SAR Underscores F-35 Sustainment Cost Confusion

By Amy Butler
Source: Aviation Week & Space Technology
June 03, 2013
Credit: Lockheed Martin

The latest F-35 cost report shows that after years of study, the Pentagon is seemingly no closer to clarifying the expense of operating and sustaining the stealthy new F-35 fighter, or reducing its staggering $1 trillion, 50-year life-cycle cost.

According to the 92-page F-35 selected acquisition report (SAR), the estimated cost of using the F-35 remains just as high as it was a year ago, although the difference between operating it and the legacy fleet has been diminished. Pentagon cost estimators inflated the cost per flying hour (CPFH) of the F-16C/D, the largest legacy fleet to be replaced by the F-35A, in calculating the operating cost difference between the F-16 and F-35.

As Air Force Chief of Staff Gen. Mark Welsh put it, the service needs an “apples-to-apples” comparison with the cost to operate its legacy fleet. And program officials and users in each of the U.S. services have been studying not only how to lower the F-35 CPFH but also reduce the total life-cycle cost. The CPFH can fluctuate with maintainers' skill levels and prices of parts and fuel, for example.

The SAR has provided a new methodology for comparing the F-16C/D and F-35A CPFH by “normalizing,” or effectively inflating, operations costs of the legacy fleet. One defense official familiar with cost-estimating practices says it is highly unusual to “tinker with actuals,” or numbers derived from real operations. The F-16C/D fleet has decades of data on which to rely, while the production version of the F-35 has only been flying for four years.

“The F-16C/D costs were developed in a joint effort with the Air Force Cost Analysis Agency and have been normalized for comparison to the F-35 estimate,” the SAR says. “In order to make the comparison more relevant, the actual F-16C/D CPFH was adjusted to reflect the cost of fuel and number of flight hours assumed by F-35A. The F-16C/D was also increased to include costs that F-16 shares with other Air Force platforms: Systems Engineering/Program Management, maintenance training costs, certain software development efforts and information systems.”

Moreover, the design and operation of the F-16C/D and F-35 belong to different eras. The F-35, for example, will be managed by a sweeping data-handling system called the Autonomic Information Logistics System (ALIS) that will include such tasks as aircraft diagnostics, parts supply and mission planning. No such system exists for the F-16, leaving cost estimators unsure about how to account for ALIS in projecting flying-hour costs in an “apples-to-apples” comparison of the two fighters.

The total F-16 CPFH is now estimated to be $24,899 (78% of the F-35's), up from $22,470 last year (70% of the F-35's). This year's F-16 cost includes actual data reported from squadrons as well as the other factors listed above.

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