Air Force Secretary Michael Donley says a major cost overrun in the multi-national F-35 Joint Strike Fighter program is probable, and under the Nunn- McCurdy statute it would trigger a mandatory review of alternatives.

But, the outcome could already be determined. “This is a fifth-generation fighter/attack capability,” Donley told reporters last week during a Defense Writers Group breakfast here. “There are no alternatives to that in our system. Yes, you can build the 4.5-generation, enhanced-capability F-15 kind of capability. But, really there are no good alternatives to F-35 at this point. This is a program to which we are deeply committed.” The Nunn-McCurdy statute dictates that in programs that breach cost by 50% or more the Defense secretary must certify: the program is critical for national security, no alternatives of equal capability at less cost exist, updated cost estimates are sound, and management is adequate to control future costs.

The Air Force has slipped its F-35 in-service date by two years to late calendar year 2015, and Navy officials are reassessing plans for a 2014 carrier variant initial operational capability (IOC) milestone. The Marine Corps is still aiming for a 2012 IOC.

Donley says the Pentagon is behaving as if the overage had already been declared. “We’ve been taking all the mitigating and corrective action we would take as if there were a Nunn-McCurdy breach,” he says. “But, . . .w e are still working through all these details.”

In a Feb. 24 acquisition decision memorandum (ADM) on JSF obtained by Aviation Week, Pentagon acquisition chief Ashton Carter notes that the restructured program is based on the findings of the Joint Estimating Team II report (prepared last fall and updated from the JET I of a year earlier). The JET II analysis is a 50% confidence estimate; it has an equal chance of over- or underestimating the program’s cost.

In addition to a 13-month development delay and a production aircraft cut of 122, another low-rate initial production lot (LRIP 9) is being added to the program. Donley declined to say whether the airframe, managed by Lockheed Martin, or the engine, handled by Pratt & Whitney, contributed to more of the cost growth. Carter’s ADM notes that the F135 engine experienced “substantial cost growth.”

Donley says there is a “program management clutch,” during which officials are making the “transition from all the independent estimate data back into resetting and restructuring the program.” Ground-based testing on items such as materiel, fabrication and load trials have produced positive results, although not enough flight testing has taken place for an assessment. “These are not unusual issues for where this program is in making the transition from development into production. This is typical from every flying machine that you can think of,” he says, noting that it is more expensive to stop and then restart production lines.

The Pentagon is in the midst of negotiating LRIP Contract 4, and Donley seems sanguine that Lockheed Martin can produce the aircraft below prices cited in the JET II report. This could allow the Defense Dept. to buy more aircraft per year than planned; Donley declined to say how many more could be bought.

Carter’s ADM states that the Pentagon is making preparations to buy long-lead items for 48 aircraft in Fiscal 2011; the official request is for 43. This indicates a hope that five extra aircraft can be purchased in Fiscal 2011. “We should be working up the learning curve and down the cost curve,” Donley says.

Photo: Lockheed Martin