Productivity and Cost Reduction Management for Defense Acquisitions

Pratt & Whitney’s $66 Billion F-35 Engine Program Under Review
January 10, 2020

Pentagon auditing whether subcontractor prices are coming down.
The Pentagon’s audit agency is digging into cost and pricing data for F-35 engines to determine why  Pratt & Whitney unit is not giving more cost savings on engines. The agency’s review was initiated as  Pratt & Whitney quoted  cost savings of about 3% only in its prices for the 12th through 14th F-35 contracts  over the prior contract. By contrast, Lockheed Martin Corp., which builds the rest of the plane, is offering savings of as much as 15.3%. Defense Department’s F-35 program office flagged that the engine price is not coming down as fast as the air vehicle and it needs to be investigated using all the tools available to increase productivity and reduce costs.
https://www.bloomberg.com/news/articles/2020-01-10/pratt-whitney-s-66-billion-f-35-engine-program-under-review


May 7, 2019
F-35 DCMA Evaluates DoD goals

DCMA Lockheed Martin Fort Worth (LMFW) , Texas, which serves as the program’s flagship command and main production facility.

In its own pursuit of sound decision making, LMFW seeks efficiency and effectiveness.
For the American taxpayer, program cost is also important along with the effectiveness.  It is  a primary focus area for the JPO and DCMA.

Driving down cost is critical task. JPO and DCMA remain focused on aggressively reducing F-35 cost and delivering best value. LRIP 11 met its cost-reduction goals. DCMA team played a role in that cost savings through its Integrated Cost Analysis Team (ICAT), which consist of price analysts and engineers.  The ICAT’s Cost and Pricing Report includes analyses on proposed material, labor, other direct and direct estimating factors, and indirect and overhead costs.
https://www.dcma.mil/News/Article-View/Article/1816473/program-reflections-as-f-35-production-grows-dcma-takes-aim-at-dod-goals/