As always, the F-35 Lightning II program provides a constant cavalcade of compelling stories—some good and others not so much. We have been following the ups and downs of the program for some time. See, for example, our story here in which we discussed potential cost increases to the carrier-based and STOVL versions of the Joint Strike Fighter (JSF), a potential halving of the United Kingdom aircraft order, and the initiation of yet another “bottom-up review of the program and its costs.” In this article, we noted that the U.S. Air Force had halted its plans to increase aircraft production to 110 planes per year, and instead had decided to “top-out” purchases at 80 planes per year, starting in GFY 2016.

Since that article was published in early February of 2010, there has been quite a bit happening on the JSF program. We’re going to skip over some history and focus on the most recent events.

The October 11, 2010 edition of Aviation Week & Space Technology magazine carried a story entitled, “Insult to Injury” in which it recounted some of those events. The article reported—

Lockheed Martin is … recovering from a short suspension of JSF flight operations in late September [2010] after problems with the fuel system software came to light in the laboratory. A sequencing problem was found to have the potential to shut down all three of the F-35’s boost fuel pumps. The suspension was lifted Oct. 5.

Four F-35B [STOVL] variants have been restricted only to conventional flight until a fix is implemented for a bearing-retention feature in the auxiliary inlet door’s forward hinge. The fix must receive airworthiness approval…. This is compounding difficulties keeping pace with STOVL fight-test expectations.

Another wrinkle … is the willingness of the U.S. Marine Corps., the first customer expected to use and deploy operational JSFs, to slip its date for initial operational capability (IOC). … However, timing for the steps to reach IOC … are under review as part of a major technical rebaselining … which is due in preparation for a Nov. 23 Defense Acquisition Board meeting on the F-35.

Looking abroad, the October 4, 2010 edition of AW&ST reported uncertainty on the part of the JSF’s international customers, resulting in “frustration” and “friction” between the U.S. and its international partners. The article reported—

Price has been a key issue…. A representative for a European F-35 customer says it has been frustrating not to have received a clear answer on what the aircraft will cost. [In addition] the issue of electronic warfare (EW) reprogrammability … has been an area of friction…. The U.S. has been slow to address these concerns….

The discussions are unfolding as overseas buyers are also adjusting plans to new program realities, reflecting delays announced this year by the Pentagon. As a result, Norway is delaying the start of acquiring most of its F-35s, following a similar decision announced last month by the Netherlands. Norway is postponing its procurements to avoid buying immature systems. This means the Norwegians will not start taking the bulk of their F-35s until 2018. … But Norway insists it remains committed to the program. The defense ministry reaffirms that it is seeing big industrial benefits from Norwegian companies’ participation.

Developments in Norway and the Netherlands are being closely followed by Denmark, which had already delayed its plans to make a type decision between the F-35, Boeing F/A-18E/F and Saab Gripen. But even if Denmark buys the F-35, it is looking to other international operators to iron out early fielding issues, so delivery delays in Norway, for example, could have a ripple effect in Denmark.

Adding “insult to injury,” however, has been the DOD’s decision “to decertify [Lockheed Martin’s] Forth Worth facility for lack of adherence to the government’s Earned Value Management System (EVMS) standards.” As the October 11^th AW&ST article reported—

Compliance problems first came to light in 2007, when the Defense Contract Management Agency (DCMA) found the Fort Worth site deficient in about half of the 32 EVMS guidelines. … DCMA approved a corrective action plan June 30, less than one month after the Pentagon recertified the F-35 to move forward, despite an 80% cost overrun.

The AW&ST article quoted a Pentagon spokesperson as saying—

The facility ‘continues to make inadequate progress against its corrective action plan,” and decertification was ‘necessary due to lack of progress.’ [The decertification] ‘will help ensure that Lockheed Martin devotes the needed attention to complete the corrective action plan in a timely manner. It also reinforces the responsibility the company has to deliver to the government what it agreed to.’

The AW&ST article also notes that DCMA permitted LockMart to conduct its own internal EVMS review in 2009 instead of performing a full re-audit of the system, because “it deemed a finding of compliance unlikely.” The article reports that “about 200 Lockheed Martin personnel are dedicated to EVMS,” but does not state whether that figure represents personnel located only in Fort Worth, or if they are located company-wide.

We have discussed our concerns with DOD’s evaluations of EVMS before. In our article on the Missile Defense Agency’s program management issues, we noted that 14 MDA programs were found by DCMA EVMS evaluators to be “noncompliant” with EVMS standards—and yet the Government Accountability Office (GAO) found that 12 of those 14 programs had program cost and performance measurement data reliable enough for its audit purposes. We quoted GAO as saying “We reviewed the basis for the noncompliance and unassessed ratings and determined that” the EVM data was reliable enough “for our purposes.” Clearly, opinions differ regarding whether contractors have implemented an adequate EVMS system that meets the standards of the 32 EVMS criteria.

In a recent article on this topic, Sandra Erwin wrote in National Defense magazine that the root cause of Lockheed Martin’s EVMS woes might not be simply ineffective management. She wrote—

“There is enough blame to go around in industry and government,’ said one industry source. … Contractors for years have complained to the Defense Department that the government’s in-house EVMS skills base has degraded. Over the past several decades, the popularity of EVMS has ebbed and flowed, and so has the level of top management attention it has received both in the public and private sectors, experts said. The Defense Department’s newly created ‘PARCA’ office (Performance Assessments and Root Cause Analyses) within the office of the undersecretary of defense for acquisition is supposed to have an EVMS ‘policy czar’ on the staff, but that position remains unfilled. … The ‘executive agent’ in charge of overseeing EVMS since 1996 has been the Defense Contract Management Agency. Several senior jobs in that shop also remain vacant, sources said. … Well planned out, EVMS tells you ‘where your problems are going to be. … But if you let the skills deteriorate, you get surprises.’

So before anybody gets too upset at LockMart’s loss of EVM System adequacy, consider whether the U.S. Government reviewers were being objective in their review procedures. One source (the DOD Inspector General) has recently accused DOD EVMS reviewers of failing to “demonstrate independence and objectivity in fulfilling its oversight responsibilities.” For our part, we are reserving judgment.

But before we move on, let’s note some positive news for the program. It’s not all doom and gloom.

• On October 7, 2010, Israel signed a contract to purchase 20 JSF aircraft in a deal reportedly worth $2.75 billion dollars. The deal reported includes an option that would allow Israel to purchase up to 75 additional jets. The deal is being funded by U.S. Foreign Military Sales (FMS) funds.

• On October 8, 2010, Flight Global reported that Lockheed Martin had received $13 million to incorporate a “shipboard rolling vertical landing” (SRVL) capability into the STOVL F-35B. The funding came from the U.S. Navy, but the work will be performed on behalf of the United Kingdom. The SRVL capability will reportedly “enable the F-35B to return to an aircraft carrier’s deck carrying more weapons and fuel than possible when making a vertical landing.”

• On October 11. 2010, a Federal District Court judge dismissed a whistleblower “qui tam” suit that alleged Lockheed Martin “followed unsafe and fraudulent practices in developing flight control software for the F-25 joint strike fighter,” according to this report. The case was dismissed with prejudice after LockMart filed a motion which argued that “the case should be dismissed because Davis failed to present evidence of specific acts of Lockheed or its employees making false claims.”
  

To sum it all up, the program continues to experience challenges—as one might expect of the largest U.S. defense program in the history of ever. Despite the drama surrounding the program, it seems as if it is moving ahead. Perhaps it is not moving as quickly as originally hoped-for, but nonetheless it looks like progress is being made.

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