 2. Congressional Research Service 23 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress GAO Perspective March 2009 GAO Report A March 2009 Government Accountability Office (GAO) report providing assessments of major DOD weapon acquisition programs stated the following about the F-35 program: Technology Maturity Five of the JSF’s eight critical technologies are mature. The remaining three—mission systems integration, prognostics and health management, the radar—are approaching maturity. Design Maturity The program reported that it had released over 90 percent of planned engineering drawings for each of the three variants indicating that the designs are generally stable. While the designs appear stable, the late release of design drawings led to manufacturing inefficiencies from which the program is still recovering. Production Maturity The JSF program’s production processes are not mature. While the program collects information on the maturity of manufacturing processes, a good practice, only about 12 percent of its critical manufacturing processes are in statistical control. Projected labor hours have increased about 40 percent since 2007. The late release of drawings and subsequent supplier problems have led to late part deliveries, delaying the program schedule and forcing inefficient manufacturing processes. Program officials do not expect these inefficiencies to be fully corrected until 2010, during its third low rate production lot. The JSF designs are still not fully proven and tested. Flight testing, begun in late 2006, was only about two percent completed as of November 2008. The program began testing its first production representative prototype—a short takeoff vertical landing variant flown in conventional mode—in June 2008. A fully integrated, capable aircraft is not expected to enter flight testing until 2012, increasing risks that problems found may require design and production changes and retrofits of completed aircraft. Other Program Issues The program continues to experience significant cost increases and schedule delays. A recent independent cost estimate identified additional funding requirements for system development of as much as $7.44 billion through fiscal year 2016. This would increase the total development costs 14 percent from $44.3 billion to $51.81 billion. The estimating team also projected a three year extension in system development. Separately, the program office has projected that development costs will increase by approximately $2.43 billion to address cost overruns on the airframe and engine contracts and to pay for a one-year schedule extension. The independent cost estimate was higher than the program office estimate because it also included (1) the alternate engine effort, (2) higher contractor engineering staff levels, (3) additional software growth, (4) an expanded flight test program, and (5) more labor hours to manufacture aircraft. Program officials argue that costs will be lower than the independent estimate because, among other things, they believe the program has made substantial progress in software development and has invested heavily in advanced simulation labs intended to reduce risk. Congressional Research Service 24 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Despite the program’s continued manufacturing problems and the infancy of the flight test program, DOD officials want to accelerate production by 169 aircraft between fiscal years 2010 and 2015. This may require up to $33.5 billion in additional procurement funding in those years. We believe this more aggressive production approach is optimistic and risky. Program Office Comments The program noted that JSF’s technical, software, production processes, and testing maturity are tracking to plan and substantially exceeding standards set in past programs. The manufacturing fit and quality of the jets are unprecedented and production processes are improving with each jet. The program’s second prototype test aircraft flew on the schedule established two-years prior. Software development is 65 percent complete (twelve million lines) in accordance with the spiral development plan/schedule and with record-setting codewriting efficiencies. The software demonstrates stability across multiple mission system subsystems. Systems integration testing continues on schedule through the use of flight tests, a flying lab, and over 150,000 hours of ground labs testing. A fully integrated mission systems jet is scheduled to fly in 2009. The latest DOD independent cost estimate increased little from the one of four years ago. The second production lot contract was signed for a price below the cost model prediction. The program’s plan for incremental blocks of capability balances cost, schedule and risk.50 May 2009 GAO Testimony At a May 20, 2009, hearing before the Air and Land Forces subcommittee of the House Armed Services Committee on Air Force acquisition programs, GAO testified on the F-35 program, stating: JSF development will cost more and take longer to complete than reported to the Congress in April 2008, primarily because of contract cost overruns and extended time needed to complete flight testing. DOD is also significantly increasing annual procurement rates and plans to buy some aircraft sooner than reported last year. Total development costs are projected to increase between $2.4 billion and $7.4 billion and the schedule for completing system development extended from 1 to 3 years.... Manufacturing of development test aircraft is taking more time, money, and effort than planned, but officials believe that they can still deliver the 9 remaining test aircraft by early 2010. The contractor has not yet demonstrated mature manufacturing processes, or an ability to produce at currently planned rates. It has taken steps to improve manufacturing; however, given the manufacturing challenges, DOD’s plan to increase procurement in the near term adds considerable risk and will be difficult to achieve. DOD is procuring a substantial number of JSF aircraft using cost reimbursement contracts. Cost reimbursement contracts place most of the risk on the buyer—DOD in this case—who is liable to pay more than budgeted should labor, material, or other incurred costs be more than expected when the contract was signed. JSF flight testing is still in its infancy and continues to experience flight testing delays. Nonetheless, DOD is making substantial investments before flight testing proves that the JSF 50 Government Accountability Office, Defense Acquisitions[:] Assessments of Selected Weapon Programs. GAO-09326SP, March 2009. p. 94. Congressional Research Service 25 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress will perform as expected. DOD may procure 273 aircraft costing an estimated $42 billion before completing flight testing. Procurement Investments and Progress of Flight Testing Cumulative procurement (billions of dollars) Cumulative aircraft procured Percentage of flight test program completed 2007 2008 2009 2010 2011 2012 2013 2014 $0.9 $3.6 $6.9 $13.7 $20.6 $31.1 $41.9 $54.3 2 14 28 58 101 183 273 383 <1% <1% 2% 9% 34% 62% 88% 100% Source: GAO analysis of DOD data51 Press Reports A June 2, 2009, press report states: Joint Strike Fighter officials are refocusing the program on delivering test-ready aircraft following further delays to completing F-35s for development flight-testing. The shift will delay the first flight of aircraft still in production by up to three months, but is expected to enable faster flight-testing to recover some of the slippage. Aircraft were previously being flown once, then grounded for modifications to incorporate design changes resulting from analysis and testing. “There was a lot of emphasis on first flight under past program leadership. The event became important, not the readiness [for testing],” says Doug Pearson, vice president of the F-35 integrated task force. “When there was more work to do on the aircraft, it was added after first flight. And over time, the additions became more than we wished for,” he says. For example, aircraft BF-2 flew once in February and has been in modification since. New JSF program executive officer Brig. Gen. David Heinz has asked Lockheed Martin to study the effect of rephasing the work to accomplish the modifications on assembly before first flight. The ferry flight to the test center at Edwards Air Force Base in California or Naval Air Station Patuxent River in Maryland would become the new programmatic milestone. “We need to get them built, and ready to test, before they fly,” Pearson says. 51 Government Accountability Office, Joint Strike Fighter[:]Strong Risk Management Essential as Program Enters Most Challenging Phase, Statement of Michael Sullivan, Director Acquisition and Sourcing Management. GAO-09711T, May 20, 2009, summary page. Congressional Research Service 26 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Instead of flying all the development F-35s by year’s end, four of the aircraft would slip into 2010, Heinz says, but Lockheed hopes to recover some of the delay by delivering fully modified aircraft into productive flight-testing. Aircraft BF-1, the first short takeoff and vertical landing (STOVL) F-35B, is in modification following hover-pit testing and is expected to return to flight by the end of July. After around 12 flights from the Fort Worth, Texas, plant to verify design changes and qualify the aircraft for probe-and-drogue refueling, BF-1 is expected to ferry to Patuxent River at the end of August to begin STOVL “build down” flight-testing. Another 12-20 flights at progressively lower altitudes and speeds are expected to culminate in the first vertical land on the hover pad at Patuxent River in September/October. “I will be surprised if it goes beyond October,” says Pearson, while describing it as an aggressive schedule. “There’s a reasonable chance it will happen before the end of September.” Aircraft BF-2 is due at Patuxent River in September while BF-4, the first F-35 missionsystem test aircraft, is expected to arrive by year’s end. BF-3 is a loads aircraft and will go though extensive ground testing before flying. Aircraft AF-1 and -2, the first production-representative conventional takeoff and landing F35As, will be the next aircraft to fly, Pearson says. They are scheduled for delivery to the Edwards test center in the first quarter of next year. The first F-35C carrier variant, CF-1, is now scheduled to fly on Dec. 23, a slip of three months, with the other two test aircraft following early in 2010. All three will go to Patuxent River. Because of delays, the bulk of the 5,000-plus development flights will now be conducted in 2010 and 2011, but Pearson still expects to complete operational testing in 2014. The original schedule was 2013, but this was extended last year.52 A June 8, 2009, press report states: The Marine Corps short-take-off, vertical-landing (STOVL) variant of the Joint Strike Fighter is now slated to begin in-flight transition to the aircraft’s lift fan in August, months later than originally intended, Brig. Gen. David Heinz, JSF program executive officer, said last week. There are still tests and modifications that need to be done on the first STOVL test aircraft, BF-1, before the ramp-down to full vertical flight can begin, Heinz said, adding that the delay to the aircraft would not have a significant impact on the testing schedule because the program has a cushion built in to absorb such setbacks. The tests were originally supposed to take place this spring. “Today I have programmed for the availability slots a ramp to get to 12 successful sorties per month per airplane,” he said during a June 2 roundtable with reporters at the JSF program office in Arlington, VA. “If you take in aggregate every one of those airplanes sliding three 52 Graham Warwick, “JSF Program Refocusing On Test-Ready Aircraft Deliveries,” Aerospace Daily & Defense Report, June 2, 2009: 1-2. Material in brackets as in original. Congressional Research Service 27 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress months before you deliver them to the flight test program, that only goes to 12.6 successful sorties.” Heinz noted that it is a three-year test program and, at the end of this year, all 12 of the flight test vehicles for the Navy, Marine Corps and Air Force JSF variants will have been delivered. He said the program has already resourced for six flying days per week while his schedule calls for using only five. “First of all, 12.6 is really in the national average,” he said. “The F/A-18E/F program accomplished about 13.1 ... so I’m not asking this huge leap.” As it stands now, the BF-1 finished hover-pit testing and is undergoing modifications, which will end this month. The plane will begin a series of 12 flights transition from conventional flight to STOVL mode at the end of August, leading to its first full vertical landing about a month later, the general said. Heinz said he is not worried about the Pratt and Whitney-built F135 engine, which had highcycle fatigue problems in the past year. “I’m not at all concerned about that,” he said. “We’ve already done all the durability testing that proves out that that’s going to work for the life of the motor.” Heinz also pointed to the reliability of the aircraft and the software, which he claimed were performing very well. “I’m already achieving on the order of 80 flight hours before a software incident,” he said. The program has also conducted 99 flights, and “77 of those flights have come back ready to fly the mission without work, and so that is a good indicator,” he said. In all, the three JSF variants will fly about 5,000 test sorties over about 10,000 hours during the testing phase of the program. BF-1 began hover-pit testing in Fort Worth, TX, in March. Lockheed Martin will send the aircraft to Naval Air Station Patuxent River, MD, to begin full vertical flight tests. The aircraft has flown 14 times in conventional mode.53 Affordability and Projected Fighter Shortfalls An additional potential issue for Congress for the F-35 program concerns the affordability of the F-35, particularly in the context of projected shortfalls in both Air Force fighters and Navy and Marine Corps strike fighters. Although the F-35 was conceived as a relatively affordable strike fighter, some observers are concerned that, in a situation of constrained DOD resources, F-35s might not be affordable in the annual quantities planned by DOD, at least not without reducing funding for other DOD programs. As the annual production rate of the F-35 increases, the program will require more than 53 Dan Taylor, “Heinz: Transition of JSF to STOVL Mode Will Not Begin Until August,” Inside the Navy, June 8, 2009. Congressional Research Service 28 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress $10 billion per year in acquisition funding at the same time that DOD will face other budgetary challenges. The issue of F-35 affordability is part of a larger and longstanding issue concerning the overall affordability of DOD’s tactical aircraft modernization effort, which also includes procurement of F-22s (through FY2009, at least), and F/A-18E/Fs (through FY2012, at least).54 Some observers who are concerned about the affordability of the F-35 in the numbers desired by DOD have suggested procuring upgraded F-16s as complements or substitutes for F-35As for the Air Force, and F/A-18E/Fs as complements or substitutes for F-35Cs for the Navy. F-35 supporters argue that F-16s and F/A-18E/Fs are less capable than the F-35, and that the F-35 is designed to have reduced life-cycle operation and support (O&S) costs. The issue of F-35 affordability occurs in the context of a projected shortfall of up to 800 Air Force fighters that was mentioned by Air Force officials in 2008,55 and a projected shortfall of more than 100 (and perhaps more than 200) Navy and Marine Corps strike fighters.56 Observers concerned about the affordability of the F-35 might argue that an inability to procure F-35s in desired numbers could contribute to these projected shortfalls. Supporters of the F-35 might argue that, as a relatively affordable aircraft that can be procured in highly common versions for the Air Force, Marine Corps, and Navy, the F-35 represents the most economical and cost-effective strategy for avoiding or mitigating such shortfalls.57 Air Force officials have testified that they wish to double F-35 purchases over the next five years to alleviate the projected Air Force shortfall.58 Implications for Industrial Base Another potential issue for Congress regarding the F-35 program concerns its potential impact on the U.S. tactical aircraft industrial base. The October 2001 award of the F-35 SDD contract to a single company (Lockheed) raised concerns in Congress and elsewhere that excluding Boeing 54 For more on this issue, see CRS Report RL33543, Tactical Aircraft Modernization: Issues for Congress. Testimony of Lieutenant General Daniel Darnell, Deputy Chief of Staff, Air, Space and Information Operations, Plans and Requirements, before an April 9, 2008, hearing on Air Force and Navy aviation programs before the Airland subcommittee of the Senate Armed Services Committee. (Source: Transcript of hearing.) 56 For more on the projected Navy-Marine Corps strike fighter shortfall, see CRS Report RL30624, Navy F/A-18E/F and EA-18G Aircraft Procurement and Strike Fighter Shortfall: Background and Issues for Congress. 57 There have also been strong differences of opinion over how F-35 costs are calculated and presented. DOD’s estimate of the total acquisition cost of the F-35 program, for example, shows the overall cost decreasing from $299 billion in December 2006 to $298 billion in December 2007. Some observers suggested that these figures were misleading, because the largest savings reported by DOD in the December 2007 report were achieved not by improvements in design or manufacture, but instead by moving costs from one category to another. (David Fulghum, “Dueling Analyses; Questions Remain About the Fundamental Soundness of Top Pentagon Programs,” Aviation Week & Space Technology, April 14, 2008.) The GAO offered strong criticism of JSF cost estimates, writing that they were not comprehensive, not accurate, not well documented, nor credible. (Government Accountability Office, Joint Strike Fighter[:]Recent Decisions by DOD Add to Program Risks, GAO-08-388, March 2008, summarized on pp. 3-4 and addressed in detail throughout the report.) In summary, GAO noted that the JSF cost estimates did not include $7 billion for the F136 engine, and that the official JSF cost estimates are at odds with estimates made by three independent DOD agencies. JSF supporters disputed the GAO’s findings, arguing that the program office’s cost models are more reliable than those used by other organizations. (Amy Butler, “Cost Question,” Aviation Week & Space Technology, July 14, 2008.) GAO is not the only organization to question the JSF cost estimates. An internal DOD organization—the Joint Estimate Team or JET—has argued that the JSF program will cost $15 billion more than official DOD cost projections. (Marcus Weisgerber, “‘Independent’ DOD Assessment Finds JSF Underfunded by $15 Billion,” Inside the Air Force, November 28, 2008.) 58 John Reed, “Air Force Working To More Than Double The Pace Of F-35 Purchases,” Inside the Air Force, July 25, 2008. 55 Congressional Research Service 29 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress from this program would reduce that company’s ability to continue designing and manufacturing fighter aircraft.59 Similar concerns regarding engine-making firms have been raised since 2006, when DOD first proposed (as part of the FY2007 budget submission) terminating the F136 alternate engine program. Some observers are concerned that that if the F136 were cancelled, General Electric (GE) would not have enough business designing and manufacturing fighter jet engines to continue competing in the future with Pratt and Whitney (the manufacturer of the F135 engine). Others argued that GE’s considerable business in both commercial and military engines was sufficient to sustain GE’s ability to produce this class of engine in the future.60 Exports of the F-35 could also have a strong impact on the U.S. tactical aircraft industrial base through export. Most observers believe that the F-35 could potentially dominate the combat aircraft export market, much as the F-16 has. Like the F-16, the F-35 appears to be attractive because of its relatively low cost, flexible design, and promise of high performance. Competing fighters and strike fighters, including France’s Rafale, Sweden’s JAS Gripen, and the European Typhoon, are positioned to challenge the F-35 in the fighter export market. Some observers are concerned that by allowing foreign companies to participate in the F-35 program, DOD may be inadvertently opening up U.S. markets to foreign competitors who enjoy direct government subsidies. A May 2004 GAO report found that the F-35 program could “significantly impact” the U.S. and global industrial base. 61 GAO found that two laws designed to protect segments of the U.S. defense industry—the Buy American Act and the Preference for Domestic Speciality Metals clause—would have no impact on decisions regarding which foreign companies would participate in the F-35 program, because DOD has decided that foreign companies that participate in the F-35 program, and which have signed reciprocal procurement agreements with DOD to promote defense cooperation, are eligible for a waiver. Legislative Activity for FY2010 FY2010 Defense Authorization Bill (H.R. 2647) House The House Armed Services Committee reported H.R. 2647 on June 18, 2009. 59 For more information, see CRS Report RL31360, Joint Strike Fighter (JSF): Potential National Security Questions Pertaining to a Single Production Line, by Christopher Bolkcom and Daniel H. Else. 60 For more information, see CRS Report RL33390, Proposed Termination of Joint Strike Fighter (JSF) F136 Alternate Engine, by Christopher Bolkcom. 61 General Accountability Office, Joint Strike Fighter Acquisition: Observations on the Supplier Base, GAO-04-554, May 2004. Congressional Research Service 30 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Program Funding As of June 19, 2009, the text of the committee’s report on H.R. 2647 (H.Rept. 111-166) was not posted on the Legislative Information System. The committee’s summary table of actions on major acquisition programs states that the bill: • recommends increasing the administration’s request for Air Force RDT&E funding for the program by $153.5 million; • recommends increasing the administration’s request for Department of the Navy RDT&E funding for the program by $153.5 million; • recommends reducing the administration’s request for Air Force procurement funding for the program by $67.0 million, and reducing the requested number of F-35As to be procured by one (from 10 to nine); and • recommends reducing the administration’s request for Department of the Navy procurement funding for the program by $122.0 million, and reducing requested the number of F-35Bs and Cs to be procured by one (from 20 to 19). The committee’s narrative summary of the bill states: The committee provides $6 billion [in procurement funding] for 28 F-35s, one less aircraft each for the Air Force and Navy than the budget request, but twice the number authorized in FY09. This maintains DOD’s desired year-over-year production rate [increase] of 1.75. Fifteen F-35Bs are provided for the Marine Corps, [and] four F-35Cs for the Navy [authorized in the Seapower and Expeditionary Forces Subcommittee] and nine F-35As are provided for the Air Force (authorized in the Air and Land Forces Subcommittee).62 The committee’s narrative summary of the bill also states: The committee has provided increased funding for the competitive engine for the JSF in each of the past three years and is greatly disappointed that the administration chose not to submit funding for this program in its FY10 budget request. In the future, 90% of the fighters in the U.S. inventory will run on the JSF engine. We cannot afford to have an engine glitch that grounds 90% of our fleet. Accordingly, the committee reduces the overall JSF request by a total of $464 million and provides an overall increase of $603 million for the competitive engine program, $463 million for continued development and $140 million for procurement. The bill also requires DOD to include funding for the competitive engine program in future budget requests. The committee also includes an increase of $129 million for Air Force JSF procurement to address a budget shortfall in JSF spares and support equipment, one of the Air Force’s top unfunded requirements for FY10. Finally, the bill fences 25% of R&D funding for the JSF aircraft until DOD submits its 30year aircraft plan and F/A-18 multiyear procurement reports required by the FY09 NDAA, and obligates all funds for development and procurement of the JSF’s competitive engine.63 62 63 House Armed Services Committee summary of H.R. 2647, p. 21. House Armed Services Committee summary of H.R. 2647, p. 25. Congressional Research Service 31 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Legislative Provisions H.R. 2647 as reported by the House Armed Services Committee contains a number of legislative provisions relating to the F-35 program. Section 242 states: SEC. 242. INCLUSION IN ANNUAL BUDGET REQUEST AND FUTURE-YEARS DEFENSE PROGRAM OF SUFFICIENT AMOUNTS FOR CONTINUED DEVELOPMENT AND PROCUREMENT OF COMPETITIVE PROPULSION SYSTEM FOR F-35 LIGHTNING II. (a) Annual Budget- Chapter 9 of title 10, United States Code, is amended by adding at the end the following new section: `Sec. 235. Budget for competitive propulsion system for F-35 Lightning II `(a) Annual Budget- Effective for the budget of the President submitted to Congress under section 1105(a) of title 31, United States Code, for fiscal year 2011 and each fiscal year thereafter, the Secretary of Defense shall include, in the materials submitted by the Secretary to the President, a request for such amounts as are necessary for the full funding of the continued development and procurement of a competitive propulsion system for the F-35 Lightning II. `(b) Future-Years Defense Program- In each future-years defense program submitted to Congress under section 221 of this title, the Secretary of Defense shall ensure that the estimated expenditures and proposed appropriations for the F-35 Lighting II, for each fiscal year of the period covered by that program, include sufficient amounts for the full funding of the continued development and procurement of a competitive propulsion system for the F-35 Lightning II. `(c) Requirement to Obligate and Expend Funds- Of the amounts authorized to be appropriated for fiscal year 2010 or any year thereafter, for research, development, test, and evaluation and procurement for the F-35 Lightning II Program, the Secretary of Defense shall ensure the obligation and expenditure in each such fiscal year of sufficient annual amounts for the continued development and procurement of two options for the propulsion system for the F-35 Lightning II in order to ensure the development and competitive production for the propulsion system for the F-35 Lightning II.’. (b) Clerical Amendment- The table of sections at the beginning of such chapter is amended by at the end the following new item: `235. Budget for competitive propulsion system for F-35 Lightning II.’. (c) Conforming Repeal- The National Defense Authorization Act for Fiscal Year 2008 (P.L. 110-181) is amended by striking section 213. Section 232 states: SEC. 232. ANNUAL COMPTROLLER GENERAL REPORT ON THE F-35 LIGHTNING II AIRCRAFT ACQUISITION PROGRAM. (a) Annual GAO Review- The Comptroller General shall conduct an annual review of the F35 Lightning II aircraft acquisition program and shall, not later than March 15 of each of Congressional Research Service 32 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress 2010 through 2015, submit to the congressional defense committees a report on the results of the most recent review. (b) Matters to Be Included- Each report on the F-35 program under subsection (a) shall include each of the following: (1) The extent to which the acquisition program is meeting development and procurement cost, schedule, and performance goals. (2) The progress and results of developmental and operational testing and plans for correcting deficiencies in aircraft performance, operational effectiveness, and suitability. (3) Aircraft procurement plans, production results, and efforts to improve manufacturing efficiency and supplier performance. Section 218 states: SEC. 218. LIMITATION ON OBLIGATION OF FUNDS FOR F-35 LIGHTNING II PROGRAM. Of the amounts authorized to be appropriated or otherwise made available for fiscal year 2010 for research, development, test, and evaluation for the F-35 Lightning II program, not more than 75 percent may be obligated until the date that is 15 days after the later of the following dates: (1) The date on which the Under Secretary of Defense for Acquisition, Technology, and Logistics submits to the congressional defense committees certification in writing that all funds made available for fiscal year 2010 for the continued development and procurement of a competitive propulsion system for the F-35 Lightning II have been obligated. (2) The date on which the Secretary of Defense submits to the congressional defense committees the report required by section 123 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (P.L. 110-417; 122 Stat. 4376). (3) The date on which the Secretary of Defense submits to the congressional defense committees the annual plan and certification for fiscal year 2010 required by section 231a of title 10, United States Code. Section 214 states: SEC. 214. SEPARATE PROCUREMENT AND RESEARCH, DEVELOPMENT, TEST AND EVALUATION LINE ITEMS AND PROGRAM ELEMENTS FOR THE F-35B AND F-35C JOINT STRIKE FIGHTER AIRCRAFT. In the budget materials submitted to the President by the Secretary of Defense in connection with the submission to Congress, pursuant to section 1105 of title 31, United States Code, of the budget for fiscal year 2011, and each subsequent fiscal year, the Secretary shall ensure that within the Navy research, development, test, and evaluation account and the Navy aircraft procurement account, a separate, dedicated line item and program element is assigned to each of the F-35B aircraft and the F-35C aircraft, to the extent such accounts include funding for each such aircraft. Section 133 states: Congressional Research Service 33 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress SEC. 133. REPORT ON 4.5 GENERATION FIGHTER PROCUREMENT. (a) In General- Not later than 90 days after the enactment of this Act, the Secretary of Defense shall submit to the congressional defense committees a report on 4.5 generation fighter aircraft procurement. The report shall include the following: (1) The number of 4.5 generation fighter aircraft for procurement for fiscal years 2011 through 2025 necessary to fulfill the requirement of the Air Force to maintain not less than 2,200 tactical fighter aircraft. (2) The estimated procurement costs for those aircraft if procured through single year procurement contracts. (3) The estimated procurement costs for those aircraft if procured through multiyear procurement contracts. (4) The estimated savings that could be derived from the procurement of those aircraft through a multiyear procurement contract, and whether the Secretary determines the amount of those savings to be substantial. (5) A discussion comparing the costs and benefits of obtaining those aircraft through annual procurement contracts with the costs and benefits of obtaining those aircraft through a multiyear procurement contract. (6) A discussion regarding the availability and feasibility of F-35s in fiscal years 2015 through fiscal year 2025 to proportionally and concurrently recapitalize the Air National Guard. (7) The recommendations of the Secretary regarding whether Congress should authorize a multiyear procurement contract for 4.5 generation fighter aircraft. (b) Certifications- If the Secretary recommends under subsection (a)(7) that Congress authorize a multiyear procurement contract for 4.5 generation fighter aircraft, the Secretary shall submit to Congress the certifications required by section 2306b of title 10, United States Code, at the same time that the budget is submitted under section 1105(a) of title 31, United States Code, for fiscal year 2011. (c) 4.5 Generation Fighter Aircraft Defined- In this section, the term `4.5 generation fighter aircraft’ means current fighter aircraft, including the F-15, F-16, and F-18, that— (1) have advanced capabilities, including— (A) AESA radar; (B) high capacity data-link; and (C) enhanced avionics; and (2) have the ability to deploy current and reasonably foreseeable advanced armaments. Congressional Research Service 34 F-35 Joint Strike Fighter (JSF) Program: Background and Issues for Congress Appendix. JSF Key Performance Parameters Figure A-1. Joint Strike Fighter: Key Performance Parameters KPP JOINT CV Combat Radius 450 nm USMC Profile 590 nm USAF Profile 600 nm USN Profile Sortie Generation 4 Surg / 3 Sust 3 Surg / 2 Sust 3 Surg / 2 Sust Logistics Footprint < 8 C -17 equivalent loads (20 PAA) < 8 C -17 equivalent loads (24 PAA) < 46,000 cu ft 243 ST Mission Reliability 95% 93% 95% STOVL Mission Performance Short Take-Off Distance STOVL Mission Performance Vertical Lift Bring Back USN CTOL Very Low Observable Radio Frequency Signature Interoperability USMC STOVL Maximum Approach Speed Meet 100% of critical, top-level Information Exchange Requirements Secure Voice and Data 550’ N/A N/A 2 x 1K JDAM, 2 x AIM -120 With Reserve Fuel N/A N/A N/A 145 knots N/A Notes: JSF Joint Program Office: October 11, 2007. PAA = Primary Aircraft Authorized, ST = Short Tons, Vertical Lift Bring Back = amount of weapons/fuel that can be safely landed with. Author Contact Information Ronald O'Rourke Specialist in Naval Affairs rorourke@crs.loc.gov, 7-7610 Congressional Research Service 35