Amid rumors in the Pentagon and industry that General Electric had to shut down its Joint Strike Fighter test engine because of extreme vibration, the company came out swinging today, saying anybody who suggested this "is a bald faced liar."
GE's F136 spokesman, Rick Kennedy, said that "what we have learned is we improperly installed the sensors. There are no systemic or vibratory problems with the engine." He said the engine was running at "spool speed," about 102 percent.
Meanwhile, Pratt & Whitney sources said they planned to present an offer to Maj. Gen. David Heinz, JSF program executive officer, of a "hard goal" of a 30 percent reduction in cost for the F135 engine by the time it reaches the midpoint of production, at engine 250. In addition, in the short term they want to cut reduce costs for LRIP 4 -- some 36 engines -- by 10 percent from LRIP 3.
But the crux of the matter for Pratt was summarized in the House report accompanying the 2010 defense authorization bill: "The F–35 program manager reports that as of the end of 2008, development costs have grown to $6.7 billion in then-year dollars, an increase of $1.872 billion, or 38 percent. Additionally, the committee notes that the F–35 program manager has reported an increase of approximately 38 to 43 percent in F135 engine procurement cost estimates between December 2005 and December 2008, in the annual selected acquisition reports for the F–35C and F–35A variants. Between December 2005 and December 2008, engine procurement cost estimates for the F–35B have grown approximately 47 percent, but the F–35B engine procurement cost growth is attributable to both the F135 engine and the F–35B’s lift fan. Conversely, the F136 engine program has not experienced any cost growth since its inception. The F136 pre-EMD contract, which began in 2002 and was completed in 2004, was for $411.0 million and did not experience cost growth. The F136 EMD contract was awarded in 2005, and the cost estimate, at $2.486 billion, has been stable since contract award."
So you have one engine program which is growing in cost and one which has not grown. And you have GE looking at that cost growth and sensing an opportunity. The company has been in discussions with Heinz and other program officials since April about a fixed price contract for the 100 engines it hopes to sell. "We said, let's take those 100 engines that would be cost-plus and we would put those on a fixed-price basis," Kennedy said.
One of the hidden drivers behind those discussions was the Weapons Systems Acquisition Reform Act. Kennedy said his company is trying to "show Gates and Congress that we are complying with the spirit and letter of the law and providing benefits of competition now."
All this takes on greater urgency for Pratt as the company faces an independent Joint Assessment Team, created by Pentagon acquisition czar Ash Carter, to find out just what is the state of the engine program.
