Pratt considers its lot-by-lot engine pricing to be competitive and does not release per-unit cost data. Based on the value of LRIP 5, however, the average cost is $32 million, including spares.
The cost between the different engines for the conventional A-model, short-takeoff-and-vertical-landing B-model and carrier-capable C-model vary significantly, however. This is largely due to the Rolls-Royce lift-fan on the B.
EVMS decertification is not an indictment of a company’s technology or ability to deliver quality equipment. It does, however, indicate an inability of the Pentagon to certify the data on a company’s progress in executing programs. This means that the data could be flawed.
“The EVM requirement is meant to protect taxpayers from overbilling and focuses on the business systems defense companies use to estimate costs for bids; purchase goods from subcontractors; manage government property and materials; and track for costs and schedule progress,” Dellavedova says.
Pratt is working on four areas to improve its EVMS compliance: updating documentation to better align with process, improving how scheduling tools are managed and integrated, better cost estimating and forecasting, and improving planning for work packages. The company has submitted corrective action plans for each to DCMA for approval.
Once these plans are settled on, the company will have a target date to get recertified. “We are committed to having the best earned value management system possible, and to consistently and accurately track performance and execution to our contracts,” Bates says.
Lockheed Martin, F-35 prime contractor, has been decertified for its EVMS compliance at the Fort Worth Joint Strike Fighter final assembly plant since 2010; a similar 5% withholding was placed on the company’s contracts. DCMA first noted Lockheed’s problems in 2007 and formally decertified the company when the needed improvements were not implemented.
In late August, DCMA reduced the withholding on Lockheed Martin to 2% when it decided the company was “making significant progress on the approved corrective action plan,” says Kenneth Ross, a Lockheed Martin spokesman.