- DEPARTMENT OF DEFENSE APPROPRIATIONS FOR FISCAL YEAR 2014

[Senate Hearing 113-]
[From the U.S. Government Publishing Office]

DEPARTMENT OF DEFENSE APPROPRIATIONS FOR FISCAL YEAR 2014

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WEDNESDAY, JUNE 19, 2013

U.S. Senate,
Subcommittee of the Committee on Appropriations,
Washington, DC.
The subcommittee met at 9:36 a.m., in room SD-192, Dirksen
Senate Office Building, Hon. Richard J. Durbin (chairman)
presiding.
Present: Senators Durbin, Reed, Cochran, Shelby, Collins,
Murkowski, Coats, and Blunt.

DEPARTMENT OF DEFENSE

STATEMENT OF HON. FRANK KENDALL, UNDER SECRETARY FOR
ACQUISITION, TECHNOLOGY AND LOGISTICS

OPENING STATEMENT OF SENATOR RICHARD J. DURBIN

Senator Durbin. Thank you all for joining us this morning.
The subcommittee meets to receive testimony on the fiscal
year 2014 budget, the request for the Joint Strike Fighter
(JSF) program, to review its cost, schedule, performance, given
that it is the largest acquisition program in the history of
our Nation.
To provide some context, since its inception, the
Department has invested $44 billion to develop these aircraft.
For fiscal year 2014 alone, the President's budget request for
the Joint Strike Fighter program includes $8.7 billion to
continue development of test and procure 29 aircraft, operate
and sustain the growing fleet, and begin a formal modification
program.
For today's hearing, there will be two panels. On the first
panel, I will welcome Under Secretary of Defense for
Acquisition, Technology and Logistics, the Honorable Frank
Kendall. Thank you for coming. Chief of Naval Operations,
Admiral Jonathan Greenert. Admiral, thank you for being here.
Chief of Staff of the Air Force, General Mark Welsh. General,
thank you. Assistant Commandant of the Marine Corps, General
John Paxton. General, thank you. Program Executive Officer for
the Joint Strike Fighter program, Lieutenant General
Christopher Bogdan. Thank you.
On the second panel, we are going to hear from the Director
of Operational Test and Evaluation, the Honorable Michael
Gilmore; Director, Government Accountability Office Acquisition
and Sourcing Management Team, Michael Sullivan; and Senior
Fellow and Director of Research, Brookings Foreign Policy
Program, Michael O'Hanlon. Gentlemen, thank you for being here
and providing your testimony.
I have been concerned about the defense acquisition
programs that obviously cost taxpayers billions of dollars more
than what the Department and Congress originally signed up for.
The Joint Strike Fighter program has had more than its share of
problems over the last decade. Frankly, its history reads like
a textbook on how not to run a major acquisition effort.
For instance, the Government turned over complete oversight
responsibility to the prime contractor on a cost reimbursement
contract, resulting in questionable design decisions, some cost
overruns and schedule delays. And the extreme overlap between
development and production, also known as concurrency,
guaranteed the unit costs of the aircraft would be considerably
higher than the $69 million per copy we originally planned.
That said, after many challenging years of development, I
am told that the program is starting to turn the corner in
terms of cost and schedule. The most recent selected
acquisition report shows the aircraft unit cost decreasing
slightly by 4.2 percent. Moreover, projected concurrency costs
to modify production aircraft have decreased by 47 percent, and
durability testing is showing the aircraft's structure is
reacting within normal limits.
Now, I look forward to hearing testimony addressing these
achievements later today, as well as a better understanding of
how we reached this point in the acquisition process. I want to
hear what steps are being taken to ensure that we learn from
this experience and not repeat mistakes.
Given the difficult budget challenges facing our Nation,
this hearing must also address the remaining development risks,
the entire cost of the program, the relevance to the future war
fight, and whether any other options are being considered for a
less costly future mix of tactical fighter aircraft.
Each of you will have an opportunity to provide an opening
statement, as well as to respond to questions, and I ask that
you keep your opening statements brief so we can have more
questions. And your full written statement, of course, will be
part of the record.
I now turn it over to Senator Cochran for opening remarks.

STATEMENT OF SENATOR THAD COCHRAN

Senator Cochran. Mr. Chairman, I am pleased to join you in
welcoming these distinguished witnesses to our hearing to
review the F-35 Joint Strike Fighter program and the funds
needed to provide for tactical aircraft.
This hearing should help us understand the threats to our
safety and security and the defenses we need to defend against
those threats.
We look forward to hearing your testimony and appreciate
your assistance to our committee.
Thank you.
Senator Durbin. Thanks, Senator Cochran.
Our first witness is Under Secretary of Defense for
Acquisition, Technology and Logistics, the Honorable Frank
Kendall. Frank, please proceed.

SUMMARY STATEMENT OF HON. FRANK KENDALL

Mr. Kendall. Thank you, Mr. Chairman.
I ask that our written testimony be admitted to the record,
please.
Chairman Durbin, Ranking Member Cochran, members of the
subcommittee, I am delighted to have the opportunity to discuss
the F-35 Joint Strike Fighter program with you today.
Obviously, this is a critical program for the Department and
our Nation. Air superiority and the ability to project power
from the air are central to the way our armed forces fight.
Other nations are developing capabilities that threaten our
technological superiority in the air, and we cannot afford to
be complacent about the decisive advantage we have enjoyed
since World War II.
I will let my colleagues from the Air Force, Navy, and
Marine Corps say more about the operational importance of the
F-35, and I will focus on the acquisition aspects of the
program.
My experience with the F-35 dates back about 3 years to the
spring of 2010. The Department's and my focus has been on the
efforts to control cost on the program and to achieve a more
stable design so that we could increase the production rate to
more economical quantities. Indications at this time are that
these efforts are succeeding, but we still have a lot of work
left to do.
We are now about 90 percent of the way through the
development program and 40 percent of the way through the
flight test program. Since the program was rebaselined,
following the 2010 Nunn-McCurdy cost breach, the program has
been executing with modest schedule slips.
Looking ahead, there is still risk in the schedule,
particularly with the final block of software called Build 3-F.
There is also the potential for surprise in the remaining test
program, including flight testing and fatigue life structural
testing.
Our intention is to complete the development effort within
the planned cost and schedule. However, we may need to make
some adjustments as events unfold. On the whole, however, the
F-35 design today is much more stable than it was 2 or 3 years
ago.
In 2011, I concluded that given the design issues we were
seeing at that time and the uncertainty about how soon they
would be resolved, that we were not ready to increase the
production rate on the program. The F-35 is one of the most
concurrent programs I have ever seen, meaning that there was a
high degree of overlap between the development phase and the
production phase of the program. Mr. Chairman, I understand
that this is of high interest to you and I would be happy to
address this subject in more detail in response to your
questions.
In our 2013 budget request, we kept the production rate
flat for the next 2 years. I seriously considered stopping
production at that time, but concluded that the cost and
disruption that would result would be considerable and that the
better course was to delay the previously planned increase in
production rate until the test program had progressed to the
point where we would have more confidence in design.
This fall, I will be reviewing the program to determine
whether or not we should plan to increase the production rate
significantly in 2015, as is currently planned. At this point,
I am cautiously optimistic that we will be able to do so.
With regard to cost, we are most of the way through
development and intend to execute the balance of the ongoing
development effort within the available funds. Since 2010,
production costs have been stable and are coming down, as you
mentioned, roughly consistent with our estimates. We have been
tightening the terms of production contracts beginning with Lot
4 in 2010, which is our first fixed-price incentive contract.
In Lot 5, we tightened the terms further and lowered cost
despite the fact that we did not increase the production rate.
For the first time in Lot 5, Lockheed was required to share in
the cost associated with design changes due to concurrency.
Lots 6 and 7 are currently in negotiation, and in these lots
and all future lots, Lockheed will bear all the risks of
overruns. At this point, we have a solid understanding of the
production costs and believe that they are under control.
Sustainment costs represent our greatest opportunity to
reduce lifecycle cost of the F-35 going forward, and we are now
focused on finding ways to introduce competition and to take
creative steps to lower those costs as well.

PREPARED STATEMENT

The bottom line is that since 2010, we have been making
steady progress to complete development, stabilize the design,
and control costs. We have a lot of work remaining, and we
should not be surprised if bad news does occur. We have still a
long way to go in the test program. But as I said, I am
cautiously optimistic that we will be able to increase
production to more economical rates beginning in 2015 as
planned.
Thank you, Mr. Chairman.
[The statement follows:]

Prepared Statement of Hon. Frank Kendall and
Lieutenant General Christopher C. Bogdan

Chairman Durbin, Vice Chairman Cochran, and distinguished members
of the subcommittee: Thank you for the opportunity to address this
subcommittee regarding the F-35 Joint Strike Fighter.
The F-35 is the Department of Defense's largest and most important
acquisition program. Its success is of fundamental importance to our
national security. The JSF will form the backbone of U.S. air combat
superiority for generations to come. It will replace legacy tactical
fighter of the Air Force, Marine Corps and the Navy. The F-35 will
provide a dominant, multirole, fifth-generation aircraft capable of
projecting U.S. power and deterring potential adversaries across the
full spectrum of combat operations. For our international partners and
foreign military sales customers, the JSF will become a linchpin for
future coalition operations, will help to close crucial capability
gaps, and will enhance the strength of our security alliances. Military
technology does not stand still, and maintaining technological
superiority our service men and women have relied upon effectively for
decades depends on the successful fielding of the F-35.
The multirole F-35 is the centerpiece of the Department of
Defense's future air dominance and precision attack capabilities. The
F-35's 5th generation attributes, including integrated advanced
technology sensors, networking, and signature controls, are critical
for maintaining U.S. air supremacy and ensuring our ability to operate
against modern and emerging threats. The emergence of competitor 5th
generation aircraft within the next decade; coupled with the
proliferation of sophisticated electronic warfare capabilities and
modern integrated air defense systems increasingly threaten our current
4th generation aircraft. The F-35 is designed to control the air and to
penetrate heavily defended environments in order to deliver a wide-
range of precision munitions. Shared development and international
production will bring the added benefit of increased allied
interoperability and cost-sharing across the Services and partner
nations. The President's fiscal year 2014 budget request includes a
total of $8.3 billion for continued system development ($1.8 billion)
and procurement ($6.5 billion) of an additional 29 F-35 aircraft. To
ensure the F-35 maintains its effectiveness against continually
evolving threats, this request also includes resources to deliver
advanced weapons and sensors to the F-35 fleet in the years following
Initial Operational Capability for our Services. The Department also
endeavored to protect the development of the F-35 Program this year as
it adjusted its budget to execute the mandates of sequestration. The
Department has requested a reprogramming of $75 million to keep the
development program on schedule and we urge the subcommittee's support
for this request. Ensuring the success of the F-35 development program
and achieving a stable design that will permit increased and more
economical production rates have been among my top priorities. I would
also ask this subcommittee to help us maintain funding stability in the
F-35 Program as you review the fiscal year 2014 President's budget
request.

WHERE THE PROGRAM HAS BEEN

Three years ago, the program experienced a critical unit cost
breaches according to the Nunn McCurdy statute. My predecessor, now
Deputy Secretary of Defense Ash Carter, rescinded the Milestone B and
Acquisition Program Baseline. The Nunn McCurdy breach resulted from
overly optimistic perceptions of development risk and an overly
aggressive, concurrent acquisition strategy. The critical review and
rebaselining process included an examination of all aspects of the
program and led to significant changes in how the F-35 program is
managed and executed. After elevating the Program Executive Officer to
a three-star flag officer billet and bringing in Vice Admiral Dave
Venlet from the Naval Air Systems Command to be the Program Executive
Officer, the Department executed a detailed Technical Baseline Review
to reassess the time and resources required to complete development
prior to resetting the Baseline and certifying the program. To address
the technical risks identified by that review, the Department added 2
years and $4.6 billion to the development and test programs. We also
made significant changes to our technical and contractual relationships
with Lockheed Martin, the prime contractor. To ensure Lockheed Martin
shared equitably in program risks and to incentivize cost reduction, we
began the transition from cost-plus production contracts to fixed
price-type contracts beginning with a fixed-price incentive-fee
contract for Lot 4. In Lot 5, the 2011 Lot, we continued this process,
tightening contract terms and obtaining a cost sharing agreement with
Lockheed Martin for concurrency risk--the costs associated with
implementing design changes to fix problems identified in testing on
aircraft that had already been manufactured. We are currently
negotiating fixed price-type contracts for production Lots 6 and 7,
under which the contractor will be assuming the risk for any cost
overruns. With me today is the current Program Executive Officer, Lt.
Gen. Chris Bogdan, who is focused on continuing to execute these
changes and deliver this critical warfighting capability to the U.S.
Services and our international partners. Also here today is Sean
Stackley, Assistant Secretary of the Navy for Research, Development and
Acquisition and Dr. William LaPlante, Principal Deputy Assistant
Secretary of the Air Force for Acquisition and Management. All of us
are fully dedicated to the success of this program.

PROGRAM ACCOMPLISHMENTS IN THE LAST YEAR

Flight test is progressing close to plan and is about 40 percent
complete. To date the F-35 Program has flown more than 3,000 flights
totaling more than 5,000 flight hours and is largely tracking to our
re-baselined plan. The first in-flight weapons releases were conducted
from both the Air Force's F-35A conventional take-off and landing
variant and the Marine Corps' F-35B short take-off/vertical landing
version and the program also began testing the most dynamically
challenging portion of flight envelope testing. Flight testing of the
aircraft's maximum design speed, maximum altitude and high angle of
attack flight characteristics, has been successful to date. On June 5,
2013, the integrated test team at Edwards Air Force Base conducted the
first powered launch of an AIM-120 Advanced Medium-Range Air-to-Air
Missile from an F-35A. Dynamic Load Testing models of the F-35A and F-
35B have completed their first lifetime (8,000 hours) of structural
fatigue testing, with the F-35C scheduled to complete in July. After
tearing down the aircraft, analyzing the results, and making any
necessary modifications, each variant will move on to a second lifetime
of testing over the coming year. The program also completed a U.S. Air
Force operational evaluation that cleared the way to begin pilot and
maintenance training at Eglin Air Force Base (AFB). The Marine Corps
and Air Force now have thirty-nine (39) F-35's deployed to operational
and training squadrons at four locations and have completed over 1,500
sorties totaling 2,000 flight hours. The program has completed initial
training for the transition of nearly fifty (50) pilots and over seven
hundred (700) maintainers. The Marine Corps activated the first F-35B
squadron at Marine Corps Air Station (MCAS) Yuma, Arizona and now has
six aircraft flying. None of these aircraft are fully operational of
course; that cannot occur until operational software completes
development and test and is fielded. The Services also recently
informed the Congress of their plans for establishing Initial
Operational Capability (IOC), indicating their confidence in the
program's ability to deliver capabilities on schedule. Concurrency
costs are coming down faster than program estimates, and production
costs are coming down as well. The price of producing F-35s continues
to decrease for each successive lot placed on contract; Lot 5 aircraft
averaged 4 percent less than Lot 4's, as did the price for Pratt &
Whitney's engines. We expect such reductions to continue.

INTERNATIONAL PARTNERSHIP

The F-35 program continues to be the Department of Defense's
largest cooperative development and production program, and with eight
original Partner countries all continuing their participation under
Memorandums of Understanding for System Development and Demonstration
(SDD) and for Production, Sustainment and Follow-on Development (PSFD).
The eight partner countries are the United Kingdom, Italy, The
Netherlands, Turkey, Canada, Australia, Denmark, and Norway. I recently
met with my international counterparts at our annual Chief Executive
Officer's Conference and I can assure you that the partnership remains
strong and committed to the program. Over the last few years,
individual partner nations have modified their procurement plans to
reflect the program's progress and the available funding in their
defense budgets, in a manner similar to the changes in our own
procurement plans. However, at this time each considers the F-35 a key
to their national defense and remains committed to the program. Turkey
deferred the two jets they had ordered in LRIP 7 (2012), deciding to
revisit their production decision in time to join LRIP 9 (long lead--
2014; on contract in 2015). The Netherlands first two aircraft are
being readied for delivery this year to train Dutch pilots to
participate in operational testing. The Netherlands Ministry of Defense
is fully committed to the F-35, awaiting conclusion of parliamentary
budget debates this summer to determine the timing for the next Dutch
aircraft order. Lastly, Canada continues to fulfill the requirements in
its mandated CF-18 replacement process with the next update due to
Parliament the fall. The process is not anticipated to complete with
this update.
In addition to development and production with our international
partners, there is robust activity in the Foreign Military Sales (FMS)
arena. Delivery of Israel's first of nineteen (19) F-35A aircraft is
scheduled to begin in 2016, with current plans for seventy-five (75)
Israeli F-35's. Japan signed a Letter of Offer Acceptance (LOA) for
four F-35A variant aircraft in June 2012 to be delivered from the
Lockheed Martin assembly line in 2016. Thirty-eight (38) follow-on
aircraft will be produced in a Final Assembly and Check-out Facility
(FACO) built in Japan, with deliveries beginning in 2017, for a total
of forty-two (42) aircraft. Japan's Ministry of Defense continues to
plan for additional production to replace their aging fighter fleet;
and a decision on the replacement aircraft is expected by 2017. Last
June the F-35 team provided a proposal to the Republic of Korea, which
is also competing for the acquisition of its future fighter. We expect
Korea's decision by the end of this month. Should the F-35 be selected,
deliveries would commence in 2017. The Singapore Air Force is currently
working with the F-35 program through a Studies and Analysis FMS case
leading to a potential request for acquisition later this year.

WHERE WE ARE NOW

The F-35 program continues to make steady progress. I believe we
have a realistic plan in place. We are seeing progress close to plan
but challenges and risks remain. We still have a long way to go in the
flight test program, with over 50 percent of the flight test remaining,
and have a good deal of development to complete, particularly software
and weapons integration.
While the program did experience significant schedule and cost
growth prior to the 2010 Nunn-McCurdy cost breach, the Department's
actions and our experience over the last 3 years reflect that the
program is on a more stable footing. Our focus now is on completing
development, which will permit ramping up to increased economies of
scale in production, and on getting support costs down.

COST, SCHEDULE AND PERFORMANCE

The Department is focused on executing the development program with
discipline to ensure the program delivers the planned for capabilities
within the time and funding that has been budgeted.
Unit Recurring Flyaway (URF) costs are on track to meet the
affordability targets that I established during the MS B
recertification in 2012. The transition to fixed price production
contracts is helping with this positive trend, but to meet our cost
goals the Department must ramp up the production profile. In 2012, I
flattened production because of excessive concurrency risk and concern
about the stability of the design. The situation today has improved to
the point that I am cautiously optimistic that we will be able to
increase production in 2015 as planned, provided development and test
progress continues to show improvement and costs risks associated with
concurrency continue to decline.

DEVELOPMENT STATUS

Over the past 2 years the Program Office has implemented
significant changes in how system software is developed, lab tested,
flight tested, measured and controlled. These changes are showing
positive effects, and we are moderately confident that the program will
successfully release the Block 2B and 3I capability as planned in 2015
and 2016. Block 2B is our initial combat capability, which the U.S.
Marine Corps plans to use to declare their IOC. Block 3I will have the
same operational capabilities as Block 2B, but includes a hardware
upgrade of the aircraft's computers. The Air Force plans to declare IOC
with the Block 2B/3I capabilities by December 2016. However, there is
more risk to the delivery of Block 3F, required for Navy IOC and the
Services' full warfighting capability, by late 2017. The F-35 Program
Office is conducting a Block 3 Critical Design Review early this
summer. The results of this review, coupled with a solid 6 months of
flight testing on our 2B software, will allow the Department to
determine the likelihood of meeting its Block 3F commitments on time. I
expect to have more definition regarding Block 3F capability at the end
of the summer, but we do see risk in the Block 3F schedule at this
time.
While software development and integration is the highest risk the
program faces as we complete development, there are other risks we are
tracking that warrant management attention. Among these are the Helmet
Mounted Display System (HMDS), the Arresting Hook System (AHS) for the
F-35C (carrier variant), and the Autonomic Logistic Information System
(ALIS). The HMDS is a major technological advance for pilot situational
awareness but it has presented design challenges. HMDS issues faced by
the program over the past year were ``green glow,'' or insufficient
helmet display contrast; latency of the displayed information;
``jitter,'' or lack of stability of the displayed symbology as the
aircraft maneuvers; night vision acuity; and alignment of the displayed
symbology. Last year the program made significant progress against
these challenges using dedicated HMDS flight testing to identify and
analyze acceptable HMDS performance. As a result of testing, the
program has successfully mitigated the effects of four of these HDMS
issues. More work is planned this summer to ensure that the night
vision camera is effective for Marine Corps operations. All of these
systems still pose moderate risk, but the program has well-planned and
resourced mitigation plans in place for each. I would categorize these
as typical of challenges associated with a complex weapon system
development program, but design and production concurrency have
rendered them more acute in the F-35's case.
It is important to note the impact our budget uncertainty has had
on the program, specifically in the test program. The devastation
caused by sequestration and the future furlough of our civilian
workforce are real. Although these are not typical challenges, they are
our reality and are increasingly difficult to recover from. For
example, we estimate a minimum impact to our testing schedule of a 1
month slip due to the furlough of Government test personnel. We
continue to assess the effects downrange from furlough to our
activities on this and other programs, as this is new territory for us
in terms of understanding the full impacts.

PRODUCTION STATUS

Overall, production performance is tracking to the post-strike
Lockheed Martin baseline and the aircraft production quality is
improving. As of June 10, 2013, the program has delivered a total of
fifty-six (56) aircraft--twenty-five (25) for testing and thirty-one
(31) for operations and training.
In the fall of 2012, the F-35 Program Office was alerted to a case
where noncompliant specialty metals were used in the manufacturing of
the F-35 Radar. The metals in question are in small high performance
magnets that are embedded in the lowest levels of the F-35 supply
chain. The noncompliance does not refer to the quality of these
materials but to their country of origin. Following a thorough review,
and after the required congressional notification, I determined that a
National Security Waiver was appropriate to allow acceptance of
aircraft containing these noncompliant high performance magnets. There
was no risk associated with the use of the materials and the time
required to re-qualify a compliant high performance magnet would have
resulted in major delay to the production and fielding of the aircraft.
Subsequent to the discovery and disclosure of this noncompliance, a
complete assessment of the supply chain bill of materials was completed
and two other instances where noncompliant specialty metals were being
used in the manufacturing of the F-35 Radar and Target Assemblies were
discovered. I both amended my earlier National Security Waiver and
issued a new National Security Waiver to cover these instances of
noncompliance in order to ensure that the production and testing
timeline for this critical program would not be negatively impacted
until compliant parts could be qualified and obtained. I can assure you
that the Department and I take this matter extremely seriously. I have
personally met with the prime contractor to discuss its corrective
action plans and have tasked the Defense Contract Management Agency to
review the reasons behind the noncompliance on the target assemblies.
In addition, the program office has insisted that the prime contractor
institute aggressive and thorough measures to identify any additional
instances and correct its specialty metal compliance process.

CONCURRENCY COSTS

As I mentioned, structural fatigue testing is proceeding according
to plan and one of the biggest concurrency risks--that of a significant
structural redesign--is decreasing accordingly. The quantity and
significance of test findings to date have been consistent with or
better than what we have seen on past fighter programs.
Predicted concurrency costs are coming down with the execution of
flight testing. Additionally, the projected concurrency costs per
aircraft are being revised downward due to a number of initiatives. In
the summer of 2012, the F-35 Joint Program Office (JPO) and Lockheed
Martin (LM) created a joint JPO-LM Concurrency Management Team. Their
first tasks were to identify the key drivers of concurrency costs,
develop a discrete bottoms-up cost estimate, and work collaboratively
to mitigate expected concurrency impacts. The new cost model reflects a
detailed engineering approach informed by the remaining F-35
qualification, flight test, and ground test events. The F-35 program
has taken measures to improve management of concurrency risk and
minimize the costs of delivering warfighting capability to the Services
by reducing the time required to implement changes to the production
line, where these modifications are cheapest, and ensure that fewer
aircraft need post-production retrofits. These included introducing
incentives to the Lot 5 and beyond production contracts so that
Lockheed Martin absorbed a reasonable share of the risk and cost of
discovering and implementing concurrency changes during production.

SUSTAINMENT COSTS

The operation and sustainment (O&S) costs estimate reported in this
year's Selected Acquisition Report (SAR) to Congress is unchanged from
the independent cost estimate the Director of the Cost Assessment and
Program Evaluation office (D, CAPE) provided to support the Defense
Acquisition Board's 2012 Milestone B Nunn-McCurdy recertification
review. It will be updated for the fall 2013 Interim Program Review
DAB, based in part on the program's cost data gained from operations at
Eglin AFB and MCAS Yuma.
The SAR reflects O&S costs that total $617 billion in constant year
2012 dollars or $1,113 billion in then-year dollars; the then-year
estimate highlights the inflationary impacts of operating those
aircraft beyond the year 2065. The cost per flight hour (CPFH)
reflected in the SAR is also the unchanged D, CAPE estimate. I
established CPFH affordability targets during the MS B recertification,
and we are working to achieve reductions that will bring the program in
below these targets to ensure the F-35 is affordable as we transition
to the operations and sustainment phase.
The Department, Services, and F-35 Program Office have undertaken
numerous initiatives to explore ways to reduce total O&S costs. At this
point, the O&S costs represent the best remaining opportunity to reduce
program costs. These initiatives include:
--Conducting a Sustainment Business Case Analysis using independent
reviewers.
--Injecting competition in sustainment areas to include managing the
global supply chain, producing support equipment, operating our
training centers and administering ALIS in each of our bases
and squadrons.
--Instituting a robust Reliability and Maintainability program to
systematically identify parts and systems on the aircraft today
that require repairs too frequently.
--Standing up the organic depots to improve the quality, throughput,
and turn-around times for parts repairs.
While we are being aggressive in our efforts to reduce overall O&S
costs, our current estimates are just that--estimates. My confidence in
our cost estimates will improve when we have actual costs based on
sustaining broad operational employment and can benefit from the
learning and experience of our warfighters.

FUTURE OF THE TACTICAL FIGHTER INDUSTRIAL BASE

The Department is concerned about the future of the United States'
high performance tactical aircraft industrial base. We are on the path
to having one active fighter production facility in the next few years,
but even more disconcerting is the gap between development programs for
the F-35 and the next generation of high performance aircraft.
Approximately a year ago, the Defense Advanced Research Projects Agency
was tasked by the USD(AT&L) to begin the ``Air Dominance Initiative,''
a program envisioned as leading to competitive prototyping programs for
the next generation of air dominance systems technologies beginning in
2016. In the current austere budget climate it will be difficult to
find resources to maintain and advance our competitive technologies for
high performance tactical aircraft, but it is important that we do so.
Programs such as the Unmanned Carrier Launched Air System can fill
part, but not all, of this gap.

CONCLUSION

The Department has a realistic baseline in place and we are seeing
steady progress in the program. The Department remains committed to the
F-35 as the core of our U.S. combat air superiority and precision
strike capabilities for generations to come. The capabilities of the F-
35 are necessary to our continued technological superiority on the
battlefield. Over the past few years, the Department has put in place
the right fundamentals and realistic plans using sound systems
engineering processes, and we are monitoring and tracking performance
using detailed metrics. Overall, there is much work still ahead of us
and there is still the possibility that we will be surprised during the
balance of the development and test program, but at this time we
believe we have put the program on a much more stable footing then it
had prior to the Nunn McCurdy breach in 2010.
Thank you again for this opportunity to discuss the F-35 Joint
Strike Fighter Program. We look forward to answering any questions you
have.

Senator Durbin. Thank you, sir.
Chief of Naval Operations, Admiral Greenert.

STATEMENT OF ADMIRAL JONATHAN W. GREENERT, CHIEF OF
NAVAL OPERATIONS, UNITED STATES NAVY
Admiral Greenert. Thank you, Chairman Durbin, Vice Chairman
Cochran. Thanks for the invitation to discuss the future of
naval aviation here this morning.
Today's topic, for me, the F-35C, is really a key part of
our future. It provides a unique and essential set of
capabilities for our air wing and for our carrier strike group
and effectively for the fleet, and it will dramatically enhance
the near-term and the future air wing capability immediately
upon its integration.
Now, as we prepare to integrate this aircraft, we are
focused on three things: One, to ensure that the F-35C delivers
on the requirements that we validated that we need; two, to
make sure that integrating the F-35 Charlie into our air wing
is effective and that it conforms to the carrier--it has to fit
into the air wing; and third, to understand the concepts
required for affordable operations and sustainment.
Now, with regard to capability, we need the stealth. We
need their advanced electronic warfare (EW) sensors, the
weapons, and perhaps more importantly, the command and control
capability that this aircraft brings. With its stealth and its
EW capability, it effectively enables us to be closer to the
threat. You can fuse targets. That means as you detect targets,
you can bring them together, determine what is what, what is
the threat, and build a common operational picture, and you can
engage first. And perhaps just as important, the F-35 Charlie
is designed to share this operational picture with other F-35s,
other tactical aircraft, including our Super Hornet and the
other aircraft in the air wing, other ships, other platforms
via our tactical data links. So it really is a force multiplier
in addition to be an incredibly capable aircraft.
With regard to integrating the F-35C into the carrier and
into the air wings, our top challenge is to reconcile that we
need to get done before our IOCR. We need to get the software
program, the Block 3F capability, certified. It brings us
weapons, the EW systems that I just mentioned, and an aircraft
that meets the operational envelope certification. We need an
arresting hook that is durable, reliable, and precise. And we
need the helmet monitor display system which is being worked
right now with some deficiencies. We need that certified. And
as I mentioned before, to integrate, we need it to be carrier
compatible, if you will, and that at-sea evaluation will start
next year.
Based on the Joint Program Office projections, we are on
track for this with some risk, particularly in the software
certification.
Now, with regard to understanding and addressing our
operations and sustainment, we have a lot of work to do, but I
think we have adequate time to prepare to integrate the F-35.
We are conducting a business case analysis on the level of
repair effort, the logistics, the maintenance schemes that we
will use, and we have tri-service meetings. That means I meet
with my service chief counterparts quarterly, and we meet with
the Joint Program Office quarterly to go over these sorts of
things.
The CONOPS--we will need a concept of operations to have
been established to settle what the flying hour cost is going
to be. In other words, what are my flying habits for this type
of aircraft? Simulation, which is very advanced, versus
training versus proficiency flying. I need to determine what is
the best estimate for the cost to fly this aircraft and we will
work through that. We have a mandate that Mr. Kendall has given
us. And right now, we look and project we will meet this
mandate, but this is something we have to focus on--we, the
fleet.

PREPARED STATEMENT

Our sustainment challenges are to be able to maintain this
aircraft in a maritime environment, saltwater, moving ship and
a carrier, human environment. It is hot. It is dusty. And how
do we maintain this aircraft in that hangar bay? We need to be
able to repair the aircraft in my view, and that requires the
right parts and the correct scheme. And we need trained sailors
to do that. And if we are going to repair it, then we need
logistics, and we got to have an affordable logistics train and
one that is responsive.
So to me, Mr. Chairman, the F-35C is designed to provide
the capability we need, and I look forward to working with this
committee, with the Congress, and with the Program Office to
bring it into the fleet at an affordable rate. Thank you.
[The statement follows:]

Prepared Statement of Admiral Jonathan W. Greenert

Chairman Durbin, Vice Chairman Cochran, distinguished members of
the subcommittee, thank you for the opportunity to testify today on the
carrier variant of the F-35 Joint Strike Fighter (F-35C).
The F-35C will replace our F/A-18C Hornet fleet starting at the end
of this decade and provide essential and unique capabilities that
complement the rest of our carrier air wing (CVW). Our focus areas,
from today until the time F-35C enters the fleet, remain: Ensuring the
F-35C delivers the capability we need and expect, integrating F-35C
into our CVWs, and understanding and addressing the requirements to
sustain the aircraft and its payloads.

THE CAPABILITY WE NEED AND EXPECT FROM THE F-35C

The capability the F-35C is expected to deliver is needed to
provide Navy a strike-fighter with the stealth, sensing and command and
control capabilities for our future CVW to do two important missions:
assure access and project power. These missions require our aircraft be
able to overcome, by stealth, jamming or threat system destruction,
surface-to-air missiles, air-air missiles, tactical aircraft and
sensors. These threats and their components will continue to advance
and (likely) proliferate within the next decade--and may be employed
individually or collectively as part of more capable air defense ships
or integrated air defense systems. Our CVWs will need the F-35C's
contributions to assure access and project power in the future.
The F-35C is expected to operate closer to threats than the F/A-18
E/F Super Hornet because the F-35C has a lower radar signature and an
improved capability to detect, avoid and jam enemy radars. The F-35C is
designed to be able to use this access and its more sophisticated and
comprehensive suite of sensors to conduct ``first day'' attacks and to
establish an operational picture of the battlespace.
Equally important, the F-35C is designed to share its operational
picture with other aircraft--particularly the F/A-18 E/F--to enable
them to conduct strike and anti-air attacks with stand-off weapons. The
F-35C is expected to be able to integrate various active and passive
sensors from multiple aircraft (including F/A-18, E-2D Hawkeye, and EA-
18G Growler) into the F-35C's operational picture. This process
automatically formulates ``weapons-quality'' tracks for each target
that can then be shared with other aircraft and ships, enabling them to
engage the target.

INTEGRATING F-35C INTO OUR CARRIER AIR WINGS

At a minimum, the F-35C will need to initially deliver equivalent
capabilities to the F/A-18C it replaces in order for F-35C to integrate
into the CVW. These capabilities are the ability to operate on and from
the aircraft carrier and the ability to detect and engage aircraft,
ground targets and surface maritime targets. These capabilities will be
incorporated into F-35 as part of Block 3F, which makes this software
program and associated equipment (Block) necessary for F-35C to be
integrated into the CVW.
I am monitoring two other items needed to integrate F-35C into the
CVW: Redesign and testing of the Arresting Hook System (AHS) and
correction of problems with the Helmet Mounted Display System (HMDS).
Based on Joint Program Office (JPO) projections, the AHS will be
corrected within a year, while the HMDS will be addressed in the F-35A
and F-35B, before the Navy's F-35C is fielded. Based on JPO-projected
development timelines, testing milestones and carrier suitability
evaluations, the Navy has established February 2019 as our threshold
(minimum expected) Initial Operational Capability (IOC) date, with an
objective date of August 2018.

UNDERSTANDING AND ADDRESSING SUSTAINMENT REQUIREMENTS

The timeframe between now and threshold IOC affords the Navy
adequate time to prepare to integrate F-35 into the fleet. In addition
to integrating F-35C's warfighting capabilities into the CVW, the
system's maintenance and sustainment processes must be compatible with
our existing infrastructure--and the F-35C presents unique maintenance
and logistics challenges. For example, sustaining the Low Observable
(LO) signature of the aircraft will be a new challenge to Navy
maintainers. It is expected that there will be a learning curve in
order to properly maintain this critical feature in the relatively
harsh at-sea environment. Another challenge is the movement and
transfer of replacement (spare) engines onto a deployed aircraft
carrier, at sea around the world. Current fixed-wing, helicopter, and
ship-to-ship at-sea transfer methods are not capable of moving the
``Power Module,'' the largest module of the F135 engine; it is too big.
We are exploring different options to resolve these at-sea challenges
prior to IOC, and our first F-35C operational deployment.
There are additional challenges, from Navy's perspective,
associated with the builder's maintenance concept for F-35C. The
demands of CVW operation in an expeditionary environment have taught us
we need to be able to do maintenance, and some repairs, at sea. Our
Sailors accomplish many of the maintenance requirements for all of our
CVW aircraft at intermediate (``I-level'') maintenance facilities
inherent aboard the aircraft carrier at sea. Currently, the F-35C
program is not designed to incorporate I-level maintenance. The Joint
Program Office (JPO) has been requested to arrange for, and review, a
Level of Repair Analysis (LORA), which will be independently assessed
by a third-party, to study the business case of incorporating I-level
infrastructure into the F-35 program. This Tri-Service study will
examine avenues to optimize current processes and maintenance
investments which could save money, enable more repairs of F-35C to be
conducted at sea and increase the operational availability. The results
of this study will be available for all Services to consider. We are
also examining whether the F-35C's requirements for data ``reachback''
to support logistics orders and maintenance planning are suitable for
the forward maritime operating environment. Each of these aspects of F-
35C sustainment (logistics, repair and maintenance) impacts the cost to
sustain the F-35C, and we are working to understand them fully to
identify opportunities to reduce sustainment cost.

CONCLUSION

The Navy needs the capability of the F-35C and remains committed to
it as an essential component of our future CVW. However, we have some
challenges to work through to ensure it delivers the capability we need
and expect, integrate F-35C into our CVWs, and understand the
requirements to sustain F-35C. The JPO plans are designed to address
these challenges in the timeframe between now and when Navy intends to
field the F-35C.
Thank you again for the opportunity to appear before the committee
and I look forward to your questions.

Senator Durbin. Thanks, Admiral.
The Chief of Staff of the Air Force, General Mark Welsh.

STATEMENT OF GENERAL MARK A. WELSH, III, CHIEF OF
STAFF, UNITED STATES AIR FORCE
General Welsh. Thank you, Mr. Chairman, Vice Chairman
Cochran, members of the committee. We appreciate the
opportunity to be here this morning to discuss the importance
of the Joint Strike Fighter to our Nation's security, in my
view, and also any other tactical aircraft programs you would
like to address.
Since April 1953, the United States has deployed roughly 7
million American servicemembers to combat and contingency
operations around the world, and thousands of them have died
there, but not a single one has been killed by enemy aircraft.
The air superiority that this Nation has enjoyed for those 60
years is not an accident and gaining it and maintaining it is
not easy. It requires trained, proficient, and ready airmen,
and it requires credible, capable, and technologically superior
aircraft.
Air superiority is critical to our Nation's security, as
Mr. Kendall mentioned a moment ago. It is a fundamental pillar
of not just air power but a prerequisite to the American way of
modern joint warfare, and without it, our Nation's ground and
maritime forces would have to radically change how they go to
war.
I believe the F-35 is essential to ensuring we can provide
that air superiority in the future. Potential adversaries are
acquiring fighters on a par with or better than our legacy
fourth generation fleet. They are developing sophisticated
early warning radar systems and employing better surface-to-air
missile systems, and this is at a time when our fighter fleet
numbers about 2,000 aircraft and averages a little over 23
years of age, the smallest and the oldest in the Air Force's
history. America needs the F-35 to stay a step ahead, to make
sure that the future fight is an away game and to minimize the
risk to our ground forces when conflict inevitably does occur.
Its interoperability among the Services and partner nations,
its survivability against the advance integrated air defense
systems, and its ability to hold any target at risk make the F-
35 the only real viable option that I see to form the backbone
of our future fighter fleet.

PREPARED STATEMENT

Over the past 2 years, the program has shown steady
progress, and now it needs stability. I am proud to lead the
airmen who power the most capable air force on the planet and
they need the right tools, as you know and have helped them
get, to guarantee global vigilance, reach, and power for
America. The F-35 is one of those tools.
And I look forward to our discussion.
[The statement follows:]

Prepared Statement of General Mark A. Welsh, III

Chairman Durbin, Ranking Member Cochran, and distinguished members
of the subcommittee, thank you for the opportunity to discuss the Joint
Strike Fighter (JSF) and the future of tactical aircraft. Thank you
also for your support of our Airmen who are currently engaged around
the world executing our five core missions of air and space
superiority, intelligence, surveillance, and reconnaissance, rapid
global mobility, global strike, and command and control to provide
Global Vigilance, Global Reach, and Global Power for our Nation.
In January 2012, the Secretary of Defense issued new defense
strategic guidance (DSG)--Sustaining U.S. Global Leadership: Priorities
for 21st Century Defense--which serves as a foundational document both
to articulate national security interests, and to guide America's
military posture and procurement. To support this guidance, the F-35A,
along with the KC-46 tanker and the long range strike bomber, remain
the Air Force's top three acquisition programs. The F-35A will form the
backbone of our tactical aircraft fleet for many years, and will
replace our aging fighters with a dominant, multirole, fifth-generation
aircraft, capable of projecting power, deterring potential adversaries,
and winning future wars alongside similarly-equipped allies and
partners.

AIR SUPERIORITY AND GLOBAL STRIKE

The F-35A directly impacts two of our five core missions--air
superiority and global strike. While complementing the F-22's world-
class air superiority capabilities, the F-35A is designed to penetrate
integrated air defense systems (IADS) and deliver a wide range of
precision air-to-ground and air-to-air munitions against air defense
targets. These suppression and destruction of enemy air defense (SEAD/
DEAD) missions are a prerequisite to gaining air superiority. Air
superiority provides freedom of action for the entire joint force. In
fact, April 15, 1953, was the last time an American servicemember on
the ground was killed by an enemy aircraft. The air superiority that
America has enjoyed for over 60 years is not an accident, and gaining
and maintaining it is not easy. It requires a credible, capable fleet
of aircraft employing cutting edge technology to counter emergent
threats, as well as a trained, proficient, and ready force of Airmen to
fly them. As an Air Force, we are proud of the decades of consistent
delivery of air superiority that we have been able to provide the
Nation, and we believe it is our duty and obligation to continue and
preserve that core mission. Without air superiority, the joint team
would have to radically change how it goes to war, with U.S. and allied
operational success subject to much greater risk.
In terms of global strike, the F-35A will also pay dividends as we
re-focus our attention to the possibility of military operations in
contested environments. Our fighters and bombers have enjoyed relative
freedom from attack in Iraq and Afghanistan, but as increasingly
sophisticated and capable global anti-access/area-denial threats
continue to proliferate, the ability of our fourth-generation fighters
to penetrate contested airspace will wane. Much like the initial days
of the first Gulf War, when only the F-117 possessed the capability to
strike downtown Baghdad, the F-35A's survivability and lethality in
highly contested environments will help deter and defeat potential
adversaries anywhere on the planet, holding any target at risk, today
and tomorrow.

THREATS

Over the last 22 years, our military has fought four major regional
conflicts--Kuwait, Bosnia, Afghanistan, and Iraq, with the smaller-
scale enforcement of United Nations Security Council Resolution 1973
over Libya concluding just 18 months ago. However, our security
challenges persist across the globe from transnational terrorism in
Africa, to regional instability in the Middle East, to a nuclear-armed
North Korea. Our technological advantage is threatened by the worldwide
proliferation of advanced air defense systems such as the Russian-built
S-300 which has garnered recent headlines in Syria. Moreover, countries
are developing fighters on par or better than our legacy, fourth-
generation fleet. For example, China and Russia are currently testing
fifth-generation fighters, with China recently flying two new advanced
stealth fighters--the J-20 and J-31. These world-wide technological
advancements are occurring at time when our fighter fleet numbers about
2,000 aircraft and averages 23 years old, the smallest and oldest in
our history.

CAPABILITIES

While the Air Force's current fleet of fighters has excelled in
recent conflicts, the JSF is a necessity for future, high-end
engagement, providing increased survivability and lethality. Fifth-
generation survivability attributes include improved all-aspect
stealth, advanced electronic warfare systems, and fused mission systems
that provide unmatched battlespace awareness. It also includes the
necessary tactical air characteristics of maneuverability and speed. In
terms of lethality, the F-35A offers unprecedented data fusion and
situational awareness with powerful radars, sensors, and other high
performance capabilities that allow the successful prosecution of
advanced ground and air threats in any environment, to include the
dense high-threat environments characterized by double digit surface-
to-air-missiles (SAMs) and multilayered IADS. Our current fighters have
been modernized to incorporate some of the latest component
technologies, but they are at the limits of both modernization and
service life. We cannot modernize the fourth-generation fleet to the
level of survivability and lethality necessary to operate and prevail
in highly contested environments. Recapitalization of the tactical
fighter fleet through the JSF program best positions America's military
to meet the security challenges of today and tomorrow, and to fulfill
America's defense posture as expressed by the Defense Strategic
Guidance.
Future military operations will require partnership with
international partners and allies. The JSF's interoperability offers
another unique capability that will enable America's military and Air
Force to fight alongside our coalition partners seamlessly in the
future. In addition to shared equipment and costs,\1\ the JSF's
interoperability will lead to common tactics, techniques, and
procedures, mutual understanding of employment, and unprecedented
degrees of shared situational awareness. Such integration will greatly
enhance our ability to operate, survive, and succeed in future joint
and coalition environments. By employing the same world-class equipment
with similar procedures and tactics, we will be able to fully realize
the synergistic effects of fifth-generation joint and coalition
warfare.
---------------------------------------------------------------------------
\1\ International partners have provided over $4.5 billion for JSF
development.
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CURRENT STATUS

The fiscal year 2014 budget request includes $4.5 billion for
continued development and procurement of 19 F-35A conventional take-off
and landing (CTOL) aircraft. Aggressive risk management and refined
system engineering analysis contributed to an approximate 30 percent
reduction in concurrency cost estimates since 2011, and the program has
made significant strides overcoming technical challenges and software
development delays.
The Air Force has received 22 production aircraft, and these early
production deliveries have allowed us to begin the necessary ramp-up
for future operational tests, and to build our initial cadre of pilot
and maintenance instructors. To date, the program has completed over
1,400 CTOL test flights, comprising 46 percent of planned test points,
and testing the JSF to its full envelope--700 knots, over 50,000 feet,
over 50 degrees angle of attack, and multiple successful weapon
separation tests to include the first AIM-120 live launch. We also
completed the first life-durability test on the F-35A, a key milestone
that reduces concurrency cost risk to future low-rate initial
production (LRIP) lots.
During calendar year 2012, the JSF program conducted a successful
operational utility evaluation and started pilot training at Eglin Air
Force Base. We currently have 23 trained USAF pilots and 437 trained
maintainers at Eglin. We expect the first aircraft delivery to Luke
AFB--the first F-35A pilot training center--in February 2014, and to
our first partner there, Australia, in the summer of 2014. We will also
stand up the CTOL depot at Hill AFB this summer, and deliver their
first aircraft in October of 2013.
Building on the progress made so far and the steps we take today
are crucial in our efforts to declare F-35A initial operational
capability (IOC). After last year's program re-baseline, the joint
Services were tasked to provide Congress our updated IOC criteria and
timeline estimates. Currently, the Air Force plans to declare IOC in
December 2016 with a combat-ready squadron of 12 F-35As. The Air Force
will declare F-35A IOC when Airmen are trained and equipped to conduct
basic close air support, interdiction, and limited SEAD/DEAD operations
in a contested environment. The follow-on 3F software package will add
even more capability into the Air Force air superiority core mission by
enabling multiship suppression and destruction of enemy air defenses,
as well as enhanced air-to-air and air-to-ground modes. The 3F software
suite is expected in 2017 and should be included in LRIP lot nine
production aircraft.

SEQUESTRATION

We recognize that in the current fiscal environment, we must adapt
to expected resource constraints. The JSF program has seen significant
improvement in recent years, but the blunt effects of sequestration
threaten to disrupt that progress. Sequestration significantly impacts
every one of our investment programs, including the F-35A. Although
unit costs for the F-35A have been trending down due to relative
program stability, sequestration-induced disruptions to the program
could, over time, potentially cost more taxpayer dollars to rectify
program inefficiencies, raise unit costs, and delay delivery of
validated capability. In fiscal year 2013, we planned to procure 19 F-
35A aircraft. As a result of sequestration, we may have to reduce the
procurement quantity by at least three and potentially as many as five
aircraft.

CONCLUSION

The JSF is critical to our national security. This platform will
form the backbone of our tactical aircraft fleet for many years to
come, and will reinvigorate our aging fleet with a dominant, multirole,
fifth-generation fighter. The JSF will feature prominently in future
joint and coalition operations--flying with both U.S. and allied
markings--projecting power, deterring potential adversaries, and
winning future wars.
Although sequestration jeopardizes the stability of the program as
we struggle to simultaneously regain readiness and recapitalize the Air
Force's fighter and tanker fleets, we are committed to build upon the
many significant milestones the JSF program has achieved in recent
years. We have made great strides to reduce expenses across the life of
the program, but we need Congress to pass a defense appropriations
measure for fiscal year 2014 so that we can plan for the future. The
JSF represents an investment in the air superiority of our Nation. It
will assure that when America sends her sons and daughters to fight,
they will fight with the protection of American airpower overhead . . .
just as their brothers, sisters, parents, and grandparents have done in
every conflict since April 15, 1953.

Senator Durbin. Thank you very much, General.
Assistant Commandant of the Marine Corps, General John
Paxton.

STATEMENT OF GENERAL JOHN M. PAXTON, JR., ASSISTANT
COMMANDANT, UNITED STATES MARINE CORPS
General Paxton. Chairman Durbin, Vice Chairman Cochran,
distinguished members of the committee, thank you for the
opportunity to discuss the Joint Strike Fighter and its role in
the future of both the Marine Corps and our overall tactical
aviation.
As the Marine Corps modernizes its aviation fleet, the
continued development and the fielding of the F-35 Joint Strike
Fighter remains a top priority. The capabilities offered in
this jet are unequaled by anything in the world today. Within
the B version of this single platform, we obtained the most
lethal fighter characteristics, supersonic speed, low
observable radar evading stealth, extreme agility, and the
unmatched ability to collect, fuse, and disseminate
information.
The F-35B's short take-off and vertical landing (STOVL)
triples the number of airfields worldwide that the aircraft can
utilize, and combined with the F-35C carrier variant, it gives
the Nation double the number of capital ships that are capable
of operating a fifth generation multirole fighter. In today's
growing environment of anti-access and area of denial
technology, the ability of many more State and non-State actors
on the world stage to reach out and potentially touch surface
targets thousands of miles out to sea necessitates that America
consider and plan to have sufficient assets like these
available to combat these threats.
Our ability to tactically base fixed wing aircraft in the
hip pocket of our ground forces has long been instrumental to
our many successes on the battlefield, from the birth of our
marine aviation through today. The F-35B is the tactical
aircraft that we need to support our Marine Air Ground Task
Force from now into the middle of this century. The F-35C is
the tactical aircraft that we need to enhance our participation
in the Navy air's carrier air wings and their degree of power
projection from the sea.
The F-35 will replace three models, three type model
series, of aircraft that the Marine Corps currently operates.
It will replace all of our F/A-18 multirole fighters, our AV-8B
attack aircraft, and our EA-6B electronic aircraft. The F-35 is
more than just a new fighter. By replacing so many different
capabilities in our arsenal, it represents an entirely new way
of doing business including, as the CNO said a minute ago,
tactical command and control.

PREPARED STATEMENT

I thank each of you for your time, your interest, and your
support of our Nation and our military.
I request that my written testimony be accepted for the
record and look forward to your questions.
We are committed to always providing the Nation a force,
today's force for today's crisis today, and the JSF is key to
our ability to do that.
Thank you very much.
[The statement follows:]

Prepared Statement of General John M. Paxton, Jr.

Chairman Durbin, Ranking Member Cochran, and distinguished members
of the subcommittee, thank you for the opportunity to discuss the Joint
Strike Fighter (JSF) and the future of Marine Corps tactical aircraft.
As the Marine Corps modernizes its aviation assets, the continued
development and fielding of the F-35 Joint Strike Fighter (JSF) remains
a top priority. The F-35 will supplant the Marine Corps' aging Tactical
Aviation (TACAIR) fleet by replacing F/A-18 Hornets, AV-8B Harriers,
and EA-6B Prowlers. The incorporation of the F-35 aircraft into the
Marine Air Ground Task Force (MAGTF) will provide a dominant,
multirole, fifth-generation platform capable of full spectrum combat
operations in support of naval and joint forces. We are well into this
transition plan and failure to maintain both JSF production rates and
legacy aircraft service life extension programs will impact operational
readiness and aircraft availability.
While today's U.S. military force is highly adept, new challenges
are emerging from nations and non-State actors employing increasingly
sophisticated anti-access/area-denial (A2/AD) strategies. The
proliferation of A2/AD technology enables them to reach out and
potentially touch surface targets thousands of miles out to sea. This
necessitates America to consider and plan to have sufficient assets
available to combat these threats. While designed to meet an advanced
threat through low observable lethality and survivability, the F-35 JSF
will also bring enhanced intelligence, surveillance, and reconnaissance
(ISR) capabilities to the battlefield. The aircraft's ability to
develop, process, and display information to the pilot and disseminate
it to tactical, operational, and strategic levels is what makes the F-
35 truly unique and a critical node for the MAGTF across the entire
range of military operations. As the Nation's expeditionary force in
readiness, the Marine Corps must be prepared and able to operate in an
A2/AD environment from the sea and ashore to project influence and
power at a time and place of the Combatant Commander's choosing. USMC
F-35s will be a critical enabler of this capability.
The short take-off and vertical landing (STOVL) F-35B will provide
the MAGTF with flexible, expeditionary basing options required to
maintain the advantage in the future fight. Expeditionary basing
includes operating from amphibious ships and from remote locations
ashore where few airfields are available for conventional aircraft. Our
requirement for expeditionary tactical aviation has been demonstrated
repeatedly from the expeditionary airfields and agile jeep carriers of
World War II, to austere forward basing in Iraq and Afghanistan. Today
this concept has proven viable for operations in support of the ``new
normal''--a posture that requires an enhanced baseline of security at
U.S. diplomatic facilities and an increased vigilance marking the
cascading and deleterious effects of civil uprisings such as those that
occurred in Libya and Yemen. In short, the Marine Corps' ability to
tactically base fixed wing aircraft has been instrumental to our
success on the battlefield and on the world stage.
At sea, the F-35 can operate from both aircraft carriers and
amphibious shipping. The ability to employ the F-35B from 11 big-deck
amphibious ships doubles the number of ``aircraft carriers'' from which
the United States can employ a fifth-generation capability. The F-35B
also generates launch and recovery flexibility beyond U.S. Navy ships
by being cross deck compatible with all international conventional and
STOVL capable aircraft carriers.
While operating ashore, the F-35B is not constrained to major
airfields of 8,000 feet or more. The ability to operate from short,
less than 3,000 foot runways provides a more than three-fold increase
in the number of airfields worldwide that STOVL aircraft can utilize.
Additionally, STOVL aircraft can operate from expeditionary airfields
constructed from airfield matting or established on nonairfield
infrastructure such as highways or large parking lots; a capability
repeatedly demonstrated during Operation Iraqi Freedom and Operation
Enduring Freedom.
The Marine Corps' acquisition of the F-35C variant will continue
and enhance its current participation in United States Navy carrier air
wings. Carrier air wing capabilities of the future will be bolstered by
the F-35C's survivability and lethality against anti-access threats
that include advanced surface to air and anti-ship missile systems. In
the face of emerging threats, a carrier air wing's ability to project
power will rely heavily on the ability to detect, track and prosecute
targets while at the same time avoiding detection. Marine Corps F-35C
squadrons as part of United States Navy carrier air wings will be an
essential element of this power projection capability from the sea.
The F-35 will provide a dominating counter to a broad spectrum of
current and future threats while ensuring success on the battlefield
that cannot be addressed by current legacy aircraft. Continued funding
and support from Congress for the F-35 JSF program is of utmost
importance for the Marine Corps and our Nation.
On behalf of the Marines and Sailors who provide this Nation with
its versatile, reliable, middleweight force in readiness, I thank
Congress for your constant interest in and recognition of our
challenges. Your continued support is requested to ensure the Marines
Corps can proceed with the fielding of this aircraft, an aircraft that
for the first time in aviation history combines the most lethal fighter
characteristics--supersonic speed, radar-evading stealth, extreme
agility, a short takeoff/vertical landing capability, and the unmatched
capability to collect, fuse and disseminate information--all in a
fifth-generation platform. The capabilities offered in this jet are
unequaled by anything in the world today. It is a capability critically
needed by our Nation and your Marine Corps and a capability whose day
is rapidly dawning.

Senator Durbin. Thanks, General, and your statement will be
made part of the record, without objection.
Lieutenant General Bogdan.

STATEMENT OF LIEUTENANT GENERAL CHRISTOPHER C. BOGDAN,
UNITED STATES AIR FORCE, JOINT STRIKE
FIGHTER PROGRAM EXECUTIVE OFFICER
General Bogdan. Mr. Chairman, Ranking Member Cochran, and
distinguished members of the subcommittee, thank you for the
opportunity to discuss the F-35 program with you today. I will
be brief so we can get on to the Q&As.
The F-35 program is not the same program it was a number of
years ago. We have significantly restructured the program over
the past few years and created a much more realistic baseline
to the program. We have also adequately resourced the program
to meet our commitments in terms of manpower, technical
expertise, time, and money.
Relative to the program's schedule, we are executing with
minor delays today but are mainly on track to that schedule we
put in place in 2010. I am confident we will meet the
commitments from Block 2B and 3I which will allow the U.S.
Marine Corps to declare initial operational capability (IOC) in
2015, which will allow the Air Force to declare IOC in 2016,
and meet the commitments of our initial partners in terms of
delivering their planes to them.
I am less certain about our final capability 3F being
delivered at the end of 2017, and we can discuss that further
in the Q&As.
Affordability is my number one concern and my number one
priority on the program. Relative to development, we have taken
a mindset that we have no more time and no more money in the
development phase of the program, meaning that within the
resources we are given, we are committed to finishing the
program on time and within budget.
Relative to production costs, the cost of the airplane and
the cost of the engine are coming down lot after lot. I am
currently negotiating Lot 6 and 7 with Lockheed Martin and
Pratt & Whitney, and I expect that trend to continue many years
into the future, that the prices will continue to come down.
Relative to operations and sustainment costs, today the
Program Office is taking aggressive action on many fronts to
lower the lifecycle costs of this airplane, and I would be more
than happy to detail those during the Q&A. What we need to do
is ensure that our partners and the Services have an affordable
weapons system in the future, and the Program Office takes this
on very seriously.
Technically, I believe the design of the aircraft is sound,
and we have solutions to all the technical problems we see in
front of us today. That does not mean that in the future we
will not have other challenges and other discoveries, but I
believe we have the capability and the capacity to overcome
those.
And finally, I have been at the helm of the program for
about 6 months, and my promise to you and the enterprise is I
will continue to lead this program with transparency,
accountability, and discipline.
Thank you and I look forward to your questions.
Senator Durbin. Thanks, General.
And we will do 5-minute rounds of questions here. We have,
obviously, a great interest within the committee.
Let us concede a few points that have been made by
everyone. First, America wants to have air superiority--
period--over any possible enemy. Secondly, we owe it to the men
and women who are fighting to defend this country to give them
the very best that they can rely on to protect their own lives
and to perform their missions capably and successfully. Third,
we have a responsibility to the taxpayers in achieving that
goal to make sure we do not waste their money in the process of
developing an aircraft that meets those criteria.
Now, over 10 years ago, we had a competition for this
aircraft. I believe the notion behind the Joint Strike Fighter
was to finally try to harmonize the needs of our military
within the Services based on a similar or likeminded platform
that we were designing.
The question we have to ask ourselves today is what have we
learned over the last 10 years plus in terms of the development
of this aircraft. Mr. Kendall, you were pretty blunt at one
point. You stated your disagreement with the decision that
allowed the JSF to begin production before the first test
flight even occurred. You called it ``acquisition
malpractice.'' The decision made by your predecessors resulted
in the severe concurrency that the program continues to
experience today, almost 12 years later.
As the Under Secretary of Defense for Acquisition, you are
responsible for establishing the Department's acquisition rules
and regulations. What have we learned? What would you do to
limit concurrency in not only programs under your purview today
but future programs that we might consider?

CONCURRENCY

Mr. Kendall. Thank you, Mr. Chairman. I was going to bring
up that quote if you did not. It is the one that I think I most
often associated with.
When I first saw the schedule for the F-35, I was
surprised. I had not seen a program with that degree of
concurrency in my past experience. I talked to some of the
people who were involved----
Senator Durbin. Excuse me a second. Can you step back a
second and define ``concurrency'' in terms that the layman
would understand for the record?
Mr. Kendall. It is not unusual in any development program,
as you come towards the latter phases of the development
program, to start the production process. The key to doing that
successfully is that you have design stability, that you do not
expect to find anything in the test program, the balance of the
test program, or any additional software development that you
may be doing that will substantially change the design and
change the manufacturing process, change the tooling, force you
to go back and modify some of the product you have already
made.
The reason to do that, of course, is that you want to get
the product into the field as soon as you can. And there are
some efficiencies associated with making that transition
earlier. Sometimes it is threat-driven. Sometimes there is a
lot of urgency about getting the capability out because of the
threat. So it is a judgment call as to how much overlap you
have between the development phase of the program, particularly
the testing phase, and the actual start of production.
Historically for something like a new aircraft, a
sophisticated, new, cutting-edge design, we would be a year or
two into test flight before we started production. We did a
much more aggressive approach on the F-35. And my understanding
is that people felt at the time that the modeling and
simulation, that our design tools were much more sophisticated,
and that we would not see a lot of problems and find them
through the test program. That was wishful thinking, frankly.
It kind of flies in the face of all of our prior experience.
I am going to read to you from the guidance. You asked me
about policy. I brought with me the draft policy that is in
staffing right now, and it specifically addresses concurrency.
I will tell you what it says.
In most programs for hardware-intensive products, there
will be some degree of concurrency between initial production
and the completion of developmental testing, and perhaps some
design and development work, particularly completion of
software, that will be scheduled to occur after the production
decision is made. Concurrency between development and
production can reduce the lead time to field the system, but it
also can increase the risk of design changes and costly
retrofits after production has started.
Program planners and decision authorities should determine
the acceptable or desirable degree of concurrency based on a
range of factors. In general, however, there should be a
reasonable expectation based on developmental testing of full-
scale prototypes that the design is stable and will not be
subject to significant changes following the decision to enter
production. At milestone B, which is our development decision
point, the specific ``typically event-based'' criteria for
initiating production or fielding at milestone C, the
production decision point, will be determined and included in
the decision memorandum that is published at that time.
So we want an event-based decision to enter production
based on actual demonstration through developmental testing,
primarily that the product is mature enough that we can go into
production with reasonable risk. That is the criteria.
Again, I think in the case of the F-35, there was a
combination of factors. Part of it, frankly, was that the money
was sitting there in the budget for production and people had a
sense of momentum about getting production started because the
money was sitting there. I resisted making that kind of
decision in my position. We should not be driven by the fact
that there happens to be some money sitting in the budget.

CONTRACTOR INCENTIVES

Senator Durbin. So let me ask you. One is a theory and
approach to acquisition and the other is the incentive that we
created. And you have just identified it. There was money
sitting there to produce, and there was the yearning urge to
acquire that taxpayers' dollar maybe too quickly, which does
not sound to me like a sound decision, and I think what you
identified is your own personal decision not to fall into that
trap.
I would like to ask you when it comes to something that is
characterized as UCA--I will try to pronounce this--
undefinitized contractual action, a contractor performing work
under a UCA is not incentivized to control cost because all of
the actual cost incurred while under a UCA get rolled into the
final negotiating costs recovered by the Government. That
sounds like a similar situation where we are creating an
incentive to produce, not to produce in a timely fashion or in
the best fashion, but in a fashion that spends the money that
we have appropriated.
What would be your comment on that?
Mr. Kendall. Chairman, I have given other testimony where I
have talked about the pressures in our system, the incentives
to be optimistic, to take risk. And it runs throughout our
whole system. And anyone who has ever held a position like mine
has, to some degree, had to kind of resist those pressures.
If you look at the desire of the operational community to
have the best possible capability--so there is a tendency to
have optimism in terms of the requirements and what we can
accomplish. Industry is interested in selling. So they tend to
be optimistic about what can be produced, what kind of
capability can be built. When budgeteers put together their
budgets, they tend to be optimistic about how much you can get
for the money because they want to get as much as possible into
the budget. When people bid on projects, they tend to be
optimistic because they want to win the business, and the way
to bid a little more aggressively and hope that you can
execute. It ripples all the way through our system. Essentially
one of the things we have to do to keep our risk under control,
frankly, is to kind of push back against that.
Now, you mentioned UCAs. UCAs, undefinitized contract
actions, are essentially situations where we have not
completely defined the job to be done, and we have not reached
a complete agreement with the contractor about exactly what
that job will be and what it will cost us. So we start contract
activities with the idea that after we have started, we will go
back and we will clean it up. We will complete the definition
of the contract. We will definitize, if you will, the contract
action.

UNDEFINITIZED CONTRACTUAL ACTIONS

The data is pretty clear on this. In development in
particular, that leads to problems. It leads to difficulties
further downstream. If you look at the history of our programs
and our cost overruns--and I am going to be publishing some
data on this--UCAs in development consistently result in cost
and schedule overruns later. And it is because, frankly, the
job has not been well enough defined on the Government part,
the contractor is not ready to build it, there is still
openness for optimism that has not been refined yet.
The other problem with the UCA is that you give up a lot of
your negotiation leverage once you sign that contract. And I
resist them. There are rare occasions when we can do them.
Now, interestingly, the data on production contracts that
are started with an undefinitized contract action is not nearly
as negative. The problem is primarily on the development side
of the house. So as a general matter, we resist doing them.
There are rare occasions where we really need to get the work
started. If we are doing something that is an urgent
operational requirement, for example, it makes more sense to
get the work started. People are going to be dying if you do
not get that product out, and you want to get it out quickly
and you take some risk and you may spend some more money as a
result of that. But you get the product out quicker because of
it.
Senator Durbin. Based on your testimony, it sounds like the
enemy is optimism, and I do not know that we want to be
pessimistic when we get into this.
Mr. Kendall. We want to be realistic and pragmatic, Mr.
Chairman.
Senator Durbin. Realistic. Thank you.
Senator Cochran.
Senator Cochran. Mr. Chairman, we appreciate very much
having the cooperation of this distinguished panel of
witnesses. I have a few questions.
General Welsh, the major challenge before us in this year
is trying to avoid budget decisions that compromise our
capabilities that are needed by the U.S. and our allies to look
down the road 10 to 15 years to assess the threats that will
exist then and then making decisions now that help meet those
needs and capabilities.
How do you apply that theory to actual practice? Are we
making progress in meeting the challenge?

ASSESSING FUTURE MILITARY THREATS

General Welsh. Vice Chairman, the biggest problem we have
that Mr. Kendall mentioned is optimism, and I think he is
exactly right, by the way. When you are looking at the military
threat of the future, we also tend to be pessimistic so we
assume the future threat is 10 feet tall, all-capable, all-
knowing, and almost impossible to defeat. And so we need
absolutely the best things money can buy and massive quantities
to be able to fight that war. So we have to fight that tendency
when we look at the future threat.
In the Air Force, we have looked very closely at the future
threat to assess whether it is for conducting the air
superiority mission or it is doing a global strike mission or
it is supporting ground activity, close air support or indirect
strike. As we look at that threat, no matter how you examine
it, when fifth generation aircraft become available to our
adversaries, when advanced SAM systems like the S-300 become
available to our adversaries, when they are able to integrate
and train with those systems, the difference between fourth
generation and fifth generation fighters becomes starkly clear.
And the reality is, without talking about how many you need,
just on a pure capability perspective, if a fourth generation
fighter meets a fifth generation fighter, the fourth generation
fighter may be more efficient, but it will be dead. It really
is that simple.
And so we need to determine when do we need this high-end
capability, how much of it do we need, and then how do we mix
it with a fourth generation capability that we will have in our
fleet for years. We are going to have a mix of aircraft for a
long time, and some missions will be better suited to the
legacy fleet that will have a little bit lower operating cost
and some will be better suited to the high-end fleet that will
have to fight the highly contested, determined foe in a full-
spectrum fight. You have to have the fifth generation
capability to succeed in the air fight. And that is after a
pretty comprehensive analysis of the threat that we intend to
face.
Senator Cochran. Given the expectation of increased F-35
costs and inevitable production delays, is it still true or is
it time to start looking at investment in alternatives, as well
as continued commitment to the F-35 program?

F-35 PRODUCTION COSTS

General Welsh. Sir, I will give you a brief answer and then
see if Mr. Kendall or General Bogdan would like to comment on
the actual production costs. My view is that the Program Office
and the company, the contractors, understand what it takes to
build this airplane now. I believe we have those costs pretty
well captured.
The big costs that we are most focused on now are the
operation and sustainment costs over time. What does it cost to
manage this fleet, to operate this fleet, to repair the fleet,
to supply the fleet? The Program Office is leading a number of
initiatives supported by all the Services represented here who
are working very hard to try and drive those costs down, and I
believe General Bogdan can give you some good examples of early
success in that effort. But this has to be an ongoing,
continuous effort.
One of the benefits we have and kind of a strange side
benefit of the concurrency problem the Chairman described is
that we actually have actual numbers now maybe earlier in the
program than we would otherwise. So we are starting to replace
projected costs with actual costs, and as we continue to fly
more hours, we will have a better feel for what it really costs
to maintain this airplane. But that is clearly the focus.
That will drive us to consider mixed fleets for a long time
into the future. All of us will continue to have them for a
while, and the investment strategies in the future have to
consider options for continuing down that vein.
Senator Cochran. Thank you, Mr. Chairman.
Senator Durbin. Thanks, Senator Cochran.
Senator Reed.
Senator Reed. Well, thank you, Mr. Chairman.
Let me first commend Secretary Kendall for his decisive
intervention in the program, and also for his candor in warning
us that we still have some real serious challenges ahead. We
are not there yet.

REWORK COST

Let me ask a specific question about the rework cost. You
have noted that the cost per unit seems to be coming down. Does
that exclude or include rework cost?
Mr. Kendall. Yes, sir. The cost of production, the basic
production, is coming down roughly with the curve that we
expected it to come down on.
The cost of retrofit, of concurrency changes is also coming
in--about 25 percent I believe--less than our predictions had
indicated. So we are making progress on that as well.
I mentioned that in Lot 5 we started sharing those
concurrency costs with Lockheed. They started absorbing some of
that risk. And we did that for two reasons. One was to focus
their attention on this more and in part to get the concurrency
changes into the design as quickly as possible. And we have
made some pretty substantial progress on that as well. So at
this point in time, we are reasonably encouraged.
Now, of course, as we go through the test program, we are
discovering more and more of the things that have to be fixed,
and we do see that list of things that have to be changed. So
as time goes on, we hope that that will come down and we have
projection that suggests that within the next few years that
will be well under control.
Chris, do you want to add to that?
General Bogdan. Yes, sir. When I talk about the price of
the airplane coming down and I talk about the unit fly-away
cost or the URF of the airplane, it does indeed include the
calculations and the dollars for concurrency, retrofitting
airplanes that came off the production line that were not
corrected, as well as putting those fixes back into the
production line. So our curves and our cost models include an
estimate for that concurrency, sir.
Senator Reed. So you are estimating, going forward, that
the rework trend is down, and given potential issues with
software, you do not anticipate at this point that that curve
will bend back up and you will have another problem.
General Bogdan. Sir, the small good news there is both our
estimates have come down about 25 percent, looking to the
future on how many fixes we are going to have to make to the
airplanes, and the actual cost of making those retrofit fixes
and getting the fixes back into the production line are also
down about 25 percent. So if you take both of those together,
our initial estimates of concurrency cost back 3 or 4 or 5
years ago are probably on the order of about 50 percent lower
now in both the estimating and the actual costs. And I can
provide the committee that information to show you that.
[The information follows:]

The ``Second Report to Congress on F-35 Concurrency Costs: House
Report 112-331, Conference Report to Accompany H.R. 2055,'' dated May
2013, contains the chart below and shows that estimates of concurrency
costs have been reduced approximately 32 percent between the fiscal
year 2012 and the fiscal year 2013 estimate.

The original estimates for concurrency were identified as
approximately 5-8 percent of the overall production costs through
System Development and Demonstration completion. Since that initial
estimate, more precise estimating techniques, along with an overall
reduction in the number of problems driving concurrency changes than
had originally been expected, have put the current cost of concurrency
to 3-5 percent of the overall production costs as indicated by the
chart below.

Senator Reed. Thank you.

FIRM REQUIREMENTS

Secretary Kendall, one final question to you. One way we
manage cost of the weapons systems is changing requirements. Do
you anticipate or is that being discussed in terms of managing
this cost going forward, given limited budgets?
Mr. Kendall. Senator Reed, the requirements--we have 35--I
think are firm at this point. One thing we will have to do is
respond to advances in the threats as they occur. So there is
some follow-on development planned already, and we have asked
for some funds for that to start some of the early design work
to respond to threats that are just emerging. This is not a
world in which things stand still. The threat constantly
evolves, and we have to stay ahead of it.
I want to go back and just mention a couple things on the
possibility of increased cost going forward.
As we go through the test program, we are retiring risk,
but the areas where we would be most concerned are in some kind
of a major structural failure. We have done roughly one
lifetime of fatigue testing on the aircraft. So we have two
more of those to go. As we go through that, the likelihood of a
major structural failure that would cause a significant
redesign goes down, but it is not zero yet.
The same is true of the aerodynamic performance. If there
were some aerodynamic performance major problem that would
emerge as we explore the extremes of the flight envelope, that
might cause a significant problem and some redesign work. So
far, we do not see a high likelihood of either of those things,
but they are still possibilities.

CYBER THREATS

Senator Reed. Let me ask a final question and this goes to
an issue that you are looking ahead to emerging threats. Are
you confident that you have the systems in place to prevent the
cyber aspects of the aircraft from being compromised and
confident that at this point they are not?
Mr. Kendall. I am reasonably confident--and Chris should
answer this as well--that our classified information is well
protected. I am not at all confident that our unclassified
information is as well protected. Now, it is unclassified
because it is not as sensitive or important, but I am concerned
in general with the loss of design information that is at the
unclassified sensitive level, and I am going to be putting some
policies in place to try to make stronger sanctions, if you
will, or stronger consequences for our contractors who do not
protect that information well enough. Part of that is being
stolen right now, and it is a major problem for us.
Senator Reed. And does that increase the vulnerability of
the aircraft right now that we can anticipate?
Mr. Kendall. What it does is reduce the cost and lead time
of our adversaries to doing their own designs. So it gives away
a substantial advantage. So it is not as much a specific
vulnerability. It is the amount of time and effort they are
going to have to put in to getting their next design and
staying with us.
Now, as you are probably well aware, at least two nations
are well into developing fifth generation aircraft right now.
So that is a concern.
Senator Reed. Thank you, Mr. Chairman.
Senator Durbin. Thanks, Senator Reed.
Senator Shelby.
Senator Shelby. Thank you, Mr. Chairman.
I thank all of you for your service.
General Welsh, as I sit up here with this subcommittee, a
part of the Appropriations Committee, a big part, we have to
make sound money decisions. Most of us, I believe, believe air
superiority is very important, as you referenced earlier. We
have had that a long time, since the Second World War.
My thought about the whole plane: One, is the aircraft--is
the concept sound? Will it work? Have you worked out the
technical glitches, most of them? Most planes and most weapons
systems will have technical glitches, some more than others.
And ultimately, this committee has got to balance the need to
how much we can afford.
I believe myself that we should be on the cutting edge of
technology. We should be smart in what we do and how we do it.
I believe, from what I know--and we are not in a closed
hearing, but this plane has got a lot of stuff, potential which
you cannot talk about here today.
But what and how do we bring the cost down? Economies of
scale. We know that. The more you produce of something, we got
to do this. That is going to be one of the money decisions we
have to make. One, do we need this plane? I think we do.
Second, can we afford this plane and how do we afford it?

AFFORDABILITY OF THE F-35

Do you want to talk about that a minute?
General Welsh. Thank you, Senator.
I agree we need the airplane. Can we afford the airplane is
the question facing not just the committee but us as well.
Senator Shelby. The American people.
General Welsh. Yes, sir.
Senator Shelby. Can we afford not to do it?
General Welsh. Well, I do not think so because there is no
other option right now.
What we are asked to do is pretty well defined by our
national guidance and by our Defense Strategic Guidance. And
based on that requirement that is handed to our Services in the
air domain, this airplane is something that we need to meet the
mission we have been assigned. If the mission changed
dramatically, if there was no intent to be worried about
threats from other technology that develops in the future, if
there was not a requirement for the United States of America to
be able to protect its national interest against those threats,
we would not need the airplane. But that is not the case.
And so everything we are focused on right now is making
sure this airplane is operationally feasible. The Program
Office works that every single day. They focus on the cost of
development, the production, and the sustainment over time and
how do we drive those costs down. The Services help them in
that effort.
From the Services' perspective, we are both helping with a
developmental and operational test and we are actually training
air crews now. In the Air Force, we have 22 airplanes. Some of
those are at Eglin Air Force Base, Florida flying right now. Of
those aircraft, we have trained 23 new pilots on the F-35 over
this year. We have flown about 2,200-2,300 sorties and about
3,500 flying hours now. The airplane works. The pilots will
tell you it is a ``great jet'' that the avionics are--here is a
quote from the squadron commander at Eglin--``light years ahead
of legacy fighters in our military.'' And so they believe this
program is moving forward.
They are still frustrated by some of the things that keep
them from fully utilizing the aircraft, but a lot of that is
the function of the concurrency that Mr. Kendall described.
They cannot fly within 25 miles of lightning. They cannot fly
in the weather yet. That is going to require software
development that is due and is on track to be delivered. By the
time we reach our initial operational capability at the end of
2016 for the Air Force, those problems will be in the past.
Senator Shelby. Will this plane, as far as you see, have
any peer in the world?
General Welsh. The F-22 will be a peer, but that will be
the only one.

AFFORDABILITY

Senator Shelby. Secretary Kendall, you have to make
decisions on acquisition, and that gets into the affordability.
Do you want to speak to the affordability again? Economy of
scale--I understand that. And the cost you have brought down. I
understand that.
Mr. Kendall. One of the initiatives that Dr. Carter, when
he was Under Secretary, and I started was to put affordability
caps on all of our programs as they come through the process.
And the idea of that is to ensure that our reach does not
exceed our grasp. And what we require programs to do now is to
do an analysis of likely future budgets that would be expected
and to look at the portfolio of products that the new product
would be in and to determine a reasonable amount of money that
could be spent on the product. And from that, we derive a cost
cap for the production, unit production cost, and for
sustainment costs for the program. Now, obviously, F-35 was
many years into development before we started this policy. We
are doing that now routinely.
As far as the F-35 itself is concerned, it is an affordable
program. It is affordable in part because of its priority. It
is our number one priority conventional warfare program, and we
will find a way to afford it. I mean, 10, 20, 30, 40 years down
the road, there may be a question about how many we actually
end up and how large our force structure is, but I do not think
there is any question at this point in time that we need the
program, that we can afford it within our budget, and that we
need to get production up to a rate that is more economical as
soon as we can.
Senator Shelby. Are you still concerned about any of the
technical glitches dealing with the Services, the Navy, the
Marines, and Air Force?

TECHNICAL ISSUES

Mr. Kendall. As General Bogdan mentioned, there are a
number of technical issues that will be resolved. The tail hook
was mentioned by Admiral Greenert. That will be in testing
shortly in the next few months. The helmet is still being
worked on. At this point in time, I would say the helmet was
kind of on the edge of acceptable. It needs to be better. The
software that was mentioned--we need to get that. Software is
largely a matter of time and money, but some of the 3F
capabilities are very important to the acceptable performance
of this aircraft, and we need to get them even though we can
IOC potentially without them. So there are a number of things
that have to be done. Lightning strike was mentioned as another
one we are working on.
These are all things that we are working our way through in
the development program and resolving over time. We have made a
lot of progress in the last couple of years, and I do not see
anything at this point in time that is going to keep us from
getting the airplane to where we need it to be.
Senator Shelby. Thank you, Mr. Chairman.
Senator Durbin. Thank you, Senator Shelby.
Senator Collins.
Senator Collins. Thank you, Mr. Chairman.
Secretary Kendall, from its inception the F-35 was designed
to be an international program, and indeed, we have formal,
binding agreements with several of our allies such as Great
Britain, Australia. I believe the Israelis have agreed to
purchase some F-35s. Could you comment on what value it brings
to have international partners involved in this program from
the beginning, and also, what cost savings to the American
taxpayers are produced by these international agreements?

INTERNATIONAL PARTNERS

Mr. Kendall. Thank you, Senator Collins.
There are several aspects of having the international
involvement that are beneficial. First is obviously their
direct contribution to the development cost. Our eight original
partners have all made some contribution to development.
There are obviously economies of scale associated with
higher production rates. Right now, we expect several hundred
aircraft to be bought by our partners, and this makes a
difference of--of course, I do not know the exact number, but
it is 10 to 15 percent, I think, in unit cost.
General Bogdan. Almost 20 percent.
Mr. Kendall. Almost 20 percent difference in unit cost.
Now, interestingly, we just had our annual meeting with all
of our partners, all of my counterparts, and reviewed the
program with them. They are all encouraged by the progress on
the program. They are all still in the program, which I think
says something. Canada is still considering its decision, and I
think the Netherlands has not made a final decision. And even
though, because of budget constraints and other things, some of
them have reduced their numbers, they all see the value in the
F-35 and are all, at this point in time, still in the program.
In addition, we are starting some foreign military sales.
So there is something of a consensus that this is the
future of tactical aviation internationally.
Senator Collins. Thank you.
General Welsh, this morning you described the F-35 as a
fifth generation aircraft, and we hear that term all the time
from you and from other military officials and experts. I know
that one of the characteristics that you are referring to is
the aircraft's stealth capabilities.
You share a responsibility to build a force that can
operate effectively in an anti-access environment. We know that
Russia and China are developing advanced stealth fighters. We
know that some of our potential adversaries have advanced
integrated air defense systems as well.
To the extent that you can in open session, could you
describe more fully for this committee what exactly it means
that the F-35 is a fifth generation fighter and how that
technology helps us counter emerging threats?
General Welsh. Thanks, Senator. That is a fantastic
question actually.
I would put it this way. The emerging threat essentially
means it is more integrated, it has longer range, and it
connects quicker to things like sensors and things that can
shoot you down if you are flying in an airplane and prevent you
from completing your mission or getting access to a target.
What the fifth generation capability does with a combination of
the stealth signature that makes it more difficult for radars
or different types to track you, with electronic protection,
self-contained electronic attack capability against those
radars with the ability to move quickly through a threat
environment, with the ability to maneuver to evade enemy
threats that are launched at you. It significantly breaks kill
chains, if that makes sense. So a kill chain, from the time
they first see you and pass off your data on your airplane to a
system that is going to try and intercept you, whether it is an
air system or it is a ground system--that kill chain is
required to be completely intact for someone to keep you from
preventing your mission.
Fifth generation technology allows you to break that kill
chain at multiple places and allows you to operate in an
environment you could not operate in a fourth generation
aircraft because the kill chain would not be disrupted that
way. That is what it does for you whether you are competing
against a single airplane or you are competing against a system
on the ground. It allows us to operate in places we could not
before and complete the mission we have been assigned.
Senator Collins. Thank you. That is very helpful.
Thank you, Mr. Chairman.
Senator Durbin. Thanks, Senator Collins.
Senator Murkowski.
Senator Murkowski. Thank you, Mr. Chairman.
And good morning, gentlemen. Thank you for being here this
morning. Thank you for your service.
General Welsh, as you might expect, my comments or
questions today will deal largely with Eielson and the role
that future OCONUS (outside the continental United States)
basing of the F-35 might play in Eielson's future.
For the benefit of my colleagues here on the subcommittee,
back in February 2012, General Welsh's predecessor announced
that the Air Force planned to transfer an F-16 squadron from
Eielson down to Elmendorf Air Force Base. It would downsize
Eielson by the order of about two-thirds of its Active Duty
personnel and all done by 2015. The Air Force has informed us
that they intend to make a decision this fall following
completion of an environmental impact statement (EIS) and a
strategic analysis.
This would have a devastating impact on the economy of the
Fairbanks and the interior region. The direct and indirect job
loss is estimated at over 3,000 individuals. Unemployment would
rise from where we are now at 6.2 percent to an unacceptable
level of 8.9 percent, lay off teachers, close schools, a tough,
tough situation. Of course, we are not in a base realignment
and closure (BRAC) environment. I have described this as a back
door BRAC.
And it probably comes as no surprise that I, along with the
other members of the Alaska delegation, have requested that the
Air Force be prohibited from implementing its proposal for
Eielson in 2014.
Back in 2008, the Air Force announced to the Fairbanks
community in writing the start of an environmental scoping
process for possible basing of the F-35 there at Eielson, and
then in 2009, we came to learn that the scoping process never
occurred but we were promised at that time that Eielson was
either at or near the top of the list of possible OCONUS basing
of the F-35. So we were then told that there was going to be an
announcement that would be made shortly on OCONUS bases. That
never came.
Can you tell me, General Welsh, what thoughts, if any, the
Air Force has on the desirability of Eielson as an F-35 basing
location, what kind of timeframe you are looking at for OCONUS
F-35 basing, and then also whether or not the Air Force's
immediate decision on downsizing Eielson will be affected by
possible F-35 basing at some point in the future?

OCONUS F-35 BASING

General Welsh. Yes, Senator. The Secretary and I just
reviewed earlier this week the proposed criteria for our
overseas CONUS base selection process for the F-35. There is a
little more work to be done on that to make sure we have the
criteria firmly established and clearly coordinated with U.S.
Pacific Command, U.S. European Command, and Pacific Air Forces
(PACAF) and United States Air Force in Europe (USAFE). That
process is ongoing. I would suspect by the end of this month
those criteria will be firmly established and we will start to
evaluate all of the potential bases in both Europe and the
Pacific.
In the Pacific, Eielson is one of the bases. As you know,
Alaska--it will be part of the Pacific basing for overseas
basing for the Pacific. Eielson is one of the bases on the list
to be examined. And so we will take a look at every base
relative to these criteria and sometime this fall--my guess is
late October--we will produce a preferred and a reasonable
alternative listing that will be fully briefed to the Congress.
I will tell you this, Senator. I am looking forward to my
visit to Eielson here in about a month or month and a half to
meet with the community there and hear their concerns directly.
And as you mentioned, we are completing the environmental
impact statement and we are still on the same timeline to make
a recommendation to the Secretary this fall.
Senator Murkowski. Let me ask then about the EIS. Some of
the particular criticism that I have heard, which you should be
prepared for when you go up north--I understand that the Air
Force is simultaneously proceeding to complete the EIS and the
strategic analysis. The public will have an opportunity,
apparently, to comment on the EIS draft but not on the
strategic analysis. And I am not quite sure why it is set up
that way. It does not seem to make sense to me. An EIS is
designed to inform the decisionmakers on the range of
alternatives to a proposed action. So it seems logical to me
that you would have the strategic analysis precede the EIS and
then inform from there.
So I guess the question to you would be whether or not you
could leave this draft EIS comment period open until the
strategic analysis is done and also to invite comments then on
the strategic analysis as well, whether or not you would
consider that.
General Welsh. Senator, the path ahead that the Secretary
laid out for us was for us to take a look at the EIS. The
strategic analysis I believe you are referring to is the one
that will be conducted by the Pacific Air Force's Commander,
General Carlisle and his team. And when he has completed that
analysis--and it is an operational analysis. It is an
assessment of the inputs from the EIS. It is to look at
costing. It is to look at all the things you and I both hope
are in the discussion. And then he will come forward to the
Secretary with a recommendation. I am not sure keeping that
available for public comment, as he completes his
recommendation, would be helpful to his process. I think public
comment has been pretty clear in the EIS, and that is going to
be factored in to everything he says. You, of course, will see
the results of any analysis he does.
Senator Murkowski. And I just might add that the concerns
that I am hearing from those who weighed in and gave that
public comment is that they do not feel that they have been
heard on it. So it will be something that you will hear when
you go up north. So it may be something that you and your folks
might want to give an extra look at, and I would appreciate
that. I look forward to your visit.
Thank you, Mr. Chairman.
Senator Durbin. Thank you, Senator Murkowski.

LARGE ACQUISITION PROGRAMS

Let me ask you this, Mr. Kendall. I have listened to your
earlier testimony, and I am trying to draw some analogies which
may or may not be accurate in my mind. In the financial
industry, we have this phrase ``too big to fail.'' And I am
wondering if this project is so large in scope that it was too
big to cancel, that it had to continue apace because of
international partners, fifth generation demands. Have we
reached a point, when it comes to acquisitions in the future,
that we have to take this into consideration?
Mr. Kendall. Mr. Chairman, I do not think any program in
the Department is too big to fail just as a matter of
principle.
As a practical matter for the F-35, we are not at a place
where we would consider stopping the program. I think General
Welsh mentioned that. We are most of the way through
development. The costs, I think, are under control, at least
for production. We are trying to bring the costs of sustainment
down. There is no question that the threat is driving us
towards the next generation of aircraft. Our fourth generation
aircraft are not going to be survivable on the future
battlefields. To start over, to go back 10-20 years and to
invest $20 billion or $30 billion in development of another
aircraft and replacement of the F-35 just does not make any
sense.

SUSTAINMENT

Senator Durbin. So let me go to the one particular that you
mentioned: Sustainment. It is my understanding that the cost of
flying the Air Force variant of the F-35 is 28 percent greater
than sustaining the F-16. And a report that came out in 2012,
the JSF Selected Acquisition Report, estimates the cost to
sustain the fleet of JSF's over a 30-year life is $1.1
trillion, which equates over a 30-year period of time to $36
billion a year, which is a substantial sum of money by our
calculations, by anyone's calculations.
It is my understanding that one of the best ways to reduce
sustainment costs is to address them very early in the program,
and it appears that did not happen as it should have in this
program. So what actions are we taking now to deal with these
anticipated sustainment costs?
Mr. Kendall. Chairman, I would just point out to you that
is, I believe, an inflated number over about 50 years. So it
covers a lot of time and a lot of inflated costs. It is still a
very big number and we need to do everything we can to drive it
down. There is a long list of things. I think in our written
testimony we go through some of those.
But the keys include looking very creatively at the things
we do in sustainment to see if there are more efficient ways to
do them and also bringing in competition. We are not going to
leave this sole source in the hands of one provider. We are
going to go out and bring in competition and use that to drive
the costs down.
We also have an initiative in the Department to use what is
called performance-based logistics. It is a business approach
where people essentially provide a level of reliability to us
and get incentives to do that and provide it to us at lower and
lower cost.
So there are a number of things that can be done. I am
going to let General Bogdan answer. He has got a long list of
things that we are doing.
Admiral Venlet, who was General Bogdan's predecessor, has
also attacked this problem. So we are not just starting on
this. You can, I think, argue that we started this too late. We
should have done it a little bit earlier, but we are certainly
giving it our full attention now.
Senator Durbin. General Bogdan.
General Bogdan. Sir, there are primarily three areas that I
am taking action on right now to try and reduce the costs.
The first area, as Mr. Kendall said, was there are
different portions of the sustainment lifecycle of the airplane
that we, over the next few years, will compete. For example,
support equipment on this program is well known. We know where
the support equipment needs to come from. We know what it is
designed like. There is no reason in the world why I need to
buy the support equipment for this airplane from a single
supplier who actually just goes out and contracts with many
other suppliers to buy that. So we will compete that type of
thing.
Another example is on the global supply chain. We will have
airplanes all over the world in the next 10 or 15 years. There
is no reason to believe that a prime contractor whose niche is
building and manufacturing airplanes could be or should be a
world-class global supply chain expert. There are other
companies out there that can do that, and we will explore those
kinds of options. So competition is one piece.
There is a second piece that we are working on very
aggressively. That is what we call our reliability and
maintainability program. Until a few years ago, this was an
airplane on paper. We did not have airplanes flying. Today we
have over 7,000 hours under our belt and over 5,000 sorties.
The information that I am gaining from flying those airplanes
today is invaluable. I can show you a list of the 50 top parts
on the airplane that are breaking more readily than we thought
they would. I can show you the 50 parts on the airplane that
are taking longer to repair than they should. By systematically
looking at a reliability and maintainability program where we
attack those problems by either redesigning the parts or
finding a second supplier or finding a way to better repair
those parts organically, say, by standing up your depots, you
can begin to attack the reliability and maintainability of the
program. We could not do that a number of years ago because we
did not have any real data. We have a lot of that data now. So
we are doing that.
The third piece is that $1.1 trillion estimate that you
talked about has an awful lot of assumptions in it that those
three gentlemen at the other end of the table have a lot to do
with in terms of how many hours does each pilot need to fly
relative to getting training in a simulator. How many
maintainers do I really need on the flight line to launch this
airplane?
Those kinds of assumptions, which we put in place many,
many years ago, that came up with this $1.1 trillion number are
now being relooked at because we know more about the airplane.
And with their advice and with their assumptions, we will go
back in and now relook at the CONOPS, or the concept of
operations, for maintaining and sustaining the airplane and
adjust those numbers. I personally think you will see over the
next few years those numbers coming down, sir.
Senator Durbin. Thank you very much.
Senator Cochran, any follow-up?
Senator Cochran. Mr. Chairman, I have one follow-up
question.

F-35 OPERATIONS AND MAINTENANCE COSTS

General Paxton, the Commandant of the Marine Corps, General
Amos, has indicated the Marines expect to save up to $1 billion
per year in operations and maintenance cost by having one type
of tactical aircraft in inventory, and that billions of dollars
have already been saved over the last decade by not
recapitalizing the Marine Corps with fourth generation aircraft
and waiting to recapitalize with the F-35.
Given increased F-35 costs and production delays, is this
still true, or is it time to start looking at alternatives, as
well as continued commitment to the F-35 program?
General Paxton. Thank you, Senator Cochran.
I believe the basic premise of the Commandant's previous
statement and then when you connect it to the comments that
General Bogdan and Mr. Kendall just made--the basic premise of
cost and affordability is true. It is coming down, and as we
actually have more flight hours and more sorties and more
reliability of the data, we have a better ability to predict
the actual fly-away costs, as well as the cost per flight hour
for the aircraft.
I come at this a little differently as opposed to the
gentlemen at the other end of the table who are either
technicians or aviators. I am a grunt. I am an infantry guy. So
when I look at the program and the viability and the value of
the program, sir, I go back to the basic premise that we have
three type model series that we are going to do away with, the
F/A-18, the EA-6B, and the AV-8B. So there is an inherent cost
savings in necking down the type model series.
In addition, as we get more reliability, as General Bogdan
said, and we get actual facts from those hours and sorties, we
have the capability of collapsing a little bit the maintenance
that is done at the depot level, at the intermediate level, and
at the organizational level. We actually have marines out there
right now turning wrenches on things that we did not expect to
happen this early in the program because we have been able to
identify where some of those mean times between failure are and
what they can actually do.
So I believe as the program gets more mature, a comment
that General Welsh made earlier about the value of stability in
the program--it is not an issue of too big to fail, sir. It is
an issue of stability and using stability to create an
advantage and turn risk into opportunity because I am confident
we can bring the costs down on this. And then the bathtub that
we are in where we have aging fourth generation legacy
aircraft--we will be out of there, and then we will be into a
fifth generation aircraft that we can optimize and use around
the world in many more places to do many more things.
Thank you, Senator.
Senator Cochran. Thank you very much.
Senator Durbin. Senator Shelby.

TECHNICAL CHALLENGES

Senator Shelby. I want to go back, if I could, Secretary
Kendall, to the technical challenges because General Bogdan
alluded to some of them just a minute ago.
What are, say, the top three technical challenges? Is it
software, as it develops and will help you expand your envelope
and so forth? Is it metal fatigue or problems with metal
production, you know, the failure of that? What is it? I am
sure all of them have not been satisfied, but I feel
technically they will.
Mr. Kendall. I will give you my three and General Bogdan
may have----
Senator Shelby. Is that important----
Mr. Kendall. It is. We have a list of things, obviously,
that we are attacking.
The top three on my list would, first of all, be software
and getting the software completed. The Block 3F capability is
critical to the airplane. So we need to get that done. We will
have to make some decisions as we get further along. We are
about to do a critical design review for that software, and we
will be looking at it very closely this fall.
The second thing on my list is the helmet. The cockpit of
the airplane was designed around the concept of that helmet and
the ability of the pilot to look through the structure of the
airplane and to have all the things he needs in front of him in
the visor of that helmet to operate effectively. There are a
number of issues there that we have been working. As I
mentioned earlier, we are kind of at the edge of acceptable,
but we are not where we would like to be to get out of that. So
that would be second.
The third thing is the thing that came up a moment ago. It
is reliability. We are not where we need to be on reliability
right now. And I think we can do better on that. We are lagging
behind our own goals by a significant margin right now in terms
of the reliability that we are actually seeing on the airplane.
We need to improve that.
So those would be my top three, and I will let Chris add
anything.
Senator Shelby. General.
General Bogdan. Sir, I would tell you software, software,
software.
But realistically Mr. Kendall got it right. Software is
number one on the list, and he talked about that.
Senator Shelby. But the software, if I could--and correct
me if I am wrong--expanding software, you know, software that
people are thinking up and putting together, that would help
you expand the envelope of the capability of this plane, would
it not?
General Bogdan. Absolutely, sir.
Senator Shelby. It is key. Go ahead.
General Bogdan. First of all, just to give you some
perspective, the airplane itself has 10 million lines of
software code in it. That is about five times more than any
other airplane we have ever developed. And that is just on the
airplane. The off-board systems, the maintenance system, the
mission planning system, has another 10 million lines of code
on it. So this is virtually a flying computer.
If you do not get the software right on this program, all
of those things that General Welsh and the CNO and the Vice
Commandant of the Marine Corps talked about are not going to
work right. We have many sensors on the airplane and they all
have to talk to each other to provide the pilot with the
situational awareness he needs to go into those very high-
threat environments. If you do not get the software talking
right to those sensors, you will have a problem.
The good news there is over the last 2 years, we have made
significant progress in the way we develop, test, and field
software on this program. I am cautiously optimistic that in
the future what we have learned over the last 2 years can be
applied to the future, but that does not mean that we are out
of the woods yet because the hardest part of the software
development on this program still lies ahead of us in our Block
3, and that is where we attempt to take all the information
from one's own airplane from another F-35 flying next to you
and all the other sensors that we have in our arsenal and put
that all together to give that pilot a picture.
Senator Shelby. Do you believe you can do it?
General Bogdan. I do, sir. And the reason why I believe
that is--and I am cautiously optimistic--is because a lot of
the foundation of what we need to do in 2016 and 2017 we are
flight testing today. And it is working. It is not working
perfectly, but there are no things that I look at in the future
relative to software that I do not think we can overcome to be
quite honest with you.
A couple years ago, I am not sure we could have said that
on the program partly because we had not flight tested much of
it. But we have 40 percent of the flight testing done now, and
we are starting to learn a lot more.
One of the other things that Mr. Kendall did not mention
that is always on my mind is the maintenance system on this
airplane is a huge information technology system. We call it
Acquisition Logistics Information System (ALIS). And what it
does is it combines both the maintenance of the airplane, the
supply chain for parts on the airplane, and the training for
the maintainers and the pilots, and puts it all together. That
system has great promise, but that system like any other
complicated information system with software has got serious
problems.
What we did over the last year, instead of keeping that
logistics/maintenance system in that part of the development
program organizationally, we pulled it back underneath our
engineering team. So they are dedicating the same kind of
software work that we use on the airplane to the maintenance
system. I believe over the next 2 years--and you can hold me
accountable for this--we will see great improvement in the ALIS
system.
Senator Shelby. General Welsh, do you have anything to add
to that?
General Welsh. Senator, I am pretty confident because while
it is not the same thing and it is not nearly as complex as
doing it on the actual airplane, we have integrated this
concept in the simulator, which has been working well for
training for some time. Now, there are not as many lines of
software code in the simulator, but the data integration
concept works tremendously well. One pilot described it to me
as if you are flying around in a 200-mile bubble of
information. That is the concept behind the airplane. That is
why the helmet is so important because that is how it is
relayed to the pilot. Everything as a young fighter pilot, I
grew up flying around thinking, ``Boy, I sure wish I knew X; X
is now available to somebody flying the F-35.'' It is displayed
for you in a very easy-to-understand concept. The biggest
problem for the pilots is figuring out how do you manage the
info. That is what they are focusing their training on.
Senator Shelby. Thank you, Mr. Chairman.
Senator Durbin. Thanks, Senator Shelby. It was a good
question and it, I think, puts in perspective what we are
talking about here. Who could have imagined 12 years ago, when
somebody said let us do a Joint Strike Fighter, what the
evolving threat would be that we face today and will face in
the future and what the evolving technology would be? We could
not have dreamed we would be carrying these around in our
pocket. Maybe they could have but I would not have. And we are
dealing with that.
And it takes a sense of optimism, Mr. Secretary. I do not
think that is a negative in every aspect. I think it is
positive when it comes to our view as Americans facing
challenges, meeting them head on, and conquering them. And
despite some setbacks here, we are on the path now to the
development of a plane that is going to make America safer.
Thank you for your testimony today. We are going to have
the second panel come on now, and I will come by and say
goodbye to you and thank you for your testimony.
Director of Operational Test and Evaluation, Michael
Gilmore; from the GAO, Michael Sullivan; and from Brookings,
Michael O'Hanlon will be the next panel.
We are going to welcome the second panel here once we get
nametags switched. There we go.
Our first witness on the second panel is Director,
Operational Test and Evaluation, the Honorable Michael Gilmore.
Dr. Gilmore, please proceed. Your written statement will be
part of the record and please proceed with your oral testimony.
STATEMENT OF HON. DR. J. MICHAEL GILMORE, DIRECTOR,
OPERATIONAL TEST AND EVALUATION
Dr. Gilmore. All right. Thank you, Mr. Chairman, Senator
Cochran, Senator Shelby.
I agree with the statements that were made by a number of
the previous panel members that the program now is on a much
sounder basis than it was back in 2009 preceding the Nunn-
McCurdy review and the restructuring and the technical baseline
review that actually extended--all those activities extended
into 2011. They put the program on a much firmer basis by
taking a hard-nosed look, a rigorous look at past program
performance. And I am not talking about ancient programs; I am
talking about programs like the F-22--what it took to make
those planes operational; what were realistic assumptions about
what kind of testing actually needed to be done; and what kind
of, they are called, test points needed to be flown; what could
modeling and simulation really tell you versus what you needed
to have the aircraft itself tell you; how many aircraft did you
actually need to do testing.
So we added a significant number of aircraft to conduct the
test program. We added a substantial number of test points, not
relying on modeling and simulation or unrealistic assumptions
about so-called test efficiencies, which the Program Office,
unfortunately, is beginning to talk about again.
And I also agree with the statements that were made by
Lieutenant General Bogdan and Mr. Kendall that there are many
important challenges that remain. In particular, the Block 3F
software, which is going to provide the most important combat
capabilities, has yet to be flight tested. An earlier version
of it is just beginning development.
What is the history of flight testing that software up to
this point? Well, as I looked at the most recent data from the
Program Office in preparation for this hearing, as of the end
of May of this year, not all of the Block 1 test points had
been completed. They were supposed to have been completed some
time ago.
The Block 2A software flight test program was supposed to
complete in February 2013 according to the integrated master
schedule's version 7 that the Program Office is funded to. That
did not occur. That flight testing did not finish at the end of
February. And my estimate is that it could extend anywhere from
January 2014 to August 2014.
Block 2B in integrated master schedule 7, was supposed to
finish flight testing in May 2014. My current estimate, based
on the pressures that I see building in the program, is that it
will finish around December 2014.
Now, admittedly, these are not the multiple-year
disconnects with reality that existed prior to 2009. These are
6 to 12 months in schedule slippage relative to the integrated
master schedule to which the program is funded. So that is
obviously an improvement. But it does demonstrate that as many
of the previous panel members said, this is an extremely
complex undertaking, and it is very difficult to project with
any certainty, although we are doing a much better job of it
than we had been, how long it will take to finish all of these
complex developments and demonstrate through testing that they
actually work.
Some of the previous panel members talked about 90 percent
of the development being complete. Well, that depends upon how
you define development. To me, the development is not complete
until the military capabilities have actually been demonstrated
through testing to work. Many of the panel members talked about
development of the software being complete when it is actually
available for the first time to be loaded into the aircraft.
And what we are finding is that we discover a number of
problems, many problems that require what is called regression
testing and other testing to sort through and fix once we
actually start the flight test program.
I would note that the PEO, Lieutenant General Bogdan, noted
that the Block 2B software program is just a few weeks out of
step with his current schedule. And that is true, but his
current schedule is based upon a rebaselining that the program
did back in November 2012 that added 31 weeks to the
development program for the Block 2B software and subtracted 31
weeks from the flight test program. Now, that is a concern to
me because what that means is the flight test program is
undergoing an accordion like squeeze, and I am afraid that it
may mean that some unrealistic assumptions are being made about
flight test efficiencies.
And so I hope that that decision to increase the 31 weeks
needed for development of the software, which was prudent based
on what we have been seeing, but to then subtract 31 weeks from
the flight test program so that the endpoint, the fleet release
of the 2B software, stays there in 2015 consistent with needs
for operational testing and IOC in the Marine Corps--I hope
that is not a harbinger of decisions that were made early in
the last decade which yielded the need for the restructuring.
Finally, you mentioned a concern about how do we reduce
risk, what lessons should we learn. Mr. Kendall mentioned that
we needed much more rigorous developmental testing and that we
should wait longer before we begin production. I mean,
production in this program started before there was any flight
testing at all, which was unprecedented in the history of
aircraft development programs. And so that is about as
concurrent as you can get. That is pretty much 100 percent
concurrency. Obviously, that is a bad thing.

PREPARED STATEMENT

We need to have more rigorous developmental testing. We
need to let that developmental testing proceed before we make
production decisions. But let me also say that my experience
with early operational assessments where we take versions of
aircraft, tanks, other military equipment before a production
decision is made, before a decision to go to low-rate initial
production, put it in the hands of soldiers, sailors, airmen,
and marines, let them tell us what the problems are that they
see at that point, even though when we start low-rate initial
production, we still have a ways to go in terms of developing
all of the final capabilities, let the actual people who are
going to have to use this equipment and rely on it tell us what
the problems are that need to be urgently fixed before we ramp
up to full-rate production.
Under law, we do the initial operational test just prior to
full-rate production, but I see great value to doing these
operational assessments prior to a decision to begin that low-
rate initial production.
So I thank you and I look forward to your questions.
[The statement follows:]

Prepared Statement of Hon. Dr. J. Michael Gilmore

PROGRESS IN TESTING

Mr. Chairman, Senator Cochran, members of the committee, my
testimony reviews the progress made in flight and ground testing over
the past year and provides an update to my fiscal year 2012 annual
report on the Joint Strike Fighter (JSF) program. Testing has been
productive in allowing expansion of the aircraft's flight envelope (the
conditions under which aircraft are permitted to fly) in flight
sciences and in demonstration of the limited mission systems
capabilities provided by early software versions. However, problems
revealed by ongoing testing, particularly of mission systems, have
required additional time and effort to resolve relative to the
program's plans, and the most challenging portions of the flight
envelope and mission systems capabilities are yet to be tested.
Consequently, if no relief is provided to current limits on the cost
and schedule for completing System Design and Development (SDD), it is
possible all the military capability now associated with the Block 3F
versions of JSF will not be provided for operational testing in 2018.
Nonetheless, since the conclusion of the 2011 re-planning of JSF
testing that yielded Integrated Master Schedule 7, which in turn
followed the 2010 technical baseline review, flight testing has been
planned and executed using a much more realistic set of assumptions for
achieving progress than had been used previously. Overall, through the
past year, the rate of flight test sorties has met or slightly exceeded
the plan and the volume of test points attempted nearly conforms to
that planned. The resources added in test aircraft, staffing,
instrumentation, and support equipment have made this possible.
However, there have also been challenges that have required the program
to add testing, such as to diagnose discoveries that have occurred in
all types of flight test, regression testing (to verify corrections to
problems did not create additional problems) of new mission systems and
vehicle systems software, and investigations into unexpected
shortcomings like that performed on the helmet mounted display system.
None of the analyses conducted to date, by the Program Office or
discussed in this testimony, have accounted for the effects of
sequestration. Reduced funding for test resources and infrastructure
while the F-35 is in development--such as reductions or elimination of
funding for the McKinley lab, the test chambers, and support aircraft--
will only add to the pressure to either extend SDD or accept reductions
in capability. Additionally, reductions in developmental testing, which
I understand are being considered by the Program Office, without the
appropriate matching reductions in capability, will not remedy this
situation. This approach would likely result in significant discoveries
in operational testing and cause the program to extend until the
discoveries are diagnosed and remedied.

FLIGHT SCIENCES PROGRESS

Flight sciences testing in all three variants has focused on what
is needed to provide the flight envelope expected for release of Block
2B capability to the Services in 2015, which will provide a limited
subset of the combat capability planned for Block 3F. Testing has been
underway to achieve air refueling capability, increase combat
maneuverability by evaluating performance in high angle-of-attack
regimes, perform weapons integration tests, and prepare for shipboard
operations/suitability testing for the F-35B and F-35C.
The test centers were affected by two stop orders earlier this
year. The F-35B fleet was grounded after the first British production
aircraft, BK-1, experienced a fueldraulic line failure in the Short
Take-off Vertical Landing (STOVL)-unique swivel nozzle at Eglin Air
Force Base (AFB) on January 16, 2013. The cause was determined to be a
poor manufacturing process used for the hoses, leading to crimping
dimensions being out of specification; the stop order was lifted nearly
4 weeks later on February 11, 2013, allowing all F-35B flights to
resume. The entire F-35 fleet was grounded on February 21, 2013, after
a crack was discovered on February 19, 2013, in one of the third stage
low-pressure turbine blades in the engine of AF-2, a flight sciences
test aircraft at Edwards. The cause of the crack was determined to be a
rupture due to thermal creep, a condition where deformation of material
forms from the accumulated exposure to elevated temperatures at high
stress conditions. The stop order was lifted 1 week later, on February
28, 2013, with the requirement for additional inspections of the
engines to ensure the effects of creep, if they occur, are within
tolerances. Discovery of excessive wear on the rudder hinge attachments
on AF-2 in early March 2013 also affected availability of test
aircraft. As a result, the test fleet was grounded for inspections and
maintenance actions, including replacing part of the hinge on AF-2 and
adding wear-preventing washers to the hinges of the rest of the test
fleet. In total, AF-2 was down for 6 weeks for replacement of the
engine and rudder hinge repair. BF-2 experienced a polyalphaolefin
(PAO) coolant leak in February, grounding the aircraft for 77 days.
Inflight refueling for the F-35A test fleet was expanded in January to
allow nontest wing based tankers to support test flight operations,
allowing for more efficient use of the test aircraft at Edwards.
F-35A Flight Sciences.--Testing on the F-35A has included envelope
expansion for weapons, continued examination of flutter and loads, and
some high angle-of-attack testing. During early high angle-of-attack
testing, problems with the air data computer algorithms were
discovered, requiring an adjustment to the control laws in the air
vehicle software. The updated control laws, once installed, permitted
portions of the high angle-of-attack testing to continue; however, some
portions of the testing will need to wait for the next update of
software expected to be delivered to flight test in October. The result
has been a delay in opening up high angle-of-attack portions of the
envelope, which are required to realize the full capabilities,
including flight envelope and weapons delivery, planned for Block 2B.
As of the end of April, progress in test points required for 2B
envelope fleet release is behind the plan for the year, having
completed 473 of 614 points planned for completion through the end of
April 2013, or 77 percent. Progress in weapons integration is also
behind schedule, having completed only 7 of 19 total separation events
versus the plan to have completed 14 events by the end of April.
Accounting for test activity prior to calendar year 2013, the program
has completed approximately three-fourths of the total number of test
points needed to clear the Block 2B flight envelope for the F-35A.
F-35B Flight Sciences.--Testing this year has focused on STOVL mode
operations, in preparation for the second set of ship trials planned
for August onboard the USS Wasp, Block 2B envelope expansion, air
refueling, and weapons separations. High angle-of-attack testing has
not started in the F-35B. Progress on test points for Block 2B envelope
in 2013 is behind the plan through the end of April, as the test center
has completed 152 of 371 planned points, or 41 percent. Only 6 of the
24 total weapons separations for Block 2B had been completed, with 10
planned to be completed by the end of April. Accounting for prior test
activity, the program has completed approximately two-thirds of the
total number of test points needed to clear the 2B flight envelope for
the F-35B.
F-35C Flight Sciences.--Test point progress has proceeded as
planned so far this year for Block 2B envelope expansion in the F-35C;
however, no weapons separations or high angle-of-attack testing has
been completed. The first set of sea trials are scheduled to start in
the summer of 2014 (June 30), with two test aircraft from the flight
test center. The first of these two aircraft is scheduled to be
modified with the updated arresting hook system and upgraded nose
landing gear brace later this year, which will permit catapult and
arresting hook testing to begin again. The second aircraft is scheduled
to be modified in the spring of 2014. Testing for electromagnetic
environmental effects will need to be completed on both aircraft prior
to the ship trials as well.
Progress on test points for the Block 2B envelope is slightly
behind the plan through the end of April, as the test center has
completed 574 of 599 planned points, or 96 percent. Accounting for
prior test activity, the program has completed approximately 70 percent
of the total number of test points needed to clear the Block 2B flight
envelope for the F-35C.
Buffet and transonic roll off (TRO) (when lift is unexpectedly lost
on a portion of one wing) continue to be a concern to achieving
operational combat capability for all variants. Control laws have been
changed to reduce buffet and TRO, with some success; however, both
problems persist in regions of the flight envelope, and are most severe
in the C model. The program plans to assess the effects of buffet and
TRO by collecting data while flying operationally representative flight
profiles later this year, after the next version of air vehicle
software is released to flight test. No further changes to the control
laws are being considered, as further changes will adversely affect
combat maneuverability or unacceptably increase accelerative loading on
the aircraft's structure.

MISSION SYSTEMS PROGRESS

Although mission systems testing has been able to keep pace with
the program plans for generating sorties and accomplishing the test
points, the program is falling behind in achieving progress in
delivering capability. This lack of progress is caused in part by the
need to add unplanned testing to evaluate problems, such as the 221
added points for dedicated testing of the helmet mounted display
system, as well as for regression testing of new software loads
delivered to flight test, where 366 test points have been added already
in calendar year 2013 to evaluate four new software releases. The test
centers began flight testing Block 2A software in March 2012, and, as
of the end of May 2013--15 months of flight testing later--had
completed about only 35 percent of the 2A test points, all of which
should have been completed by the end of February 2013, according to
the integrated master schedule. The first build of Block 2B software
was delivered to flight test in February 2013, and, as of the end of
May 2013, 54 of 2,974 Block 2B baseline test points--less than 2
percent--had been completed. As of the end of April 2013, 303 of 1,333
total planned baseline mission systems test points for the year with
all versions of software had been accomplished. An additional 532 added
(or ``growth'') points were flown to evaluate discoveries and for
regression testing, which is 2.5 times the growth allotted in flight
test plans through the end of April 2013. If this trend in added
testing is maintained throughout Block 2B development, completing
flight test by October 2014, as reflected in the program's current
plans, will not be possible.
Additionally, mission systems software development and delivery to
flight test have lagged behind the plan reflected in the program's
integrated master schedule. The final Block 2B software configuration
is now forecast to be delivered to flight test 8 months later than
expected by the current integrated master schedule--a delay from August
2013 to April 2014. The delay adds to the challenge of completing 2B
flight test by October 2014, which is necessary to support an
operational evaluation of Block 2B capability planned now to be
conducted in calendar year 2015. Block 2B as now planned will provide
limited capability to conduct combat. If Block 2B F-35 forces are used
in combat, they would likely need significant support from other
fourth-generation and fifth-generation combat systems to counter
modern, existing threats, unless air superiority is somehow otherwise
assured and the threat is cooperative. Reductions to this limited Block
2B capability, particularly if they are taken in the remaining, harder-
to-achieve capabilities that are yet to be tested, could be difficult
for operators to accept if they expect to use Block 2B aircraft in
combat against a capable adversary.
Two of the additional aircraft expected by the program plan to
support mission systems flight test, which were borrowed from
operational test squadrons, were delivered to the test team in April
2013. The mission systems flight test teams are accomplishing testing
in the final Block 2A and early Block 2B configurations, which are
comparable in providing more combat-relevant functionality than Block
1, such as limited simulated weapons delivery, datalink, track fusion,
and electronic warfare capability. Aircraft start-up problems continue
during pre-flight operations. Flight test teams have also experienced
several problems in flight such as lost data link messages, split
target tracks, incorrectly fused tracks, and difficulty maintaining
targets/scenes using the electro-optical tracking system. The program
began a focused effort this year to determine the cause of position
errors due to drift in the ownship kinematic model, which provides
critical flight parameters and spatial situation awareness to the
pilot. Errors from drift in vertical velocity must be resolved before
certification for night or instrument meteorological flight is
possible. In the coming weeks, testing of fixes and the capability to
warn pilots drift is occurring will begin.
The program has also dedicated 42 flights to investigating
deficiencies in the helmet mounted display system. Seven aircraft from
all three variants flew test missions from October 2012 through May
2013 to investigate jitter in the helmet mounted display system, night
vision camera acuity, latency in the Distributed Aperture System
projection, and light leakage onto the helmet display under low-light
conditions. Although some progress has been achieved, results of these
tests have been mixed according to comments from the test pilots.
Testing could not be completed within the full operational flight
envelope evaluating mission-related tasks, as the full combat flight
envelope has not been released. Filters for reducing the effects of
jitter have been helpful, but have introduced instability, or
``swimming,'' of the projected symbology. Night vision acuity was
assessed as not acceptable with the current night vision camera, but
may be improved with the ISIE-11 camera under consideration by the
program. Latency with the Distributed Aperture System projection has
improved from earlier versions of software, but has not yet been tested
in operationally representative scenarios. Light leakage onto the
helmet display may be addressed with fine-tuning adjustments of the
symbology brightness--a process pilots will have to accomplish as
ambient and background levels of light change. Although not an
objective of the dedicated testing, alignment and ``double vision''
problems have also been identified by pilots and were noted in my
report earlier this year on the F-35A Ready for Training Operational
Utility Evaluation (OUE). Whether the progress achieved in resolving
the problems discussed immediately above has been adequate will likely
not be known with confidence until the Block 2B operational evaluation
is conducted in 2015.
Later this year, the program plans to begin testing mission systems
Block 3i, which includes significant hardware changes to the aircraft's
integrated core processor, electronic warfare processor,
communications-navigation-identification processor, and the
multifunction array (radar). Block 3i software is needed for Lot 6 (and
beyond) production aircraft equipped with this new hardware to be able
to fly. Initially, Block 3i capability will be more limited than the
Block 2B capability that will be concurrently fielded. This is because
the timeline to develop, test, and clear Block 3i for use in production
aircraft next year requires that Block 3i start with an early Block 2B
version in lab tests very soon this year; thus, the capability provided
in Block3i will lag Block 2B by about 6 months. Maturing Block 3i
hardware and software will be a significant challenge in the next 12 to
18 months. Simultaneously, the program will need to make progress on
Block 3F development. The ability of the program to successfully
execute this concurrent software development is the most significant
source of uncertainty regarding what combat capability the JSF will
actually provide in 2018.

WEAPONS INTEGRATION

Weapons integration progress has been very slow since it began last
year. Safe separation testing for the laser-guided bomb, GBU-12, has
been delayed until a new lanyard and lanyard routing procedure are
available. Deficiencies, some of them recently discovered, in the
electro-optical tracking system's ability to maintain a track have also
hampered progress in laser-guided bomb employment testing. As a result,
the first end-to-end GBU-12 weapons delivery test is not likely before
October 2013. Integration of the AIM-120 medium-range missile has
experienced problems that have been difficult to replicate in lab and
ground testing. A safe separation event in which an AIM-120 missile was
launched from a flight sciences aircraft occurred on June 5, 2013; this
event was testing the ability to safely release the missile and ignite
the rocket motor from the weapons bay--there was no target or sensor
fusion providing track/guidance data. The first end-to-end weapons
delivery test using AIM-120 missiles is not likely to occur before
November 2013, and meeting this date depends upon implementing
essential corrections to deficiencies in the mission systems software
and completion of remaining safe separation testing. Testing with the
Joint Direct Attack Munition (JDAM) found that the aircraft was not
able to transfer position and velocity data accurately to the weapon, a
procedure required to spatially align the weapon with the target and to
determine launch parameters and support release. A fix to this
alignment problem has been developed and recently tested, showing some
improvement. However, additional fixes and testing are required to
ensure the alignment problem is fully resolved and to permit JDAM
weapons testing to proceed. The first end-to-end weapons delivery
testing with the JDAM weapon is not likely to occur before December
2013. Several deficiencies of the mission systems and fire-control
system have been identified as ``must fix'' by the test team in order
for weapons integration to proceed. For example, a problem with
erroneous target coordinates derived from the synthetic aperture radar
mapping function, for which a potential fix has recently entered flight
test, and problems with the electro-optical tracking system mentioned
above, have significantly delayed weapons integration tests. The result
is that approximately 9 months of margin for regression and discovery
in weapons integration test plans has been used before the first end-
to-end developmental test event, and there is no margin remaining in
the schedule for completing testing and achieving integrations of both
the Block 2B or Block 3F weapons capabilities. Consequently, the final
Block 3F weapon integration tests are likely to be completed in late
2017, instead of fall 2016. This will make beginning operational
testing of Block 3F in January 2018 a challenge.

FATIGUE TESTING

Durability testing of all three variant ground test articles has
progressed as scheduled and the number and frequency of discoveries
have been consistent with what has been observed in testing of previous
fighter aircraft. The first of two aircraft lifetimes of testing has
been completed on the F-35A and F-35B; detailed inspections are
ongoing. Discoveries this year on the F-35A test article include cracks
in the engine thrust mount shear webs on both sides of the aircraft,
which are designed to carry some of the fore and aft engine load, and a
crack in the frame of the web stiffener located at fuselage station
402. The program has redesigned the thrust mounts for production cut in
with Low-Rate Initial Production 6, and retrofits to be completed on
earlier aircraft during depot modification periods. Root cause,
corrective action, and modification plans for the frame crack are to be
determined. Second lifetime testing for the F-35A is scheduled to start
in September 2013. The program plans to conduct third lifetime testing
on the F-35A test article beginning in the second quarter of calendar
year 2015.
Discoveries in the F-35B include cracks on the left and right hand
sides of the wing aft spar lower flanges and cracking in the frame of
the jack point stiffener, a portion of the support frame outboard of
the main fuselage above the main landing gear designed to support load
bearing of the aircraft during jacking operations. Redesign,
modification, and retrofit plans for these discoveries have not yet
been determined by the program. Second lifetime testing for the F-35B
is schedule to start in August 2013. Durability testing of the
redesigned auxiliary air inlet doors through two lifetimes (full test)
was completed on March 29, 2013. The program is investigating two
issues observed during testing, both of which involve the crank
assembly used to open and close the doors and were awaiting resolution
at the time of this testimony.
The F-35C fatigue test article restarted testing on January 9,
2013, after previously completing 4,000 hours of testing and associated
inspections; it has now completed 6,869 equivalent flight hours of
testing, or 86 percent of the first lifetime, as of May 21, 2013. The
program expects to complete first lifetime testing in August 2013.
Discovery of cracks in the floor of the avionics bay housing in
February 2013 caused a 2-month pause in testing while interim repairs
were completed, allowing testing to continue. Less than 1,000 hours of
testing later, more cracks were found in the floor of the avionics bay
housing and, similar to the F-35B, cracking in the frame of the jack
point stiffener was also discovered. Repairs, modifications, and
retrofits need to resolve these discoveries are to be determined. The
program plans to restart testing on June 12, 2013.

TRAINING SYSTEM

I reported on the F-35A Ready for Training OUE in February of this
year. In mid-2010, the JSF Program Executive Officer (PEO) requested an
assessment of the readiness to begin F-35A pilot training, which, at
that time, was planned to begin in August 2011. Throughout 2011 and
part of 2012, the JSF Program Office and the Air Force worked to
achieve a flight clearance that would allow pilot training to begin.
The JSF Operational Test Team (JOTT) completed a test plan using
evaluation criteria developed by Air Force Air Education and Training
Command (AETC) in mid-2011. The JSF PEO certified the system ready for
test following an Operational Test Readiness Review in July 2012,
leading to the start of the OUE in September.
The JOTT, JSF Program Office, and Air Force Air Education and
Training Command designed the Ready for Training OUE to assess whether
the F-35A aircraft and the training system were ready to begin training
pilots in the Block 1A syllabus. The Block 1A syllabus includes basic
aircraft systems training, emergency operating procedures, simulated
instrument flying procedures, ground operations (taxi), and six flights
in the F-35A, the last of which is a qualification and instrument
procedures check ride.
The Block 1A training syllabus used during the OUE was
substantially limited by the restrictions of the aircraft. Aircraft
operating limitations prohibited flying the aircraft at night or in
instrument meteorological conditions; hence, pilots needed to avoid
clouds and other weather. However, the student pilots are able to
simulate instrument flight in visual meteorological conditions to
practice basic instrument procedures. These restrictions were in place
because testing has not been completed to certify the aircraft for
night and instrument flight. These restrictions are still in place on
the training system.
The aircraft also were prohibited from flying close formation,
aerobatics, and stalls, all of which would normally be in this early
familiarization phase of transition training that typically is an
introduction to aircraft systems, handling characteristics throughout
the aircraft envelope, and qualification to operate/land in visual and
instrument meteorological conditions. This familiarization phase is
about one-fourth of the training in a typical fighter aircraft
transition or requalification course. In a mature fighter aircraft, the
familiarization phase is followed by several combat-oriented phases,
such as air combat, surface attack, and night tactical operations.
During the OUE, the F-35A did not have the capability to train in these
phases, nor any actual combat capability, because it is still early in
system development. The first F-35A aircraft configured in the Block 2A
capability, which will possess a limited ability to simulate weapons
deliveries, are being delivered to Eglin AFB this month. This may
enable more combat-oriented training, albeit still limited by envelope
restrictions and lacking integrated mission systems capability.
During the OUE, sustainment of the six Block 1A F-35A aircraft was
sufficient to meet the student training sortie requirements of the
syllabus, but with substantial resources and workarounds in place. Some
aircraft subsystems, such as the radar, did not function properly
during the OUE, although they were not required for accomplishing the
basic syllabus events. Had the syllabus been more expansive, where
these subsystems were required to complete training, these subsystem
problems would have hampered the completion of the OUE. Three
additional F-35A aircraft in the Block 1B configuration were also flown
during the OUE, by the instructor pilots, to meet sortie requirements.
The limitations, workarounds, and restrictions in place in an air
system this early in development limit the utility of training. Also,
little can be learned from evaluating training in a system this
immature. However, the evaluation indicated areas where the program
needs to focus attention and make improvements. The radar, the pilot's
helmet mounted display system, and the cockpit interfaces for
controlling the radios and navigational functions should be improved.
Discrepancies between the courseware and the flight manuals were
frequently observed, and the timelines to fix or update courseware
should be shortened. The training management system lags in development
compared to the rest of the Integrated Training Center and does not yet
have all planned functionality.
Since the OUE completed in November 2012, all six of the Block 1A
F-35A aircraft have been modified to the Block 1B configuration.
Training is ongoing at Eglin in the 9 Block 1B F-35As for the Air Force
and in the 11 Block 1B F-35Bs assigned to the Marine Corps.
Additionally, Eglin accepted its first Block 2A-configured F-35A in
May, which will be used for training in an expanded syllabus currently
under development. The Air Force intends to start training pilots in a
Block 2A syllabus in early 2014.

SHIP INTEGRATION

The program plans to conduct the second set of ship trials with two
F-35B test aircraft in August 2013. Test objectives for this deployment
include conducting night operations, carrying stores, evaluating the
carrier landing system, and expanding the take-off and vertical landing
envelope for varying wind-over-deck conditions and for a broader range
of aircraft weight and center of gravity conditions. Flying qualities
with an updated version of control software, based on data taken during
the first deployment, will be assessed. Two SDD test aircraft will be
operated by program test pilots during the test. Minimal changes to USS
Wasp are anticipated, as this will be the second deployment to the
ship. Some restrictions to the electromagnetic environment on the ship
may be necessary as a result of the electromagnetic environmental
effects testing on the aircraft. The logistics support environment will
not be representative of fleet operations; rather, it will be similar
to that used in the first ship trials in 2011 that employed workarounds
to reach back to land-based systems and personnel as necessary to
sustain operations.
The test center also plans to train additional test pilots to be
qualified in STOVL operations for the deployment, and for conducting
land-based work-up maneuvers.
The program intends to conduct the first set of carrier-based ship
trials with two F-35C test aircraft in the summer of 2014. The
prerequisite activity with the aircraft leading up to the sea-borne
trials is extensive. The new arresting hook system--which has yet to
start the planned verification, structural, or durability testing--will
have to be installed on both aircraft, and shore-based roll-in testing
and hook engagement testing completed with one aircraft, which will
compose approximately 6 months of testing. An improved nose landing
gear drag brace, required for catapult launches, will also be a part of
the pre-deployment set of modifications. Both aircraft will need to
undergo electromagnetic environmental effects testing prior to
deployment. For the carrier, the Department of the Navy is working
integration issues that will need to be resolved prior to the first
operational deployment, but will not necessarily be solved prior to the
first set of ship trials. Examples of integration issues include
storage of the lithium-ion batteries on the carrier, resupplying
engines while underway, and integration of the autonomic logistics
information system. Some initial noise and thermal effects testing have
been completed at land-based test facilities, and will be a part of the
test activity during the first ship trial period. Modifications of the
jet blast deflector system on the carrier may be necessary prior to the
ship-borne trials to ensure adequate cooling of the deflector during
JSF operations.

LIVE FIRE TEST AND EVALUATION

F-35 survivability is heavily dependent on its low-observability
features, advanced electronic systems (e.g., advanced sensors for
situational awareness, multispectral data fusion, datalinks, etc.), and
its advanced countermeasures. These features work together to reduce F-
35 threat susceptibility. However, no amount of susceptibility
reduction can eliminate the possibility of an F-35 being successfully
engaged, either by ground-based threats or by enemy aircraft,
particularly during high-risk missions such as visual close air support
and within-visual-range air-to-air combat (i.e., ``dog fighting''). In
such cases, the F-35 survivability can largely depend on its ability to
tolerate threat-induced damage; that is, its vulnerability reduction
features.
Live fire tests and analyses conducted during the last year focused
on the threats involved in these types of high-risk engagements to
assess the vulnerability of the F-35 propulsion system and to identify
any risks to propulsion integration, flight transition, stability and
control, and airframe structure:
--A range of operationally realistic threat encounter conditions were
considered in tests that evaluated engine vulnerability to fuel
ingestion events. Tests have shown that the engine can tolerate
ingestion of fuel leak rates representative of single-missile
fragment-induced damage to fuel tanks surrounding the engine
inlet. Further analysis is required to assess the impact of
multiple fragments, which are probable in any case where a
missile achieves a near miss on the aircraft, on engine
response to fuel ingestion. A Concept Demonstrator Aircraft
engine test in fiscal year 2005 showed that the engine could
not tolerate ingestion of fuel leak rates representative of
damage from a larger gun projectile impacting at low-altitude,
high-speed and high-engine thrust--a type of encounter that
might be expected on a close-air support mission.
The program made no design changes in response to these test
results. This vulnerability, accepted by the program leadership,
remains in the final, production engine design. The implications of
this vulnerability are exacerbated by the program's previous decision
to remove a fuel tank ballistic liner during its weight-reduction
efforts, saving 48 pounds. The ballistic liner could have reduced
threat-induced fuel leakage to levels this single-engine aircraft can
tolerate. A follow-on ballistic test is planned to re-evaluate
vulnerability to fuel ingestion.
--F-35B lift system live fire testing showed the system is tolerant
to selected single missile fragments. The single fragment-
induced damage to the lift fan produced in this test did not
degrade the overall propulsion system performance. Nonetheless,
analysis predicts that fragment-induced damage could result in
more severe effects that could lead to catastrophic lift system
failure (e.g., more than 25 percent lift fan blade loss leading
to fan disintegration) as a consequence of certain engagements.
To preserve the test article for future engine tests, such
engagement conditions were not tested. Other more severe
threats expected to be encountered in low-altitude flights or
air-to-air gun engagements, considered likely to cause critical
system failures leading to aircraft loss, were not tested
because their effects are well understood. Additional testing
of the sensitivities of the F-35B propulsion system to clutch
and shaft damage needs to be conducted.
--The tests also considered diagnostics to inform the pilot of
propulsion system damage. Damage to the static lift system
received in combat may not be detectable until the lift system
is engaged for a landing. The quickly accelerating fan might
fail catastrophically before the pilot can react and return the
aircraft to wing-borne flight. There are no sensors to warn the
pilot of damage to the system to prevent this situation.
Sensors in the Prognostics and Health Monitoring system monitor
rotating component vibrations for maintenance purposes and
could provide some warning, but they are not sufficiently
qualified to provide information to the pilot nor any timely
warning regarding damage to the vast majority of lift system
components. To ensure no aircraft is lost due to lift system,
engine, or control failures, it is imperative that the pilot be
aware of damage that occurred during regular flight to the F-
35B propulsion system at the earliest possible time when
converting to STOVL flight. Data analyses are ongoing to
identify controllability and damage indications that might be
available to the pilot.
Live fire test and evaluation (LFT&E) activities have also focused
on other concerns:
--On-Board Inert Gas Generator System (OBIGGS).--The program
completed the OBIGGS/lightning protection Critical Design
Review in February 2013. F-35B fuel system simulator testing
and ground tests on all three variants will be conducted in the
near term to verify that the redesigned system can provide fuel
tank protection from lightning and from threat induced fuel
tank explosion. Testing will include a spectrum of mission
profiles including high decent-rate dives to ensure OBIGGS
effectiveness without compromising fuel tank and wing structure
integrity. Inflight inerting protects the aircraft against
catastrophic fuel tank explosions, but not against damage to
the airframe resulting from lightning-induced currents. While
most line-replaceable units (e.g., actuators, components of the
electrical power system) have passed lightning tolerance
qualification testing, the existing F-35 airframe fasteners,
selected to satisfy weight reduction criteria, are not
lightning tolerant. Airframe inspections will be required
following known lighting strikes, which may be costly since
access to many fasteners is limited and penetrations though the
aircraft skin will be required. Lightning tolerance
qualification testing for any remaining components, along with
current injection tests, still need to be completed before
lifting the current restrictions upon aircraft operating within
25 miles of known lightning. The concept for providing
lightning protection for aircraft on the ground requires
periodic re-inerting of static aircraft using nitrogen bottle
carts to purge combustible air that diffuses back into the fuel
system over time. This approach could be very resource
intensive for an operational F-35 unit, requiring manpower and
sufficient nitrogen to re-inert each aircraft as often as every
24 hours. The program is evaluating the practicality of this
approach before considering its implementation.
--Polyalphaolefin Shut-Off Valve.--In fiscal year 2012, following
live fire tests that demonstrated F-35 vulnerability to
polyalphaolefin (PAO) fire (underneath the cockpit area), the
program re-evaluated installing a PAO shutoff system. In 2008,
the previous Director, Operational Test and Evaluation
recommended retaining this design feature after the program
decided on removal for weight reduction. Lockheed Martin is
working to design a PAO shutoff system providing the
sensitivity to detect leaks and respond with shutoff that
testing has demonstrated is needed. However, the design
solution details, results from cost/benefit studies, and the
official decision to reinstate this vulnerability reduction
feature, are not yet available.
--Fueldraulic Fuses.--A live fire test in fiscal year 2012
demonstrated the fueldraulics system is vulnerable to missile
fragments resulting in potential fire and loss of aircraft. An
F-35B engine fueldraulics line failure during a routine test
flight in January 2013 demonstrated a similar safety-related
concern with the fueldraulics system. The F-35 program should
reinstate an effective fueldraulics shutoff to inhibit fuel
flow in the event of a system leak. The fueldraulic shutoff
feature would mitigate a vulnerability that could be a result
of either threat-induced damage or system/mechanical failure.
--Chemical/Biological Vulnerability.--The program continues to make
progress in the development of the decontamination system in
preparation for the fiscal year 2017 full-up system-level test.
The Joint Service Aircrew Mask variant for the F-35, however,
has a high schedule risk because of the requirements for
integration with the F-35's helmet mounted display system.
--Gun Ammunition Lethality.--The U.S. Air Force is leading an
evaluation of a new frangible armor piercing design for the F-
35A ammunition; the Navy is evaluating existing PGU-32 semi-
armor piercing high explosive incendiary ammunition for the F-
35B and F-35C; and the Norwegian Ministry of Defense is
evaluating a new armor piercing explosive ammunition for its F-
35A variant and possibly the U.S. F-35B and F-35C variants.
Terminal ballistic tests of all ammunition variants against
common vehicle armor and masonry wall designs will start in
fiscal year 2013 and continue in fiscal year 2014. All test
data will feed Joint Munitions Effectiveness Models.

SUITABILITY

A logistics test and evaluation of the initial fielded release of
the Autonomic Logistics Information System (ALIS) version 1.0.3,
required to support the acceptance and flight operations of Block 1B
and 2A aircraft at Eglin, Edwards, Yuma and Nellis AFBs, was conducted
between September and October 2012. The test was conducted at Edwards
using two of the mission systems test aircraft updated with software to
be compatible with the new version of ALIS. The first version of ALIS
software used in the test, version 1.0.3A3, was found to be deficient
in response times at the beginning of the evaluation period, and an
updated software version--1.0.3A3.1--was developed and fielded to
permit the evaluation to proceed. Subsequent testing revealed numerous
significant deficiencies in ALIS, such as inaccurate recording of
component life--a key component of the prognostic health function--as
well as the health management component of the system requiring
unneeded, excessive grounding of aircraft. Post-flight delays in data
transfer lengthened aircraft turnaround time. Overall, 58 deficiency
reports were submitted from the evaluation, 4 of which were critical
(designated as Category 1) and the test team recommended not fielding
ALIS 1.0.3A3.1. The program developed and released another version of
the ALIS 1.0.3 software, version 1.0.3A3.2, to address some of the
deficiencies and more testing was accomplished in December 2012. The
software update allowed for manual data entries, vice relying on
automated processes embedded in the aircraft, to transfer data to ALIS.
Although the test team considered the software to be adequate for
fielding--and the 1.0.3A3.2 version is in use at Yuma, Nellis, and
Edwards AFBs (for the operational test aircraft)--the reliance on
manual data entry is laborious, prone to error, and not consistent with
the lean design of maintenance support expected for fielded operations.
The most recent reliability data for the F-35 fleet indicate that
all variants are currently below planned reliability performance for
failures directly chargeable to the primary contractors as well as for
flying hours between critical failures. The F-35A's demonstrated flying
time between critical failures is below 50 percent of the planned
level, while the F-35B and F-35C are just over 70 percent of the
planned level. The following subsystems have been problematic:
--Upper lift fan door actuator (F-35B only);
--Thermal management system fan;
--Nose landing gear brake assembly (F-35A/B only);
--270 volt DC battery;
--80 kW inverter/converter/controller;
--Augmentor fuel pump;
--Open-loop compressor isolation valve;
--Sensor for display processor, thermal management system;
--Ventilation nacelle fan; and
--Display management computer/helmet.
The direct time maintainers currently spend working on each
aircraft per flying hour is less than required for the full operational
system. However, fielded aircraft currently have very few functional
mission systems and no weapons capabilities, which resulted in fewer
failure modes and less demands on maintainer time. Additionally, direct
maintenance time does not include time spent on Action Requests
maintainers submit to Lockheed Martin when they cannot find a solution
to a maintenance problem in the aircraft technical data, or if they do
not trust results from the prognostic health management system.
Maintainers cannot proceed without a response to an Action Request. As
both the technical data and prognostic health management system are
immature, maintainers required a great deal of unreported time to deal
with Action Requests. As the program matures, the time needed to
fulfill Action Requests should decrease.

ELECTRONIC WARFARE

Early in 2012, I identified several critical shortfalls in test
resources needed to faithfully replicate current threats to JSF and
other weapon systems. These deficiencies in test capability prevent
adequate developmental and operational testing of the F-35. The
Department's budget now includes resources for improvements to open-air
range capabilities, an anechoic chamber, and the JSF electronic
warfare-reprogramming laboratory. We need to maintain a high degree of
urgency within the offices that have been made responsible for
delivering these resources to assure they will be available in time to
support JSF Block 3F operational testing in 2018; otherwise, that
testing will be delayed.

Senator Durbin. Thank you very much, Dr. Gilmore.
Mr. Sullivan.

STATEMENT OF MICHAEL J. SULLIVAN, DIRECTOR, ACQUISITION
AND SOURCING MANAGEMENT TEAM, U.S.
GOVERNMENT ACCOUNTABILITY OFFICE
Mr. Sullivan. Thank you, Mr. Chairman, Senator Cochran,
Senator Shelby. It is a pleasure to be here this morning to
discuss the F-35 Joint Strike Fighter acquisition program.
As the chairman pointed out, the program is now 12 years
old, having begun in 2001. Since then, its development cost has
grown by more than $20 billion, and the estimated average cost
to buy one F-35 has doubled from about $69 million to $137
million. Clearly, the program's original business case was
deeply flawed.
In 2012, after the program breached its cost estimate, the
Department did reset its business case. You talked about that
in the first panel. They added significant dollars to the cost
estimate, more time to deliver aircraft, and since then, the
manufacturing process appears to have stabilized and has shown
progress in delivering F-35 aircraft.
Today, however, we are here to discuss risks to this reset
business case moving forward, and from our perspective, there
are three. These are software development, concurrency between
flight testing and production, and the funding assumptions from
the program that underpin the current business case.
In the area of software development, the F-35 will depend
on about 24 million lines of software code, both on and off the
aircraft, to be able to fly and to meet its missions. Today
software delivery has continued to lag behind, and the
contractor continues to struggle to meet schedules. As long as
software delivery is questionable, the initial capability of
the aircraft is at risk.
With regard to concurrency, the program is now negotiating
its sixth and seventh production lots of aircraft. When that
negotiation is complete, it will have invested about $34
billion to procure 150 aircraft with less than half of the
flight testing completed. As we have heard repeatedly on the
first panel and from Dr. Gilmore, this creates risks that
problems found during testing will force design changes that
will have to be retrofit onto aircraft in production or already
delivered at additional cost to the Government.
Finally, the program's current cost estimate assumes annual
funding of more than $12 billion on average for development and
procurement over the next 24 years and continues to estimate
operation and support costs at over $1 trillion across the F-
35's 30-year lifecycle. The Department has already deemed this
unaffordable. It is setting targets to try to reduce this, and
the Congress may want to consider whether these funding
assumptions are reasonable in our current fiscal environment.

PREPARED STATEMENT

From our perspective, these are the risks that this
committee must weigh as the program moves forward. As it stands
today, the Department plans to buy almost 2,500 aircraft to
replace and improve upon today's fleet. If these risks are not
controlled and the cost of the F-35 grows much more, the
program is in danger of falling into a much too familiar cycle
of quantity reductions in order to meet budget, and that will
result in less buying power for the Department. It would also
force decisionmakers to consider other options for maintaining
our tactical fleet.
With that, I will conclude, Mr. Chairman. I would be happy
to answer questions.
[The statement follows:]

Prepared Statement of Michael J. Sullivan

F-35 JOINT STRIKE FIGHTER: RESTRUCTURING HAS IMPROVED THE PROGRAM, BUT
AFFORDABILITY CHALLENGES AND OTHER RISKS REMAIN

Chairman Durbin, Ranking Member Cochran, and members of the
subcommittee: Thank you for the opportunity to discuss our work on the
F-35 Lightning II, also known as the Joint Strike Fighter (JSF). At a
cost approaching $400 billion, the F-35 is the Department of Defense's
(DOD) most costly and ambitious acquisition program. The program is
developing and fielding three aircraft variants for the Air Force,
Navy, and Marine Corps and eight international partners. The F-35 is
the linchpin of U.S. and partner plans to replace existing fighters and
support future combat operations. In a time of austere Federal budgets,
DOD continues to project significant long-term sustained funding
requirements for the F-35 while, at the same time, pursuing several
other expensive systems. Over the past 3 years, DOD has extensively
restructured the F-35 program to address poor cost, schedule, and
performance outcomes. Most recently, in March 2012, DOD established a
new, more realistic, F-35 acquisition program baseline that reflects
increased costs, longer schedule times, and deferred procurement of 410
aircraft to the future. Appendix I tracks program baseline changes
since the start of system development in 2001.\1\
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\1\ See GAO Highlights at the end of this statement.
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We have reported annually on F-35 issues since 2005.\2\ My
testimony today is largely based on the results of our latest
review,\3\ and addresses (1) the progress the F-35 program made in 2012
and (2) the major risks that the program faces going forward. To
conduct our work, we reviewed program status reports and briefings,
management objectives, test plans and results, and internal DOD
analyses with a focus on accomplishments in calendar year 2012 compared
to original plans for that year. We obtained manufacturing data and
cumulative outputs from the start of production in 2007 through the end
of 2012, and discussed development and production issues and results to
date, future expansion plans, and improvement efforts with DOD, F-35
program, and contractor officials. We toured the aircraft manufacturing
plant, obtained production and supply performance indicators,
identified cumulative and projected engineering changes, and discussed
factory improvements and management controls with members of the
contractor's work force and DOD plant representatives. We evaluated
DOD's restructuring actions and impacts on the program, tracked cost
and schedule changes from program start to the March 2012 baseline, and
determined factors driving the changes. We obtained current projections
of acquisition funding needs through 2037 and estimated lifecycle
sustainment funding requirements. We conducted this work in accordance
with generally accepted government auditing standards.
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\2\ See related GAO products at the end of this statement.
\3\ GAO, F-35 Joint Strike Fighter: Current Outlook Is Improved,
but Long-Term Affordability Is a Major Concern, GAO-13-309 (Washington,
DC: March 11, 2013).
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F-35 PROGRAM PERFORMANCE IMPROVED IN 2012

The F-35 program made progress in 2012 on several fronts. The
program met or substantially met most of its key management and
development testing objectives for the year. We also found that the
program made progress in addressing key technical risks, as well as
improving software management, manufacturing, and supply processes.
Most Management and Development Testing Objectives Were Achieved
The F-35 program met or substantially met most of its key
management objectives established for calendar year 2012. The program
office annually establishes major management objectives that it wants
to achieve in the upcoming year. The F-35 program achieved 7 of its 10
primary objectives in 2012. Those included, among other things, the
completion of development testing on early increments of software, the
beginning of lab testing for both variations of the helmet mounted
display, the beginning of pilot training for two aircraft variants, and
the completion of negotiations on the restructured development
contract. Although the program did not complete its software block 3
\4\ critical design review as planned in 2012, it did successfully
complete its block 3 preliminary design review in November 2012 and the
critical design review in late January 2013. The program did not meet
its objectives to (1) deliver 40 production aircraft in 2012 and (2)
receive approval from the Defense Contract Management Agency of the
contractor's plan for correcting deficiencies in its system for
tracking and reporting cost and schedule progress.\5\
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\4\ Software capabilities are developed, tested, and delivered in
three major blocks. Block 3 is to provide the F-35 its full warfighting
capability.
\5\ This specifically refers to the contractor's Earned Value
Management System, which has been found to be deficient. Earned value
management is a disciplined process for tracking, controlling, and
reporting contract costs and schedule. DOD requires its use by major
defense suppliers to facilitate good insight and oversight of the
expenditure of Government dollars.
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The F-35 development flight test program also substantially met
2012 expectations with some revisions to original plans. The program
exceeded its planned number of flights by 18 percent, although it fell
short of its plan in terms of test points \6\ flown by about 3 percent,
suggesting that the flights flown were not as productive as expected.
Test officials had to make several adjustments to plans during the year
due to operating and performance limitations with aircraft and late
releases of software to test. As a result, none of the three variants
completed all of their planned 2012 baseline points, but the test team
was able to add and complete some test points that had been planned for
future years. Testing accomplished on each of the aircraft variants in
2012 included:
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\6\ Flight test points are specific, quantifiable objectives in
flight plans that are needed to verify aircraft design and performance.
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--Conventional Takeoff and Landing Variant (F-35A).--Accomplished
high angle of attack testing, initial weapons separation,
engine air start, expansion of the airspeed and altitude
envelopes, and evaluated flying qualities with internal and
external weapons.\7\
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\7\ Due primarily to operating restrictions and deficiencies in the
air refueling system, the F-35A did not accomplish as many flights as
planned and fell short of planned test points by about 15 percent.
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--Short Takeoff and Vertical Landing Variant (F-35B).--Accomplished
the first weapons release, engine air start tests, fuel dump
operations, flight envelope expansion with weapons loaded,
radar signature testing, and tested re-design air inlet doors
for vertical lift operations.
--Carrier Suitable Variant (F-35C).--Conducted speed and altitude
range verification and flights with external weapons, prepared
for simulated carrier landings, and conducted shore-based tests
of a redesigned arresting hook.

Progress Made in Addressing Key Technical Risks
In 2012, the F-35 program also made considerable progress in
addressing four areas of technical risk that if left unaddressed could
substantially degrade the F-35's capabilities and mission
effectiveness. However, additional work remains to fully address those
risks. These risk areas and the actions taken in 2012 are discussed
below:
1. Helmet Mounted Display (HMD).--DOD continued to address
technical issues with the HMD system. The original helmet mounted
display, integral to mission systems, encountered significant technical
deficiencies and did not meet warfighter requirements. The program is
pursuing a dual path by developing a second, less capable helmet while
working to fix the first helmet design. In 2012, DOD began dedicated
ground and flight testing to address these issues. Both variations of
the helmet mounted display are being evaluated and program and
contractor officials told us that they have increased confidence that
the helmet deficiencies will be fixed. DOD may make a decision in 2013
as to which helmet to procure.
2. Autonomic Logistics Information System (ALIS).--ALIS is an
important tool to predict and diagnose aircraft maintenance and supply
issues. ALIS systems with limited capability are in use at training and
testing locations. More capable versions of ALIS are being developed
and program and contractor officials believe that the program is on
track to fix previously identified shortcomings and field the fully
capable system in 2015. Limited progress was made in 2012 on developing
a smaller, transportable version needed to support unit level
deployments to operating locations.
3. Arresting Hook System.--The carrier variant arresting hook
system was redesigned after the original hook was found to be
deficient, which prevented active carrier trials. The program
accomplished risk reduction testing of a redesigned hook point to
inform this new design. The preliminary design review was conducted in
August 2012 and the critical design review in February 2013. Flight
testing of the redesigned system is slated for late 2013.
4. Structural Durability.--Over time, testing has discovered
bulkhead and rib cracks on the aircraft. Structural and durability
testing to verify that all three variants can achieve their expected
life and identify life-limited parts was completed in 2012. The program
is testing some redesigned structures and planning other modifications.
Officials plan to retrofit and test a production aircraft already built
and make changes to the production line for subsequent aircraft.
Current projections show the aircraft and modifications remain within
weight targets.

Software Management and Output Improved
In 2012, the F-35 aircraft contractor and program office took steps
to improve the program's software management and output. The program
began the process of establishing a second system integration
laboratory, adding substantial testing and development capacity. The
program also began prioritizing and focusing its resources on
incremental software development as opposed to the much riskier
concurrent development approach. In addition, the program began
implementing improvement initiatives recommended by an independent
software review, and evaluated the possible deferral of some of the
aircraft's capabilities to later blocks or moving them outside of the
current F-35 program altogether. At the same time, program data
regarding software output showed improvement. For example, program
officials reported that the time it took to fix software defects
decreased from 180 days to 55 days, and the time it took to build and
release software for testing decreased from 187 hours to 30 hours.

Manufacturing Process Metrics Improved
Key manufacturing metrics and discussions with defense and
contracting officials indicate that F-35 manufacturing and supply
processes improved during 2012. While initial F-35 production overran
target costs and delivered aircraft late, the latest data through the
end of 2012 shows labor hours decreasing and deliveries accelerating.
The aircraft contractor's work force has gained important experience
and processes have matured as more aircraft are built. We found that
the labor hours needed to complete aircraft at the prime contractor's
plant decreased, labor efficiency since the first production aircraft
improved, time to manufacture aircraft in the final assembly area
declined, factory throughput increased, and the amount of traveled work
declined. In addition, program data showed that the reliability and
predictability of the manufacturing processes increased while at the
same time aircraft delivery rates improved considerably. Figure 1
illustrates the improvement in production aircraft delivery timeframes
by comparing actual delivery dates against the dates specified in the
contracts.

FIGURE 1: F-35 PRODUCTION AIRCRAFT DELIVERIES COMPARED TO CONTRACT
DATES

Source: GAO analysis of DOD data.

Note: The numbered aircraft are in order of delivery. AF = U.S. Air
Force F-35A, BF = U.S. Marine Corps F-35B, CF = U.S. Department of the
Navy F-35C; and BK = United Kingdom F-35B.

F-35 PROGRAM STILL FACES RISKS

Ensuring that the F-35 is affordable and can be bought in the
quantities and timeframes required by the warfighter will be of
paramount concern to the Congress, U.S. military and international
partners. As we recently reported, the acquisition funding requirements
for the United States alone are currently expected to average $12.6
billion per year through 2037, and the projected costs of operating and
sustaining the F-35 fleet, once fielded, have been deemed unaffordable
by DOD officials. In addition, the program faces challenges with
software development and continues to incur substantial costs for
rework to fix deficiencies discovered during testing. As testing
continues additional changes to design and manufacturing processes will
likely be required, while production rates continue to increase.
Long-Term Affordability Remains a Concern
We recently concluded that while the March 2012 acquisition program
baseline places the F-35 program on firmer footing, the aircraft are
expected to cost more and deliveries to warfighters will take longer
than previously projected. The new baseline projects the need for a
total of $316 billion in development and procurement funding from 2013
through 2037, or an average of $12.6 billion annually over that period
(see figure 2). Maintaining this level of sustained funding will be
difficult in a period of declining or flat defense budgets and
competition with other ``big ticket items'' such as the KC-46 tanker
and a new bomber program. In addition, the funding projections assume
the financial benefits of the international partners purchasing at
least 697 aircraft. If fewer aircraft are procured in total or in
smaller annual quantities--by the international partners or the United
States--unit costs will likely rise according to analysis done by the
Office of the Secretary of Defense (OSD) Cost Assessment and Program
Evaluation (CAPE) office.

FIGURE 2: F-35 PROGRAM BUDGETED DEVELOPMENT AND PROCUREMENT FUNDING
REQUIREMENTS, FISCAL YEARS 2013-2037

Source: GAO analysis of DOD data.

Note: Development and procurement of the Marine Corps variant is
included in the Department of the Navy budget accounts.

In addition to the costs for acquiring aircraft, we found that
significant concerns and questions persist regarding the cost to
operate and sustain the F-35 fleet over the coming decades. The current
sustainment cost projection by CAPE for all U.S. aircraft, based on an
estimated 30-year service life, exceeds $1 trillion. Using current
program assumptions of aircraft inventory and flight hours, CAPE
recently estimated annual operating and support costs of $18.2 billion
for all F-35 variants compared to $11.1 billion spent on legacy
aircraft in 2010. DOD officials have declared that operating and
support costs of this magnitude are unaffordable and the department is
actively engaged in evaluating opportunities to reduce those costs,
such as basing and infrastructure reductions, competitive sourcing, and
reliability improvements.
Because of F-35 delays and uncertainties, the military services
have made investments to extend the service lives of legacy F-16 and F-
18 aircraft at a cost of $5 billion (in 2013 dollars). The Navy is also
buying new F/A-18E/F Super Hornets at a cost of $3.1 billion (in then-
year dollars) to bridge the gap in F-35 deliveries and mitigate
projected shortfalls in fighter aircraft force requirements. As a
result, the services will incur additional future sustainment costs to
support these new and extended-life aircraft, and will have a difficult
time establishing and implementing retirement schedules for existing
fleets.

Software Development Challenges Remain
Our report found that over time, F-35 software requirements have
grown in size and complexity and the contractor has taken more time and
effort than expected to write computer code, integrate it on aircraft
and subsystems, conduct lab and flight tests to verify it works, and to
correct defects found in testing. Although recent management actions to
refocus software development activities and implement improvement
initiatives appeared to be yielding benefits, software continued to be
a very challenging and high-risk undertaking, especially for mission
systems.\8\ While most of the aircraft's software code has been
developed, a substantial amount of integration and test work remain
before the program can demonstrate full warfighting capability. About
12 percent of mission systems capabilities have now been validated, up
from 4 percent about a year ago. However, progress on mission systems
was limited in 2012 by contractor delays in software delivery, limited
capability in the software when delivered, and the need to fix problems
and retest multiple software versions. Further development and
integration of the most complex elements--sensor fusion and helmet
mounted display--lie ahead.
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\8\ Mission systems are critical enablers of F-35's combat
effectiveness, employing next generation sensors with fused information
from on-board and off-board systems (i.e., electronic warfare,
communication navigation identification, electro-optical target system,
electro-optical distributed aperture system, radar, and data links).
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F-35 software capabilities are being developed, tested and
delivered in three major blocks and two increments--initial and final--
within each block. The testing and delivery status of the three blocks
is described below:
--Block 1.0, providing initial training capability, was largely
completed in 2012, although some final development and testing
will continue. Also, the capability delivered did not fully
meet expected requirements relating to the helmet, ALIS, and
instrument landing capabilities.
--Block 2.0, providing initial warfighting capabilities and limited
weapons, fell behind due to integration challenges and the
reallocation of resources to fix block 1.0 defects. The initial
increment, block 2A, delivered late and was incomplete. Full
release of the final increment, block 2B, has been delayed
until November 2013 and will not be complete until late 2015.
--Block 3.0 providing full warfighting capability, to include sensor
fusion and additional weapons, is the capability required by
the Navy and Air Force for declaring their respective initial
operational capability dates. Thus far, the program has made
little progress on block 3.0 software. The program intends
initial block 3.0 to enter flight test in 2013. This is rated
as one of the program's highest risks because of its
complexity.

Design Changes and Rework Continue to Add Cost and Risk
Although our recent review found that F-35 manufacturing, cost, and
schedule metrics have shown improvement, the aircraft contractor
continues to make major design and tooling changes and alter
manufacturing processes while development testing continues.
Engineering design changes from discoveries in manufacturing and
testing are declining in number, but are still substantial and higher
than expected from a program this far along in production. Further, the
critical work to test and verify aircraft design and operational
performance is far from complete. Cumulatively, since the start of
developmental flight testing, the program has accomplished 34 percent
of its planned flights and test points. For development testing as a
whole, the program verified 11.3 percent of the development contract
specifications through November 2012. As indicated in table 1, DOD
continues to incur financial risk from its plan to procure 289 aircraft
for $57.8 billion before completing development flight testing.

TABLE 1: F-35 PROCUREMENT INVESTMENTS AND FLIGHT TEST PROGRESS
--------------------------------------------------------------------------------------------------------------------------------------------------------
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cumulative procurement (then-year dollars in billions).......... $0.8 $3.5 $7.1 $14.3 $21.3 $27.6 $33.8 $40.1 $47.9 $57.8 $69.0
Cumulative aircraft procured.................................... 2 14 28 58 90 121 150 179 223 289 365
Percent total flight test points completed...................... -- <1% <1% 2% 9% 22% 34% 54% 74% 91% 100%
--------------------------------------------------------------------------------------------------------------------------------------------------------
Source: GAO analysis of DOD data.
Notes: Years listed denote fiscal years. Flight test data reflects the percentage of total flight test points completed in time to inform the next
year's procurement decision. For example above, the F-35 program accomplished about 22 percent of total planned flight test points through the end of
calendar year 2011 that could help inform the fiscal year 2012 procurement decision. The program intends to complete developmental flight test points
in 2016 and would be in a position to fully support the 2017 procurement buy.

This highly concurrent approach to procurement and testing
increases the risk that the Government will incur substantial costs to
retrofit (rework) already produced aircraft to fix deficiencies
discovered in testing. In fact, the F-35 program office projects rework
costs of about $900 million to fix the aircraft procured on the first
four annual procurement contracts. Substantial rework costs are also
forecasted to continue through the 10th annual contract (fiscal year
2016 procurement), but at decreasing amounts annually and on each
aircraft. The program office projects about $827 million more to rework
aircraft procured under the next 6 annual contracts.

DEPARTMENT OF DEFENSE ACTIONS ON GOVERNMENT ACCOUNTABILITY OFFICE
RECOMMENDATIONS HAVE VARIED, BUT F-35 RESTRUCTURING WAS A POSITIVE STEP

We have reported on F-35 issues for over a decade and have found
that the magnitude and persistence of the program's cost and schedule
problems can be largely traced to (1) decisions at key junctures made
without adequate product knowledge; and (2) a highly concurrent
acquisition strategy that significantly overlapped development,
testing, and manufacturing activities.\9\ Over that time, our reports
included numerous recommendations aimed at reducing risk in these areas
and improving the chances for successful outcomes.\10\
---------------------------------------------------------------------------
\9\ We have an extensive body of work looking at knowledge-based
best practices in successful private and public acquisitions of new
technology. Defense policy and the Weapon Systems Acquisition Reform
Act of 2009 incorporate elements of the knowledge-based approach. For
an overview of the best practices criteria and methodologies, and how
current defense programs including the F-35 fared, see GAO, Defense
Acquisitions: Assessments of Selected Weapon Programs, GAO-12-400SP
(Washington, DC: March 29, 2012).
\10\ See related GAO products for a list of previous F-35 reports.
---------------------------------------------------------------------------
DOD has implemented our recommendations to varying degrees. For
example, in 2001 we recommended that DOD delay the start of system
development until the F-35's critical technologies were fully mature.
DOD disagreed with that recommendation and chose to begin the program
with limited knowledge about critical technologies. Several years
later, we recommended that DOD delay the production decision until
flight testing had shown that the F-35 would perform as expected, and
although DOD partially concurred with our recommendation, it chose to
initiate production before sufficient flight testing had been done.
Citing concerns about the overlap--or concurrency--among development,
testing, and production, we have recommended that DOD limit annual
production quantities until F-35 flying qualities could be
demonstrated. Although DOD disagreed with our recommendation at the
time, it has since restructured the F-35 program and, among other
things, deferred the production of hundreds of aircraft into the
future, thus addressing the intent of our recommendation and reducing
program risk. Appendix II lists these and other key recommendations we
have made over time, and identifies the actions DOD has taken in
response.
In conclusion, while the recent restructuring of the F-35 program
placed it on a firmer footing, tremendous challenges still remain. The
program must fully validate the F-35's design and operational
performance against warfighter requirements, while at the same time
make the system affordable so that the United States and partners can
acquire new capabilities in the quantity needed and can then sustain
the force over its lift cycle. Ensuring overall affordability will be a
challenge as more austere budgets are looming.
Chairman Durbin, Ranking Member Cochran and members of the
subcommittee, this completes my prepared statement. I would be pleased
to respond to any questions you may have.
______

APPENDIX I: CHANGES IN REPORTED F-35 PROGRAM QUANTITY, COST, AND DELIVERIES, 2001-2012
----------------------------------------------------------------------------------------------------------------
October 2001 December
(system 2003 March 2007 June 2010 March 2012
development (approved (approved (Nunn- (approved
start) baseline) baseline) McCurdy) baseline)
----------------------------------------------------------------------------------------------------------------
Expected Quantities

Development quantities.................... 14 14 15 14 14
Procurement quantities (U.S. only)........ 2,852 2,443 2,443 2,443 2,443
---------------------------------------------------------------------
Total quantities........................ 2,866 2,457 2,458 2,457 2,457
=====================================================================
Cost Estimates
(then-year dollars in billions)

Development............................... $34.4 $44.8 $44.8 $51.8 $55.2
Procurement............................... 196.6 199.8 231.7 325.1 335.7
Military construction..................... 2.0 0.2 2.0 5.6 4.8
---------------------------------------------------------------------
Total program acquisition............... $233.0 $244.8 $278.5 $382.5 $395.7
=====================================================================
Unit Cost Estimates
(then-year dollars in millions)

Program acquisition....................... $81 $100 $113 $156 $161
Average procurement....................... 69 82 95 133 137

Estimated Delivery and Production Dates

First production aircraft delivery........ 2008 2009 2010 2010 2011
Initial operational capability............ 2010-2012 2012-2013 2012-2015 TBD TBD
Full-rate production...................... 2012 2013 2013 2016 2019
----------------------------------------------------------------------------------------------------------------
Source: GAO analysis of DOD data.
Note: TBD means to be determined.

APPENDIX II: PRIOR GAO REPORTS AND DOD RESPONSES
------------------------------------------------------------------------
Est.
dev.
costs
GAO dev. Key program Primary GAO DOD response and
report length event message actions
aircraft
unit
cost
------------------------------------------------------------------------
2001 $34.4 Start of system Critical DOD did not
GAO-02-3 billion development and technologies delay start of
9 10 years demonstration needed for key system
$69 approved. aircraft development and
million performance demonstration
elements not stating
mature. Program technologies
should delay were at
start of system acceptable
development maturity levels
until critical and will manage
technologies risks in
mature to development.
acceptable
levels.

2005 $44.8 The program We recommended DOD partially
GAO-05-2 billion undergoes re- that the concurred but
71 12 years plan to address program reduce did not adjust
$82 higher than risks and strategy,
million expected design establish believing that
weight, which executable its approach is
added $7 business case balanced
billion and 18 that is between cost,
months to knowledge-based schedule and
development with an technical risk.
schedule. evolutionary
acquisition
strategy.

2006 $45.7 Program sets in The program DOD partially
GAO-06-3 billion motion plan to planned to concurred but
56 12 years enter enter did not delay
$86 production in production with start of
million 2007 shortly less than 1 production
after first percent of because it
flight of the testing believed the
nonproduction complete. We risk level was
representative recommended appropriate.
aircraft. program delay
investing in
production
until flight
testing shows
that JSF
performs as
expected.

2007 $44.5 Congress reduced Progress was DOD nonconcurred
GAO-07-3 billion funding for being made but and felt that
60 12 years first two low- concerns the program had
$104 rate production remained about an acceptable
million buys thereby undue overlap level of
slowing the in testing and concurrency and
ramp up of production. We an appropriate
production. recommended acquisition
limits to strategy.
annual
production
quantities to
24 a year until
flying
quantities are
demonstrated.

2008 $44.2 DOD implemented We believed new DOD did not
GAO-08-3 billion a Mid-Course plan increased revise risk
88 12 years Risk Reduction risks and DOD plan or restore
$104 Plan to should revise testing
million replenish it to address resources,
management testing, stating that it
reserves from management will monitor
about $400 reserves, and the new plan
million to manufacturing and adjust it
about $1 concerns. We if necessary.
billion by determined that Consistent with
reducing test the cost a report
resources. estimate was recommendation,
not reliable a new cost
and that a new estimate was
cost estimate eventually
and schedule prepared, but
risk assessment DOD refused to
is needed. do a risk and
uncertainty
analysis.

2009 $44.4 The program Moving forward DOD agreed to
GAO-09-3 billion increased the with an report its
03 13 years cost estimate accelerated contracting
$104 and adds a year procurement strategy and
million to development plan and use of plans to
but accelerated cost Congress and
the production reimbursement conduct a
ramp up. contracts is schedule risk
Independent DOD very risky. We analysis. The
cost estimate recommended the program
(JET I) program report completed the
projects even on the risks first schedule
higher costs and mitigation risk assessment
and further strategy for with plans to
delays. this approach. update semi-
annually. The
Department
announced a
major
restructuring
reducing
procurement and
moving to fixed-
price
contracts.

2010 $49.3 The program was Costs and DOD continued
GAO-10-3 billion restructured to schedule delays restructuring,
82 15 years reflect inhibit the increasing test
$112 findings of program's resources and
million recent ability to meet lowering the
independent needs on time. production
cost team (JET We recommended rate.
II) and the program Independent
independent complete a full review teams
manufacturing comprehensive evaluated
review team. As cost estimate aircraft and
a result, and assess engine
development warfighter and manufacturing
funds IOC processes. Cost
increased, test requirements. increases later
aircraft were We suggest that resulted in a
added, the Congress Nunn-McCurdy
schedule was require DOD to breach.
extended, and tie annual Military
the early procurement services are
production rate requests to currently
decreased. demonstrated reviewing
progress. capability
requirements as
we recommended.

2011 $51.8 Restructuring The DOD concurred
GAO-11-3 billion continued with restructuring with all three
25 16 years additional actions are of the
$133 development positive and if recommendations
million cost increases; implemented . DOD lifted
schedule properly, STOVL
growth; further should lead to probation,
reduction in more achievable citing improved
near-term and predictable performance.
procurement outcomes. Subsequently,
quantities; and Concurrency of DOD further
decreased the development, reduced
rate of test, and procurement
increase for production is quantities,
future substantial and decreasing
production. The provides risk funding
Secretary of to the program. requirements
Defense placed We recommended through 2016.
the STOVL the program The initial
variant on a 2 maintain independent
year probation; funding levels software
decoupled STOVL as budgeted; assessment
from the other establish began in and
variants; and criteria for ongoing reviews
reduced STOVL STOVL are planned
production probation; and through 2012.
plans for conduct an
fiscal years independent
2011 to 2013. review of
software
development,
integration,
and test
processes.

2012 $55.2 The program Extensive DOD partially
GAO-12-4 billion established a restructuring concurred with
37 18 years new acquisition places the conducting an
$137 program program on a analysis on the
million baseline and more achievable impact of lower
approved the course. Most of annual funding
continuation of the program's levels and
system instability concurred with
development, continues to be assessing the
increasing concurrency of supply chain
costs for development, and
development and test, and transportation
procurements production. We network.
and extending recommend the
the period of Cost Assessment
planned Program
procurements by Evaluation
2 years. office conduct
an analysis on
the impact of
lower annual
funding levels;
JSF program
office conducts
an assessment
of the supply
chain and
transportation
network.
------------------------------------------------------------------------
Note: Est. dev. is abbreviation of estimated development.
Source: DOD data and GAO analysis in prior reports cited above.

RELATED GOVERNMENT ACCOUNTABILITY OFFICE PRODUCTS

Defense Acquisitions: Assessments of Selected Weapon Programs. GAO-13-
294SP. Washington, DC: March 28, 2013.

F-35 Joint Strike Fighter: Current Outlook Is Improved, but Long-Term
Affordability Is a Major Concern. GAO-13-309. Washington, DC: March 11,
2013.

Joint Strike Fighter: DOD Actions Needed to Further Enhance
Restructuring and Address Affordability Risks. GAO-12-437. Washington,
DC: June 14, 2012.

Joint Strike Fighter: Restructuring Added Resources and Reduced Risk,
but Concurrency Is Still a Major Concern. GAO-12-525T. Washington, DC:
March 20, 2012.

Joint Strike Fighter: Implications of Program Restructuring and Other
Recent Developments on Key Aspects of DOD's Prior Alternate Engine
Analyses. GAO-11-903R. Washington, DC: September 14, 2011.

Joint Strike Fighter: Restructuring Places Program on Firmer Footing,
but Progress Still Lags. GAO-11-325. Washington, DC: April 7, 2011.

Joint Strike Fighter: Additional Costs and Delays Risk Not Meeting
Warfighter Requirements on Time. GAO-10-382. Washington, DC: March 19,
2010.

Joint Strike Fighter: Accelerating Procurement before Completing
Development Increases the Government's Financial Risk. GAO-09-303.
Washington DC: March 12, 2009.

Joint Strike Fighter: Recent Decisions by DOD Add to Program Risks.
GAO-08-388. Washington, DC: March 11, 2008.

Joint Strike Fighter: Progress Made and Challenges Remain. GAO-07-360.
Washington, DC: March 15, 2007.

Joint Strike Fighter: DOD Plans to Enter Production before Testing
Demonstrates Acceptable Performance. GAO-06-356. Washington, DC: March
15, 2006.

Tactical Aircraft: Opportunity to Reduce Risks in the Joint Strike
Fighter Program with Different Acquisition Strategy. GAO-05-271.
Washington, DC: March 15, 2005.

GOVERNMENT ACCOUNTABILITY OFFICE HIGHLIGHTS

June 19, 2013

Highlights of GAO-13-690T, a testimony before the Subcommittee on
Defense, Committee on Appropriations, United States Senate

F-35 JOINT STRIKE FIGHTER: RESTRUCTURING HAS IMPROVED THE PROGRAM, BUT
AFFORDABILITY CHALLENGES AND OTHER RISKS REMAIN

Why GAO Did This Study
The F-35 Lightning II, the Joint Strike Fighter, is DOD's most
costly and ambitious aircraft acquisition. The program is developing
and fielding three aircraft variants for the Air Force, Navy, Marine
Corps, and eight international partners. The F-35 is critical to long-
term recapitalization plans as it is intended to replace hundreds of
existing aircraft. This will require a long-term sustained funding
commitment. Total U.S. investment is nearing $400 billion to develop
and procure 2,457 aircraft through 2037. Fifty-two aircraft have been
delivered through 2012. The F-35 program has been extensively
restructured over the last 3 years to address prior cost, schedule, and
performance problems. DOD approved a new acquisition program baseline
in March 2012.
This testimony is largely based on GAO's recently released report,
GAO-13-309. This testimony discusses (1) progress the F-35 program made
in 2012, and (2) major risks that program faces going forward. GAO's
work included analyses of a wide range of program documents and
interviews with defense and contractor officials.

What GAO Recommends
GAO's prior reviews of the F-35 made numerous recommendations to
help reduce risk and improve outcomes. DOD has implemented those
recommendations to varying degrees.

What GAO Found
The new F-35 acquisition baseline reflects positive restructuring
actions taken by the Department of Defense (DOD) since 2010, including
more time and funding for development and deferred procurement of more
than 400 aircraft to future years. Overall, the program progressed on
several fronts during 2012 to further improve the current outlook. The
program achieved 7 of 10 key management objectives and made substantial
progress on one other. Two objectives on aircraft deliveries and a
corrective management plan were not met. The F-35 development test
program substantially met expectations with some revisions to flight
test plans and made considerable progress addressing key technical
risks. Software management practices and some output measures improved,
although deliveries to test continued to lag behind plans.
Manufacturing and supply processes also improved--indicators such as
factory throughput, labor efficiency, and quality measures were
positive. While initial F-35 production overran target costs and
delivered aircraft late, the latest data shows labor hours decreasing
and deliveries accelerating.
Going forward, the F-35 program still faces considerable challenges
and risks. Ensuring that the F-35 is affordable and can be bought in
the quantities and time required by the warfighter will be a paramount
concern to the Congress, DOD, and international partners. With more
austere budgets looming, F-35 acquisition funding requirements average
$12.6 billion annually through 2037 (see below). Once fielded, the
projected costs of sustaining the F-35 fleet have been deemed
unaffordable by DOD officials; efforts to reduce these costs are
underway. Software integration and test will be challenging as many
complex tasks remain to enable full warfighting capability. The program
is also incurring substantial costs for rework--currently projected at
$1.7 billion over 10 years of production--to fix problems discovered
during testing. With two-thirds of development testing still to go,
additional changes to design and manufacturing are likely. As a result,
the program continues to incur financial risk from its plan to procure
289 aircraft for $57.8 billion before completing development flight
testing.

F-35 JOINT STRIKE FIGHTER ACQUISITION FUNDING REQUIREMENTS

Source: GAO analysis of DOD data.

Senator Durbin. Thanks, Mr. Sullivan.
Mr. O'Hanlon.

STATEMENT OF MICHAEL O'HANLON, SENIOR FELLOW AND
DIRECTOR OF RESEARCH FOR THE FOREIGN POLICY
PROGRAM, BROOKINGS INSTITUTION
Mr. O'Hanlon. Good morning, Senators. It is an honor to be
here.
I would like to do something a little different with my
testimony and that is just to sketch out an alternative way to
think about the F-35 and how many we might buy instead of the
program of record of close to 2,500. And what I want to do is
form a premise of acknowledging the need for the program and,
frankly, the excellence of the plane. I think we have heard a
lot of very good technical discussion that you in the Congress
pushed the Pentagon to continually work on, which is to make
this plane operationally effective, to make it realistically
priced, and to take this very difficult concept and make it
work. And all that is challenging and all that is hard. There
have been mistakes along the way, but I support the plane.
Having said that, I think there was a fundamental
assumption in the way the overall procurement buy was sized
that I would challenge, and I think to put it simply, we came
up with a number of planes to replace existing force structure,
close to one for one, not exactly one for one, but we
essentially looked at aircraft like the Harrier jet and the F-
16 and the F-18 and several others, and we said how many of
them do we have. We want to keep the majority of the force
structure that those different types of planes, roughly half a
dozen, currently populate, and that takes close to 2,500
aircraft. Now, I think there was an assumption that the F-35
could be a little better and produce a little more
effectiveness, maybe a little higher sortie rate or kill rate
per sortie. But, nonetheless, you essentially were replacing
force structure. And the hope was that if you had all three
Services cooperate and you bought a lot and you got
international partners, you could drive down unit cost.
But, Senator Durbin, I do have some sympathy for your image
of creating a program that is too big to fail not because I am
opposed to this program but because I think we have put a
tremendous number of eggs in one basket, and we have done it in
this hope or in this expectation that we can drive down unit
cost so much as to make that logic work.
I would come up with a different approach to sizing the
number of planes I would buy, which is a threat-based approach.
In other words, what parts of the world, which potential
adversaries and scenarios are going to require us to have a lot
of fifth generation ground attack aircraft and also air
superiority aircraft? And I think primarily of advanced
aircraft made by Russia and China, as was mentioned in the
first panel, as well as some of the advanced air-to-air and
surface-to-air capabilities. And we hear about those even in
conflicts like Syria. So I acknowledge that it would be nice to
have F-35s everywhere for everything because you never know
where there is going to be an advanced SAM. But realistically
speaking, we have done a lot of operations around the world the
last two decades with extremely low attrition rates to our
airplanes with fourth generation planes, and I think a lot of
our future military missions will continue in that vein.
So I would recommend sizing the future purchases of this F-
35 plane primarily to the threat environment and principally to
the possibility that China could be an adversary. I do not
expect that. I certainly do not hope that, but it is a
possibility we have to plan for. And also, of course, Iran.
Those would be the two most prominent cases. There could be
others. I would basically want to have enough high-end
airplanes that for a scenario that I can imagine and war game,
that for the bases that we are going to have available to us in
that region of the world, that we can fill them up with as many
F-22s and F-35s as we think appropriate. That is the way I
would size it. It is a threat-based approach.
Now, once you accept that premise, then you can have a more
detailed conversation about what do you do to each of the three
variants. And in my testimony, I spell out one specific
proposal. It is certainly debatable. Even if you accept that
main premise, there are different ways you could implement it.
I could go through it, but maybe I will save most of that for
discussion.
I will point out that I do support the F-35B, the Marine
Corps variant, because I worry about runways being threatened
in the future and being damaged. And I like the idea of a short
take-off vertical landing airplane. But people can debate that
as well.

PREPARED STATEMENT

The overall point here is--I will conclude on this simple
observation--if you were to cut the purchases in half overall--
I am recommending we buy about 1,200, 1,250 instead of 2,450--
you are only going to save about maybe 20-25 percent of the
total program cost because most of that force structure you
still want to keep, which means you have to buy something else
or refurbish something else to keep it going. And so those
refurbished F-16s and so on are still going to cost money. So I
do not consider this to be an easy way to lop off hundreds of
billions of dollars from expected Pentagon spending, but I
think you might be able to save, let us say, 20 percent in the
acquisition costs of the program, something in that
neighborhood, with this approach.
Thank you.
[The statement follows:]

Prepared Statement of Michael O'Hanlon

Thank you for the opportunity to testify today on the important and
impressive Lightning II aircraft. The bottom line of my testimony is
that I favor purchasing roughly half the number of jets now scheduled
to be acquired by the Department of Defense over the next two
decades.\1\
---------------------------------------------------------------------------
\1\ This testimony is drawn largely from my recent Brookings book,
Healing the Wounded Giant: Maintaining Military Preeminence While
Cutting the Defense Budget.
---------------------------------------------------------------------------
In other words, while I am a supporter of the program, I am also a
critic about the scale of the planned procurement. Even as drones have
become much more effective, even as precision-guided ordnance has
become devastatingly accurate, and even as real-time surveillance and
information grids have evolved rapidly, plans for modernizing manned
combat systems have remained essentially at previous quantitative
levels.
All together, the Air Force, Navy, and Marine Corps still plan to
buy nearly 2,500 F-35 combat jets at a total acquisition price of more
than $300 billion in constant 2013 dollars. Production is just
beginning at low rates, with the big ramp-up expected in the next few
years. The Pentagon will spend about $15 billion annually on the plane
starting in mid-decade. Three-fourths of the projected funds are yet to
be spent. The Pentagon's independent cost assessment office believes
the average unit procurement price could be 15 to 20 percent higher
than official estimates, exceeding $115 million per plane in 2013
dollars. And once purchased, the same office estimates that the F-35
will also cost one-third more to operate in real terms than planes like
the F-16 and F-18 that it is replacing.\2\
---------------------------------------------------------------------------
\2\ Statement of Christine H. Fox, director of cost assessment and
program evaluation, Department of Defense, before the Senate Armed
Services Committee, May 19, 2011 (www.armed-
services.senate.gov/e_witnesslist.cfm?id=5213); and Andrea Shalal-Ela,
``Exclusive: U.S. Sees Lifetime Cost of F-35 Fighter at $1.45
Trillion,'' Reuters, March 29, 2012 (www.reuters.com/
article/2012/03/29/us-lockheed-fighter-idUSBRE82S03L20120329).
---------------------------------------------------------------------------
It is important to acknowledge some strengths of the F-35, though,
and to challenge some common criticisms. Some have opposed the Marine
Corps variant of the plane (the F-35B), with its extra engine as needed
for short or vertical take offs and landings. But in fact, that variant
has value for an era in which airfields are increasingly vulnerable to
precision ordnance of the types that countries such as Iran and China
are fielding. The United States needs enough F-35Bs to be able to
populate bases nearest potential combat zones, such as the Gulf States
(for scenarios involving Iran) and Okinawa (in regard to China). As
Marine Corps Commandant General James Amos has noted, there are 10
times as many 3,000 foot runways in the world adequate for such short-
takeoff jets as there are 8,000 foot runways suitable for conventional
aircraft--and the Marines can lay down an expeditionary 3,000 foot
runway in a matter of days in other places.\3\
---------------------------------------------------------------------------
\3\ See Statement of General James F. Amos before the House Armed
Services Committee on the 2011 Posture of the United States Marine
Corps, March 1, 2011, p. 13 (http://armedservices.house.gov/index.cfm/
files/serve?File_id=6e6d479e-0bea-41a1-8f3d-44b3147640fe).
---------------------------------------------------------------------------
An alternative concept for F-35 production could be as follows:
--Purchase a total of 1,250 instead of 2,500.
--Leave the Marine Corps plan largely as is, scaling back only by 10
to 20 percent to account more fully for the proven capacity of
unmanned aerial vehicles to carry out some missions previously
handled by manned aircraft.
--Cancel the Navy variant (the F-35C), with its relatively limited
range compared with likely needs--buying more F/A-18 E/F Super
Hornets in the meantime while committing more firmly to
development of a longer range unmanned carrier-capable attack
aircraft.\4\ The X-47B unmanned system, which completed
demonstration tests on a carrier in 2012, is scheduled to
conduct flight operations from an aircraft carrier in 2013, so
this capability is progressing.\5\
---------------------------------------------------------------------------
\4\ See Captain Henry J. Hendicks and Lt. Col. J. Noel Williams,
``Twilight of the $UPERfluous Carrier,'' Proceedings (U.S. Naval
Institute, May 2011) (www.usni.org/magazines/proceedings/2011-05/
twilight-uperfluous-carrier).
\5\ Northrop Grumman, ``X-47B UCAS,'' (Washington: 2013)
(www.as.northropgrumman.com/products/nucasx47b/index.html). An
additional virtue of unmanned systems is the ability to conduct
training for pilots less expensively.
---------------------------------------------------------------------------
--Reduce Air Force numbers, currently expected to exceed 1,700 F-35
planes, by almost half.
Of the 800 planes that the Air Force was counting on, but would not
get under this approach, the difference can be made up in the following
ways. First, cut back 200 planes by eliminating two tactical fighter
wings. Second, view the 200 large combat-capable unmanned aerial
vehicles (UAVs) currently owned by the Air Force, together with the 300
or more on the way, as viable replacements for some manned fighter
planes. The Air Force is buying the equivalent of five wings of large
UAVs; perhaps it could transform two manned combat wings into unmanned
combat aircraft wings as a result.\6\ For the remaining planes, employ
further purchases of F-16 jets and refurbishments of existing F-16s to
make up the difference as needed.\7\
---------------------------------------------------------------------------
\6\ See U.S. Air Force, Fact Sheet on MQ-9 Reaper, January 2012
(www.af.mil/information/
factsheets/factsheet.asp?id=6405); and Congressional Budget Office,
Policy Options for Unmanned Aircraft Systems (Washington: June 2011),
pp. ix-x (www.cbo.gov/sites/default/files/cbofiles/ftpdocs/121xx/
doc12163/06-08-uas.pdf).
\7\ These are ongoing; see Bill Carey, ``F-35 Delay Forces $3
Billion Upgrade Request for U.S. Air Force F-16s'' AINOnline, November
4, 2011 (www.ainonline.com/aviation-news/ain-defense-perspective/2011-
11-04/f-35-delay-forces-3-billion-upgrade-request-us-air-force-f-16s).
---------------------------------------------------------------------------
This approach will produce net savings of some $60 billion in Air
Force aircraft purchase costs. The F-16 option is still available since
the production line is currently making aircraft for Morocco and Oman
among others, but it may not remain open for more than a couple years,
so this option could have to be exercised fairly promptly to make
economic sense.\8\ Additional savings in the Marine Corps and Navy will
add up to another $20 billion to $25 billion.
---------------------------------------------------------------------------
\8\ Leithen Francis, ``Mission Impossible,'' Aviation Week and
Space Technology, August 15, 2011, p. 27.
---------------------------------------------------------------------------
Average annual savings from this alternative approach to F-35
production might be $5 billion. Over time up to another $2 billion a
year or so in savings would be achievable in operating accounts from
the sum total of all these changes in tactical aircraft. These savings
will not kick in right away, since it is important to get the F-35
production line working efficiently to keep unit costs in check. More
of the savings will accrue in the 2020s.
It should also be remembered that a fair amount of risk is inherent
in this alternative plan, since entirely canceling the F-35C Navy
version of the plane will leave the Navy with less stealthy aircraft
over the next decade. This is probably a tolerable risk but is not a
trivial one.\9\ In an era of fiscal austerity and defense budget cuts,
we need to take calculated risks in defense planning as a nation--not
reckless risks, but calculated and reasonable ones. I believe that
halving the size of the planned overall F-35 buy follows that
philosophy properly and prudently.
---------------------------------------------------------------------------
\9\ The chief of naval operations, while not abandoning support for
the F-35C, has nonetheless voiced some doubts about the central role of
stealth in future force planning. See Admiral Jonathan W. Greenert,
``Payloads over Platforms: Charting a New Course,'' Proceedings, vol.
138, no. 7 (U.S. Naval Institute, July 2012) (www.usni.org/magazines/
proceedings/2012-07/payloads-over-platforms-charting-new-course).

Senator Durbin. Thanks, Mr. O'Hanlon. And that gets to the
question I would like to ask.
This committee has been handed the baton on one of the last
legs of the race. We hope it is the last leg of the race on the
F-35. And the question, obviously, looking back on the earlier
stages of the race, how could we have done this better, how
could we be further ahead, less cost?
Going back to the beginning, Mr. Sullivan, looking at what
we were trying to achieve 12 years ago, anticipating a threat,
anticipating technology changes, how did we miss it by so much
where the unit cost of the airplane is almost double what we
thought it would be? And what could we have done differently to
be in a better place today?
Mr. Sullivan. First of all, I would say that this program
is not unique in many ways. A lot of the major acquisitions go
down this exact same road. I think it is very complex why
programs get off to this kind of start, but if you look at the
mechanics of a program, just the best way to set a business
case, I think where this program went wrong when it set
requirements and it did not do enough due diligence up front
before it had its milestone B in 2001 and the requirements
were, more or less, not achievable with the resources that they
were estimating at that time. So they made a cost estimate
based on parametric analysis, no real actuals, quantum leap in
capability. It is very hard to model. You know, they talk about
modeling and simulation to prove that you can do things, but
you cannot really model some of the capabilities that they had
here.
So they had very immature technologies when they started. A
number of the technologies--there were eight critical
technologies on this aircraft in 2001 that they knew they would
have to have to be capable to meet requirements.
Senator Durbin. Let me go to the point that Dr. Gilmore
raised and perhaps Mr. O'Hanlon also alluded to. This notion
that you would somehow put this aircraft in the hands of those
who will ultimately use them, let them respond and tell you how
it is functioning and what it needs and the like, really seems
to me to be thinking that might have applied a long time ago
when technology was moving at a much slower pace.
Mr. Sullivan. Well, and that is ``fly before you buy'' is
kind of the term that they use for that. But when you have
requirements that are so demanding with such immature
technologies and you start a program before you understand
that, the development program will really be at a loss for a
long time. There is going to be a lot of churn as you wait for
those technologies to mature. In some cases, we are talking
about technologies that were just concepts. They did not even
have a component for the technology----
Senator Durbin. So, Dr. Gilmore, how would you address that
part of it, this ``fly before you buy'' versus concurrency?
Dr. Gilmore. There is always going to be a certain amount
of concurrency in the programs, as Mr. Kendall mentioned. This
was an extreme case that I think he accurately characterized as
acquisition malpractice.
But to get back to the question you asked about what caused
this to happen, I guess I have a little bit different
perspective than Mr. Sullivan. I actually think it is pretty
simple. The Department has a long history of deceiving itself
early on in programs about their costs, schedule, and
difficulty. In this particular case, there were a number of
assumptions that were made, for example, that there would be
high commonality in the structural parts among the various
aircraft. That not surprisingly over time--and I was a career
person in the Department when the program started, and there
were plenty of people who were indicating warnings at the time
that, well, you know, you are making some unrealistic
assumptions here about commonality in order to drive the unit
cost down in the analyses that you are doing, because at that
point everything was just on paper and was being done by
analysis. And, of course, those assumptions on commonality
turned out to be unrealistic.
But those kinds of unrealistic assumptions, which then
carried through into the program when it decided to start
production without any flight test--you know, one of the
assumptions at that point was that the modeling and simulation,
the structural modeling and simulation, the modeling and
simulation of fusion capabilities and of how the sensors would
respond and so forth and so on, was going to be so exquisite
that there would be no surprises in the flight test program.
And, of course, that has turned out not to be the case.
And I would point out in the flight test program up to this
point, we have not actually tested any combat capability. We
have tested the handling characteristics of the aircraft. We
have done necessary precursors to testing actual combat
capability. But the first time we will be flight testing combat
capability is in Block 2B. When we finally get the Block 2B
software released to the test program, then we will be flight
testing some actual combat capability, although it will be
limited and we will have to wait till Block 3F.
So my perspective is that what happened here is,
unfortunately, at the onset of the program back in the 1990s
was what happens frequently, and that is that everyone got
together in the Department and basically deceived themselves
about how hard the job was going to be and how expensive it was
going to be. And then reality intruded, and reality always
wins.
Senator Durbin. You used the word ``deception.'' We heard
the word ``optimism'' before. It seems like they brought us to
the same place.
Mr. O'Hanlon, just briefly. I looked at this, too, from the
viewpoint of America's industrial base, our capacity to build
what we need next, our capacity to sustain this innovation,
creative spirit, and keep it in a safe place so that we can
really entrust to the people who are doing it our national
security, which in the last week or two has again been brought
into question.
How do you view this in terms of what we should have done
with F-35 and what we may need in the future and whether we
would be ready for it?
Mr. O'Hanlon. I guess, Senator, one observation I would
have is that I do not want to depend too much on just one
company or just one airplane. And it goes back to your point
about ``too big to fail.''
I think Lockheed has done, generally, a good job, and
Lockheed is making a wonderful F-16 still, which is part of the
airplane in my alternative. I want to make more F-16s for the
United States. We are making them primarily or exclusively now,
I think, for foreign customers. So I have nothing against
Lockheed, but I do think the idea of having more than one
airplane, more than one modern airplane in the works is a good
one. And part of the alternative, therefore, that I propose is
to focus on this X-47, this naval unmanned, carrier capable
plane that is getting some attention, some resources right now,
but the service's commitment to it, the Navy's commitment, is
probably a little bit shaky partly because their budget is so
overstressed by the F-35. And so one of the lessons I would
draw is make sure you have a couple or three things in the
works when it comes to something as important as combat
aircraft.
Senator Durbin. Senator Cochran.
Senator Cochran. Mr. Sullivan, Government Accountability
Office (GAO) has noted the improved performance and outlook for
the F-35 program but continues to identify long-term
affordability as a major concern. What work are you doing to
identify savings in the projected cost to sustain the F-35 once
it is fielded?
Mr. Sullivan. Well, right now, as has been stated earlier,
the operations and support (O&S) costs--you are referring to
the lifecycle costs, the sustainment cost. We are reviewing
what the Program Office has now in this review that we are
undertaking right now, and in addition to that, we are talking
with the Cost Assessment and Program Evaluation group, known as
CAPE, in the Department to see what kind of assumptions they
are using to determine future O&S costs and what targets they
are using to try to reduce those. So we, more or less, are
relying on the initial data that they are providing us and
reviewing that.
Senator Cochran. What do you believe are the key factors
that must be achieved for the program to meet affordability
targets?
Mr. Sullivan. Reduction of the O&S costs would be number
one, and I think the things that they have to look at--the
first panel discussed a lot of efforts. Reliability on the
aircraft is very critical to sustainment, and right now, they
are not quite meeting their reliability targets that they were
supposed to achieve at this point in the program. And in fact,
they are about halfway to achieving the kind of reliability
growth that they have to do on the aircraft. So I think Mr.
Kendall pointed out that is one of his top concerns, and I
would agree with him on that.
In addition, they need to look at fuel costs. They need to
look at how they man the aircraft, how they train. You know, I
think General Bogdan said that when you do the concept of
operations on this, you have to pay a lot of attention to how
much time you are going to fly the aircraft, things like that.
Senator Cochran. What is your current assessment of the F-
35 manufacturing process?
Mr. Sullivan. Right now, last year when we visited--we
actually toured the process last year, and we gathered data on
a number of different things that indicate manufacturing, like
efficiency rates, the labor hours that they take to deliver
aircraft, the span times between deliveries. And in every case,
even in the engineering changes that are the result of
concurrency, the program looks like it is trending in an
improved way, and we would like to see that continue. We think
probably it will. They have worked through about 40 percent of
the flight tests. So they understand the flight envelope, and
most of those design changes are probably behind them. So we
think that the manufacturing processes will continue to
improve.
Senator Cochran. Comparing this process with others, how is
it similar or not in the various stages of development and
production?
Mr. Sullivan. The manufacturing process?
Senator Cochran. Yes.
Mr. Sullivan. Well, the first thing about this one that is
unique to most every manufacturing process I have looked at is
the fact that they have three variants going through final
assembly on the same line. So it is more complex in that
regard. And I think they have done a pretty good job of working
that out.
Other than that, on the major acquisitions I have looked
at--F-22 was one of those, B-2 bomber, and some other ones--it
is very similar in that the concurrency on the program causes--
I would say that concurrency between flight testing and
production--it does have a cost of design changes that you have
to go back and retrofit aircraft on, but in addition to that,
it creates an awful lot of chaos on the manufacturing floor. I
do not know how you capture those costs of concurrency, but
this program probably has been much less efficient than it
could be if it were less concurrent.
Senator Cochran. Thank you, Mr. Chairman.
Senator Durbin. Senator Shelby.
Senator Shelby. Thank you.
Dr. Gilmore, you have a very important job. You are the
Director of Operational Test and Evaluation at DOD, and you
have talked about the plane today.
Modeling and simulation are very important, as far as not
just planes but anything else that comes along. Is there any
real substitute once you pass that for testing and evaluation
once you get into that?
Dr. Gilmore. Senator, we use modeling and simulation in
numerous operational test activities because we have no choice.
In the particular case of Joint Strike Fighter, it is currently
under development. It is an analog to what is currently called
the air combat simulator down in Marietta that was used during
F-22 operational testing, and it is being used for all the
follow-on development that is being done to improve the
capabilities of the F-22 where you have a full-up effect space
simulation of the aircraft and you can take operational pilots
into the simulator and have them fly the aircraft as
realistically as you can in a simulator.
We are going to be doing the same thing with the Joint
Strike Fighter. However, those simulations must be rigorously
verified, validated, and accredited based on open air flight
test data. If they are not, then they are meaningless. So there
is----
Senator Shelby. You are fooling yourself if they are not,
are you not?
Dr. Gilmore. Pardon me?
Senator Shelby. You are fooling yourself if they are not
real evaluative tests.
Dr. Gilmore. Correct. And so we are pushing the flight test
program to give us the data to verify, validate, and accredit
rigorously what is called the verification simulation for the
Joint Strike Fighter, which is under development. There will be
a version that is used in developmental tests and an even more
capable version that is used in operational tests.
But again, we must get data out on the open air test
ranges, the western test range, where they are doing
developmental testing and where we will be doing the open air
operational testing, which will take a year, to validate that
model. We can only do, even in that year, a relatively small
number of open air sorties under limited conditions.
For example, we will not, on the open air test ranges, be
able to fly the aircraft against the dense integrated air
defense systems that actually the aircraft is being designed to
be able to penetrate on the first day of war. But we can fly
against selected air defense assets and take that data, use it
to verification, validation, and accreditation (VV&A) the
simulations, and then in the simulations, fly against the
simulated, very dense integrated air defense systems. And then
we can also do many more simulated flights in the simulator
than we can open air, thereby getting a statistically
significant sample of data. But the linchpin for all of that is
the VV&A from the actual open air flight test data. If we do
not have those data, then the simulation, as you point out, is
not meaningful.
Senator Shelby. You have to have it.
Mr. Sullivan, how do we get the cost down? Is it, as we
call it, economy of scale? Mr. O'Hanlon was talking about
recommending half the purchase, whereas most people who deal
with economics as a rule--the more you make, the price comes
down. I mean, I think that is just basic. Explain your views.
Mr. Sullivan. Well, if you are talking about total program
cost, you can reduce the total amount of expenditure in
procurement by reducing the quantities, but each one you buy is
going to cost more. So there is a difference, you know, looking
at the unit cost and the overall total program cost.
For example, on the F-22 program, the F-22 program roughly
estimated that it would cost about $70 billion to develop and
procure 750 aircraft. They started cutting costs on that by
reducing aircraft. They wound up with about 180 aircraft for
$70 billion. So the cost of the program did not go up, but the
cost of each aircraft did.
You know, that is the one way to save budget on this
program, and this is a program that is going to cost, if you
just look at acquisition costs, as I said in my statement, over
$12 billion a year for the next 25 years. You can try to get
efficiencies, and I am sure they are going to continue to drive
the learning curve down, but in the end, this happens with most
programs. You have to start reducing quantities.
Senator Shelby. This is not new, as was brought up earlier.
This is not new to probably any development of a weapons system
we have seen over the years.
Mr. Sullivan. The B-2 bomber was supposed to be 132
aircraft. They wound up 20 tanks, same thing. It is part of
this legendary death cycle that you hear about on acquisition
programs where too much is promised. They cannot budget for all
of it. They have trouble meeting the requirements, and
eventually they are spending too much money and they cannot buy
as much.
Senator Shelby. Mr. Sullivan, do you believe that more
competition in the acquisition process will help solve some of
the structural problems that we have had?
Mr. Sullivan. I think more competition always results in
not only a better price, but better responsiveness. You know,
this is a sole source engine, as well as aircraft. So there is
not going to be any competition in the engine here either, and
we have seen in the past where when you have competition at
that level, you get reduced costs and better responsiveness
from the industrial base.
Senator Shelby. We had some votes on that, did we not?
Mr. Sullivan. Yes, we did.
When you are talking about a fighter like this, it is
pretty hard to have competition with something this complex,
but you can maintain competition in some cases longer than at
the start of the program. Sometimes you should think more about
competing up to a critical design review, for example, you
know, when you have a stable design, things like that.
Senator Shelby. Mr. O'Hanlon, you mentioned the F-16, which
we know is a good plane. Of course, it had a few bumps along
the road too. But that is a current generation of plane, a
great one. It has been. But technology moves on either with us
or with our would-be adversaries. Have you considered that in
your recommendation?
Mr. O'Hanlon. Yes, Senator.
And by the way, I also agree with your earlier point, even
though you might not have guessed that I would, because I think
you have to factor this in. If you are going to have a smaller
buy and try to construct a portfolio of airplanes that winds up
purportedly being cheaper, you have to factor in a higher unit
cost as part of the calculation. And I have acknowledged that
in my work. But that is part of why, even though I am proposing
a much smaller F-35 program, the savings are nothing close to
50 percent. And so, again, that is an important thing to bear
in mind.
And by the way, a compromise idea here could be keep trying
to see if the F-35 cost curve comes down the way that Lockheed
Martin hopes it will. If it does, then maybe you discard my
backup plan in a couple of years, and if it does not, then you
keep that in mind.
In terms of capability, Senator, your last question, what I
tried to do when I sized my alternative was to say let me
imagine, even though I am fairly hopeful on U.S.-China
relations, that they do not go well for a number of years and
we wind up with a number of bases in Southeast Asia, including
some we do not even have now, that might be needed to carry out
some kind of a containment policy, which is not our current
policy, as you know, and I hope it will never have to be. But
let us imagine it might. So I think about bases in the
Philippines, bases in Vietnam, ongoing capability in Okinawa
and other parts of Japan, Guam, maybe even Taiwan itself if
there has been a Chinese attack.
Senator Shelby. Korea.
Mr. O'Hanlon. And Korea.
And if I do that and I imagine, let us say, up to a couple
of wings in each of those places, then I get up to the kind of
numbers that I am proposing. So it is a threat-based approach,
and it is a fairly rigorous one in that regard. It is just not
populating the entire force structure with F-35s.
Senator Shelby. I will pose this last question. The
chairman has been generous with me. My last question: Is it not
important to this country and the decisions we make right here
on funding or not funding things that will make this country
secure to not just think about tomorrow--I mean, 2 years from
now but 10 years from now, 15 years from now when we are
building weapons systems and acquiring them for the future. And
we look around the world--I mean, I hope we stay in peace
always, but we realize that China has become a huge economic
power. Following that throughout history there has been a build
up of military strength and a possible notion of establishing
some kind of a hegemony in that area. Does that concern all of
you when we are thinking about weapons not just for today but
for tomorrow?
Mr. O'Hanlon. I can give a one-sentence answer to get out
of the way. That is why I am ultimately a strong supporter of
the F-35. So we are talking about the numbers. But in terms of
the capability, especially in the western Pacific, I think it
is quite important.
Dr. Gilmore. Senator, I would say that I agree with Frank
Kendall and the service chiefs. I do not think we have an
alternative but to develop this plane and make it work.
My caution is just that at this point anyone who projects
when we will have certain capabilities is probably being a bit
optimistic based on what I have seen so far in the program. And
again, it has improved its performance substantially, but
still, these are very complex undertakings. I easily see a 6-
to 12-month slip relative to what the program schedule is now.
But that is a marked improvement from where we were in 2009.
And so it is going to take a while to get this capability. It
has taken a while to get all the capabilities in the F-22 that
we wanted. In fact, we are still working on that. That has
turned out to be a very capable aircraft, but it was also a
program that was rather troubled and went through some of the
same troubles that this one is going through. I agree that it
is needed. But go ahead.
Senator Shelby. Mr. Sullivan.
Mr. Sullivan. Yes, I think that the acquisition process for
major weapons system acquisitions that the Department uses is
broken in that when they set requirements for big bang, quantum
leap kind of capabilities--you know, they project that they
will take 10 years and they wind up taking 15. The world
changes dramatically, as the chairman pointed out, in 15 years.
So one of the things we have looked at is that you need an
acquisition process that can deliver much more quickly and be a
lot more agile and maybe have incremental improvements to
requirements so you can deliver added capability, maybe not the
big bang, but in the next block maybe you get there.
The commercial world operates that way, and they make
pretty good revolutions incrementally over a 10-year period. If
you look at some products and look at how long it takes for a
weapons system to deliver anything, there is an awful lot of
electronics and things out there that just deliver, deliver,
you know, it is an incremental kind of an approach. And you are
in production a lot more than you are in development that way
too.
So that would be a major change in the acquisition process
to be able to look at a 5-year kind of production capability
but maintain the vibrant tech base that we need. Right now, the
acquisition process--it is not only concurrency between testing
and production. It is also concurrency between technology
development and product development, and that gets very
inefficient.
Senator Shelby. Mr. Chairman, thank you.
Senator Durbin. Thank you very much, Senator Shelby and
Senator Cochran.
I want to thank the staff for their preparations in this
hearing and the panel for their valuable testimony, along with
the first panel.
When I took over as chairman of this subcommittee, I knew I
had a lot to learn, and this was one of the hearings that I
asked for. This is the most expensive acquisition project
underway. We are making sacrifices in the name of deficit
reduction that relate to the number of troops, the training of
our troops, suggested base closures, perhaps not equipping our
Guard and Reserve units the way they need to be equipped,
having just relied on them so much in the conflicts in Iraq and
Afghanistan. Over and over again, we are being asked to make
some hard decisions in the subcommittee, and I did not want the
acquisition process to be separate from that conversation. And
I wanted to start with the obvious big dog on the block, the F-
35.

ADDITIONAL COMMITTEE QUESTIONS

Your point, Mr. Sullivan, at the end is one I tried to make
earlier and just keep returning to. When people sit down in my
office and say, well, we started thinking about 12 years ago
about battlefield communications and what our troops will need,
we are still working on it, and I am thinking, my goodness,
what has changed in this world in terms of communications in 12
years. And it is a challenge for us, a challenge we have to
meet.
[The following questions were not asked at the hearing, but
were submitted to the Department for response subsequent to the
hearing:]

Questions Submitted to Hon. Frank Kendall, III
Questions Submitted by Senator Patrick J. Leahy

Question. Senator Reed asked you about the security of the F-35
from cyber threats, and your response indicated that you took it as a
question about industrial espionage and the theft of F-35 design
secrets by near peer powers.
Leaving aside the question of industrial espionage, given that the
F-35 is the most software- and information technology-enabled aircraft
in our Nation's history, what are your plans to protect it from
operational cyber security threats? During the hearing General Bogdan
called the jet ``virtually a flying computer.''
Answer. As Lieutenant General Bogdan indicated, the F-35 is
remarkable in its extensive computer processing power and can be
depicted as a ``flying computer.'' As such, the F-35 aircraft, as well
as its ground components, are monitored and managed like other
Department of Defense (DOD) high-value computer networks and systems.
U.S. Cyber Command, as well as other agencies, monitors emerging
threats to DOD computer systems and issues warnings and alerts. The F-
35 Joint Program Office (JPO) receives these warnings and alerts,
develops appropriate patches and upgrades to the air system to counter
the threat, and integrates those into the mission system and ground
support software.
Likewise, the F-35 JPO, in concert with other security agencies,
takes great care to analyze the persistent long-term threats to the F-
35 air system and takes corrective actions when appropriate.
Question. It is not science fiction to imagine an enemy of the
United States would seek to hack into and disable our fleet of F-35s.
And the jet's information technology means that they have an avenue to
do so.
You recently issued a DOD Instruction about assured
microelectronics. How do you plan to assure the microelectronics and
networked functionality of the F-35 from operational cyber attack? What
is your trusted electronics plan for the F-35, and how will you protect
that plan from downward budgetary pressures?
Answer. We issued DOD Instruction 5200.44, ``Protection of Mission
Critical Functions to Achieve Trusted Systems and Networks (TSN)'' to
ensure that all DOD programs apply risk management practices throughout
the product lifecycle to minimize the risks mentioned above. The F-35
Joint Program Office (JPO) is also working closely with the Office of
the Deputy Assistant Secretary of Defense for Systems Engineering to
address all Program Protection Plan (PPP) elements to include
criticality analysis, identification of Critical Program Information
(CPI), and Supply Chain Risk Management (SCRM). The PPP is a living
document, and the F-35 JPO is periodically updating the PPP and
integrating a revised CPI and critical component list over the F-35
program lifecycle.
A primary concern with regard to a cyber attack on a platform like
the F-35 is that mission capability would be impaired as a result of
vulnerabilities in system design or subversion within the supply chain
that affects a system's mission critical functions or critical
components. The F-35 program has worked diligently to reduce
vulnerabilities in the system design through sound system security
engineering and through implementation of DOD 8500.2, JAFAN 6/3, and
Telecommunications Electronics Material Protected from Emanating
Spurious Transmissions (TEMPEST) requirements into the air system. The
program utilizes Information System Security Engineering Working Groups
(ISSEWG) and Technical Interchange Meetings (TIM) as regular forums to
address, discuss, and resolve system security engineering concerns/
topics relating to system design. The outputs of these discussions are
used to guide program design changes and/or system security
architecture improvements.
With regard to detecting, reducing and mitigating the consequences
of products containing counterfeit components or malicious functions,
the F-35 program has taken some proactive actions. First, all Lockheed
Martin's (LM) suppliers are contractually required to comply with the
best practices outlined in key Aerospace Standards AS-5553 and AS-6174,
which while not a panacea, does provide a risk assessment framework for
identifying potential problem areas and ensuring a full understanding
of the specific risks. The F-35 JPO has further stipulated that as part
of LM's Seller Plan, a Seller shall only purchase products directly
from the Original Component or Equipment Manufacturer (OCM/OEM) or from
an OCM/OEM authorized distributor chain, Aftermarket Manufacturer, or
Authorized Reseller. In the few instances where items need to be
purchased from independent distributors or brokers such as in cases of
diminishing material supply (DMS) or obsolescence, the parts will be
subjected to a screening process appropriate to the commodity as
documented in the Program Counterfeit Parts/Material Prevention and
Control Plan. On a recurring basis, Lockheed Martin Supplier Quality
Management personnel will audit the suppliers' counterfeit parts
prevention and as further mitigation, the F-35 suppliers are required
to mask the intended use of the parts or components for use on the F-35
program.
In dealing with potential vulnerabilities within custom or
commodity hardware/software, the F-35 program is taking some
significant steps to mitigate those threats. We currently require
compliance to Aerospace Standard 9120 which requires traceability of
parts from receipt until delivery, as well as evidence of conformance
to ensure the part has been rigorously tested and the likelihood of it
being a counterfeit is minimized. For various components on the
aircraft that are customized for F-35 uses, such as Application
Specific Integrated Circuit (ASIC) components, the program is
investigating the use of a Trusted Foundry for procuring those
components.
Additionally, the program has been in discussions with the Defense
Microelectronics Activity to investigate the potential sourcing of
other components currently procured overseas from Trusted Domestic
Sources. The current criticality analysis underway and the resulting
vulnerability assessment outcome will influence the JPOs' risk
assessment and decision whether to pursue that route. The outcome of
the vulnerability assessment will also influence future decisions
(Block Upgrades, Tech Refreshes and DMS Redesigns) to design vulnerable
components out of the system.
Funding availability in a shrinking budget environment provides
challenges to maintaining the current plan. The Department is dedicated
to ensuring secure and effective microelectronics and networked
functionality and will continue to prioritize these areas. The
expanding and increasingly competitive Trusted Supplier network should
provide an avenue to mitigate threats while lessoning budget pressures.
Question. ``To start over, to go back 10 years, 20 years and invest
$20 billion or $30 billion in the development of another aircraft in
replacement of the F-35 just doesn't make any sense.''
I agree. However, are there any plans to diversify the fighter
fleet in line with alternative proposals, such as those made by Michael
O'Hanlon of the second panel of witnesses?
Answer. Currently there are no plans to diversify the Department's
Tactical Strike Fighter (TACAIR) fleet in line with any alternative
proposals. The Department's TACAIR priority is to acquire 5th
generation fighter/attack aircraft as quickly and efficiently as
practical, while maintaining sufficient legacy aircraft inventory to
meet current and near-term commitments. Legacy fighter/attack aircraft
are important today, as evidenced by their involvement in ongoing
operations in Afghanistan. However, the 4th generation aircraft are
limited in their ability to combat adversaries employing Anti-Access
and Area Denial threats. The Department is committed to transitioning
to 5th generation capability and the F-35 will constitute the bulk of
that inventory.
Question. Please explain how the cost of the F-35 program will not
deprive the military of vital modernization in other areas.
Answer. Every element of the Department's budget represents an
attempt to balance all the competing needs of the Department, the F-35
program is no exception.
To that end, F-35 production costs are coming down. Unit costs
continue to go down with each successive production lot we have on
contract. The Low Rate Initial Production (LRIP) Lot 5 contract was 4
percent lower than the LRIP Lot 4 contract. We expect that trend to
continue provided we can ramp up to more economical production rates.
These cost reductions are a result of an aggressive transition to fixed
price-type contracts and agreements with the contractor that more
equitably share in the risks associated with concurrency and overruns.
The LRIP Lot 6 and 7 contracts will place the entire burden for any
overruns on the contractor.
We are actively pursuing opportunities to reduce the long-term
lifecycle costs as well. The Department, F-35 Program Office, and
Services are reviewing increased opportunities for competitive
sustainment in the areas of global supply chain, support equipment, and
training. Additionally, sustainment business case analyses are
assessing the appropriate mix of contractor and government maintenance
and support to find the most cost effective way to reduce Operations
and Support (O&S) costs. The F-35 Program Office estimate for O&S costs
has come down in the last year, and the Department's independent
estimate will be updated later this year.
Finally, the multirole F-35 is the cornerstone of the Department's
future air dominance and precision attack capabilities. The F-35 will
replace numerous aging legacy aircraft for the Air Force, Navy, and
Marine Corps. The capabilities that the F-35 will bring to the
warfighter are absolutely required to meet the projected threats in the
future, and worth the investment required to modernize the fleet. My
focus is to ensure that we deliver the required capability at the right
cost.
______

Questions Submitted to Admiral Jonathan W. Greenert
Questions Submitted by Senator Jack Reed

Question. Will you have to modify existing carriers to accommodate
the F-35 (e.g. arrested landing gear, catapults, elevators)? If so, how
much will this cost, has any of this work begun in the planning stage,
and when do you expect this work will have to be funded?
Answer. The current modernization plan for Nimitz-class carriers
includes 16 separate ship alterations designed for integration of the
F-35C. Nine of the 16 modifications have been developed while the
remaining alterations are in varying stages of development, but will be
complete in time to support Initial Operational Capability (IOC) for
the F-35C. A number of the identified ship modifications are designed
specifically for F-35C compatibility, and others will both enable F-35
sea-basing and improve support for the rest of the aircraft in the
carrier air wing, including the E-2 Hawkeye, F/A-18 Hornet and Super
Hornet, EA-18 Growler, and the Unmanned Carrier Launched Airborne
Surveillance and Strike (UCLASS) system.
USS Abraham Lincoln (CVN 72) will be the first carrier to be ``JSF-
Ready.'' She will receive all 16 alterations, either as part of her
current Refueling Complex Overhaul (RCOH), or in future planned
incremental availabilities or modernization periods. The total cost of
all 16 modifications for CVN 72 is estimated to be $53 million. The
alterations for the remaining Nimitz-class carriers are expected to be
similar in cost, and will be incrementally-funded between now and
fiscal year 2022 to meet F-35C deployment schedules.
The nine ship alterations already fully developed are incorporated
into the baseline design of Gerald R. Ford (CVN 78), the lead ship of
the Ford class of carriers. The remaining seven modifications are
planned for installation after CVN 78 has been delivered to the Navy.
Question. With respect to CVN-78 USS Gerald R. Ford--is the new
Electromagnetic Aircraft Landing System (EMALS) being designed to
accept both F-18s and F-35s? Is the EMALS system being tested with the
F-35C and F-18s?
Answer. EMALS is being designed to launch all air wing aircraft,
including F-35C and all variants of the F/A-18. Aircraft Compatibility
Testing completed to date included the F-35C, F/A-18E, T-45C, C-2A, and
E-2D. Additional testing will include all variants of the F/A-18.
______

Questions Submitted by Senator Roy Blunt

Question. What is the total lifecycle cost to operate and sustain
the F-35C program, and do you believe these costs are sustainable?
Answer. OSD CAPE has estimated operating and sustainment (O&S) cost
for the entire F-35 program at $671 billion (fiscal year 2012). This
O&S estimate is for all three United States variants based on an
estimated 30-year service life and predicted attrition and usage rates.
The F-35C estimate is approximately 15-18 percent of the total DOD F-35
O&S cost estimate. The estimate will be updated for the annual Defense
Acquisition Board review of the F-35 program.
The program continues to make progress toward reducing sustainment
costs. The Services continue to support the F-35 Joint Program Office
(JPO) in its disciplined approach to analyzing and reducing sustainment
costs.
Question. The recently released Select Acquisition Report (SAR)
estimated the cost per flying hour of the F-35A, the conventional
aircraft, to be approximately $32,000 per hour. Costs were not provided
for the F-35C, the Navy variant. Will the harsh carrier environment in
which these aircraft operate increase the cost per flight hour above
the AF variant?
Answer. Concurrent with F-35A cost estimation, several F-35C cost
per flight hour estimates have been developed by the Joint Program
Office. F-35C costs are projected to be about 3 percent higher or about
$1,000 more per hour.
Factors causing the higher cost per hour are due to increased
complexity required to operate in the carrier environment. The F-35C is
substantially different in aircraft structure than the F-35A. Among the
changes, the F-35C has a significantly larger wing area, 620 square
feet, compared to 460 square feet for the F-35A. This larger wing poses
higher costs to repair and maintain due to material costs and higher
low observable maintenance manpower requirements. The F-35C has a
folding wing, which is more complex, more expensive, and adds to repair
cost. The F-35C requires reinforced landing gear and a tailhook to
accommodate carrier landings and landing loads. Tire and wheel
replacement will also be more frequent and more expensive.
Question. Do you have an estimate of the cost per flight hour of
the F-35C at initial Operational Capability (IOC)?
Answer. Based on the current F-35 schedule, the F-35C will reach
the IOC milestone between August 2018 (objective) and February 2019
(threshold). The F-35 Joint Program Office (JPO) and Department of the
Navy (DON) continue to develop estimates for the F-35 cost per flight
hour. Estimates for cost per flight hour at IOC are not available.
However, at maturity, the F-35C cost per flight hour is estimated to be
approximately $33,000.
Question. Can you compare the cost per flight hour of the F-35C at
initial Operational Capability with the cost of the current fleet,
which I understand has the lowest per hour in the Navy inventory?
Answer. At maturity, which is defined as operations with the peak
number of aircraft in service, the F-35C total operating and support
costs, less indirect costs, are estimated to be approximately $33,000
per hour compared to approximately $20,000 for the F/A-18E/F. This F-
35C cost is a projected estimate, whereas the F/A-18E/F figure is an
actual, observed cost. The F/A-18E/F program has significantly
benefited from F/A-18A-D Fleet operational experience and numerous
initiatives to reduce its sustainment costs. The Navy and the Joint
Strike Fighter Joint Program Office remain committed to identifying
efficiencies to reduce sustainment costs for the F-35C.
Question. I applaud the Navy for investing in additional airborne
electronic attack capability this year to overcome our adversaries'
evolving capabilities, particularly because we are investing in stealth
technology that may already be vulnerable to new radars and weapons
systems. Our adversaries are getting much better at detecting and
countering stealth technology with new capabilities. One of the ways to
overcome these technology improvements includes airborne electric
attack. Can you discuss the importance of this capability?
Answer. Future conflicts will be fought and won in the
electromagnetic spectrum and cyberspace, which are converging to become
one continuous environment. This environment is increasingly important
to defeating threats to access, since through it we can disrupt
adversary sensors, command and control and weapons homing.
It is important to make investments that will allow us to shape the
electromagnetic (EM) spectrum to our advantage. For more than a half
century the Department of the Navy has been the leader in Airborne
Electronic Attack and this naval capability remains in high demand.
This is why the Navy has invested in airborne electronic attack systems
such as the EA-18G Growler and the Next Generation Jammer. The Next
Generation Jammer will operate over a wider frequency range and have
greater flexibility than today's airborne jammers because of its
digital processing and tunable antennae. This capability will allow it
to do much more than jam enemy sensors; the Next Generation Jammer will
be able to deceive, decoy, and inject false signals into enemy sensors.
These are all ways we need to employ the spectrum to our advantage.
Future investments will continue to leverage our airborne
electronic attack capability as part of a fully netted warfare concept,
which will provide EM spectrum dominance by merging EM spectrum
capabilities with cyberspace.
Question. You've been a thoughtful leader in exploring affordable
alternatives to meet advancing threats. For example, you've discussed
the importance of keeping today's aircraft platforms lethal by
upgrading their payloads, such as stand-off weapons and sensors. Can
these types of advanced payloads on current platforms serve as
affordable alternatives while still maintaining a qualitative edge over
our adversaries?
Answer. Upgrading payloads for existing platforms offers a rapid
and cost-effective way to improve or integrate new capabilities into
proven platforms. Aircraft naturally lend themselves to a payload focus
because they are designed with hard points and junctions into which a
number of modular payloads can be connected. We also need a deliberate,
comprehensive, and effective process to design advanced platforms to
recapitalize existing ships and aircraft. The key in designing new
platforms is to control their cost and incorporate the space, weight,
power, and cooling margin needed to host a range of new platforms over
its life. Payloads extend the effectiveness of platforms and are an
important part of the mix in balancing capability and capacity.
Upgrading current aircraft enables us to maintain a qualitative
edge, while developing and producing new aircraft allows the Navy to
provide the necessary capabilities in the future. A complementary mix
of upgraded F/A-18E/F and future F-35C squadrons will provide the air
wing the proper balance of capability, responsiveness and affordability
across the spectrum of military operations. Both F/A-18 E/F and F-35C
carry or will carry a wide range of payloads and Navy will continue to
develop and expand additional payload capability to pace threat
development.
______

Questions Submitted to General Mark A. Welsh, III
Questions Submitted by Senator Patrick J. Leahy

Question. In your comments to the committee, you stated, ``. . . we
need to determine when do we need [the F-35], how much of it do we
need, and then how do we mix it with a fourth generation capability
that we will have in our fleet for years?''
Answer. The Air Force remains committed to the F-35, but budget
reductions are forcing the Air Force to seek a balance between
investing in new aircraft and sustaining/modernizing our aging fighter
fleet. Under any reasonable forecast, the Air Force will continue to
field a mix of 4th and 5th generation fighters for the next two
decades; however, as long as potential adversaries pursue advanced
threats to our fighter forces we see no alternative to the F-35. The
fiscal year 2014 President's budget, as submitted, funds F-35
procurement and legacy fighter modernization to include F-16 service
life extensions. However, under sequestration budget levels, some 4th
generation modernization programs will have to be slowed or terminated.
Question. Does this statement signal any lessening of the Air
Force's commitment to the F-35 in the future? Specifically, do you
intend to service-life extend F-16s beyond their current sunset date,
or to maintain a future Air Force that will fly both F-35s and F-16s
for the foreseeable future?
Answer. The Air Force remains committed to the F-35, but budget
reductions are forcing the Air Force to seek a balance between
investing in new aircraft and sustaining/modernizing our aging fighter
fleet. Under any reasonable forecast, the Air Force will continue to
field a mix of 4th and 5th generation fighters for the next two
decades; however, as long as potential adversaries pursue advanced
threats to our fighter forces we see no alternative to the F-35. The
fiscal year 2014 President's budget, as submitted, funds F-35
procurement and legacy fighter modernization to include F-16 service
life extensions. However, under sequestration budget levels, some 4th
generation modernization programs will have to be slowed or terminated.
Question. During the hearing, you mentioned that ``. . . [F-35s]
can't fly within 25 miles of lightning. They can't fly in the weather
yet. That's going to require software development that's due and is on
track to be delivered. By the time we reach our initial operational
capabilities at the end of 2016 for the Air Force, those problems will
be in the past.''
These are clearly major operational deficiencies. What other
capability gaps do you perceive in the aircraft that will be resolved
by future block updates to software or hardware? When do you anticipate
they will be resolved? What capability gaps will never be resolved by
future engineering changes?
Answer. The F-35 development program delivers incremental
capability through hardware and software block upgrades. Initial
operational capability for the Air Force includes basic close air
support (CAS), Air Interdiction, and limited Suppression and
Destruction of Enemy Air Defense (SEAD/DEAD) operations in a contested
environment. The Joint Program Office conducted a Critical Design
Review for the final capability block on 25-27 June. Based on the
current program schedule, the F-35 Joint Program Office is moderately
confident the F-35A will meet those capabilities by the initial
operational capability date in 2016. The final block of capability in
the F-35 System Development and Demonstration program is anticipated
for August 2017. It is expected to include full warfighting capability,
including close air support, Air Interdiction and Strategic Attack,
SEAD/DEAD, Offensive and Defensive Counter Air, with an expanded flight
envelope and array of weapons.
Question. What air forces and what defense systems is the F-35
designed to counter? What planes will those countries fly in opposition
to the F-35? In what ways is the F-35 superior to those planes?
Answer. Countries like Russia and China continue to make tremendous
leaps in the technology and capability within their own air forces.
Fighters, such as the SU-30 and SU-35, are equipped with improved
targeting systems, cutting edge electronic jammers, and advanced air-
to-air weapons. These aircraft are on par to our own legacy fleet and
are already deployed in significant numbers. These fighters are offered
for sale worldwide to any potential adversary. The SU-35 was ``center
stage'' at this year's Paris Air Show, marketed as the counter to
America's air superiority advantage.
Russia and China are also developing their own fifth generation
fighters such as the PAK-FA, J-20, and J-31. With improved aerodynamic
performance, reduced radar cross sections (i.e., ``stealth''),
sophisticated digital radar systems, and networked targeting solutions,
these aircraft are designed to challenge our F-22 and F-35 for control
of the skies.
The F-35, however, will hold the advantage against these advanced
fighter threats. Its fifth generation capabilities in stealth,
electronic attack and protection, combined with a networked and sensor
fused targeting solution, ensure our F-35s will ``see first, shoot
first, kill first'' in any future air-to-air conflict. Details on these
capability advantages are classified, but can be provided upon request.
Question. What air defense systems and equipment will the F-35 be
expected to attack, and is it capable of doing that job? How vulnerable
is the F-35 to surface-to-air missiles? Which radar systems now
manufactured, installed and exported by Russia, by China, and by other
countries are incapable of detecting the F-35?
Answer. The F-35, with its fifth generation capabilities of
advanced stealth, improved electronic attack and protection, and fused
and networked sensors for enhanced situational awareness, achieves
unmatched levels of survivability and lethality against the most
advanced integrated air defense systems. Because of this, the Air Force
expects to employ the F-35 in the most challenging threat environments;
areas our current legacy fleet simply cannot operate in and survive.
This allows the Air Force to hold the enemy's most defended targets at
risk, while we maintain the ability to protect the U.S. military
personnel in the air and on the ground.
When the F-35 is fielded in the Block 3F configuration, it will
have the full complement of capabilities and weapons needed to ensure
mission success in the most contested, anti-access and area denied
environment. The Air Force fully expects it will perform superbly in
the role of suppression and destruction of enemy air defenses and it
will ensure our air advantage in any potential future conflict.
Details on the F-35's performance against specific adversary radar
systems are classified, but can be provided upon request. However, in
general terms, the F-35's fifth generation capabilities of improved
stealth, advanced electronic attack and protection, and fused and
networked sensors will ensure it can detect, target, track, and destroy
the most advanced air defense systems that Russia or China are fielding
or exporting well before they can detect and target the F-35 in return.
Stealth and signal management are not just ``magic paint'' we add
to an airplane to make it invisible to an enemy's radar. It is a
combination of inherent design features including aircraft shape,
internal weapons and fuel, and special coatings, designed to
significantly reduce the radar energy return coming from the F-35. When
used in combination, these design features provide the reduced radar
cross section needed to reduce the adversary's ability to detect and
engage the F-35, providing the freedom of movement needed to hold
targets at risk in these heavily defended environments. Without them,
as is the case for our legacy fourth generation fleet, we simply cannot
survive and operate in these environments.
Question. Please explain how the F-35 will perform its role of
close ground support. How vulnerable is the F-35 to destruction by
rifle fire?
Answer. The U.S. Air Force cannot provide detailed descriptions of
how the F-35 will perform close air support (CAS) in an unclassified
forum. However, we can provide a general discussion of the capabilities
that make the F-35 a superb platform for CAS and provide detailed
information on operational procedures in a more appropriate forum if
requested.
The F-35 provides increased survivability and lethality with its
fused sensors, precision weaponry, large payload and fuel load, and
data-link capability, all offering distinct advantages in a CAS role.
The F-35 can provide precision fire on CAS targets while remaining out
of range of returning small arms fire and tactical surface-to-air
threats. In addition, the F-35's advanced stealth and improved
electronic attack and protection capabilities will allow it to conduct
CAS missions in areas where legacy platforms cannot operate and
survive.
To ensure survivability when conducting CAS, the F-35 program is
conducting extensive live-fire testing of the aircraft's ability to
survive battle damage, the most exhaustive live-fire testing the U.S.
military has ever conducted for a tactical fighter. This live-fire
testing includes extensive analysis of the impacts to the F-35's
survivability due to small arms fire.

SUBCOMMITTEE RECESS

Senator Durbin. Thank you for your testimony. Thanks,
everyone, for attending.
And this meeting of the subcommittee stands adjourned.
[Whereupon, at 11:35 a.m., Wednesday, June 19, the
subcommittee was recessed, to reconvene subject to the call of
the Chair.]