Plan Changes the Navy and Marine Corps’ Operational Concepts and Reduces Force Structure to Achieve Procurement Savings

The Plan proposes that the Navy and Marine Corps (1) merge operational  concepts; (2) reduce the number of squadrons, aircraft per squadron, and  backup aircraft; and (3) reduce the total number of aircraft to be procured  in the future. The Department of the Navy anticipates that these changes  will save approximately $28 billion in procurement costs over the next  18 years through fiscal year 2021. Navy and Marine Corps Merge Concepts of Operation

Operationally, the Navy and Marine Corps would increase the extent to  which their tactical aviation units are used as a combined force for both  services. Navy’s Analysis Generally Appears Reasonable, but Some Limitations Could Understate Risks

The Department of the Navy based its conclusion that it could meet its  operational requirements with a smaller force primarily on the results of a  contractor study. The contractor’s analysis generally appeared reasonable  because it assessed the relative capability of different tactical aviation  force structures and included important assumptions about force  structure, budget resources, and management efficiencies. However, the department  has not conducted such an assessment. These factors are (1) uncertainty about requirements for readiness funding  to support the tactical aviation force and (2) projected delays in fielding  the Joint Strike Fighter aircraft that might cause the Department of the  Navy not to implement the Plan as early as expected and might increase  operations and maintenance costs. Additionally, these delays will oblige the Department of the  Navy to operate legacy aircraft longer than expected, which could result in  increased operations and maintenance costs. Conclusions

The contractor’s study results provided the Department of the Navy with a  reasonable basis for concluding that it could afford to buy a smaller but  more capable force that would meet its future operating requirements by  using fewer Navy and Marine Corps tactical aviation squadrons of more  capable aircraft as a combined force and achieving efficiencies that allow  it to reduce the number of backup aircraft needed. Recommendations for Executive Action

To enhance the potential that the future Navy and Marine Corps integrated  tactical aviation force will meet the mission needs of both services and  ensure more transparency when making future decommissioning  decisions, we recommend that the Secretary of Defense take the following  three actions:    direct the Secretary of the Navy to thoroughly assess all of the factors  that provide the basis for the number of backup aircraft needed to  support a smaller tactical aviation force under the plan to integrate  Navy and Marine Corps tactical aviation forces,    develop guidance that (1) identifies the criteria and methodology for  analyzing future decisions about which units to decommission and  (2) establishes requirements for documenting the process used and  analysis conducted, and    direct the Secretary of the Navy to analyze future readiness funding  requirements to support the tactical aviation integration plan and  include required funding in future budget requests. To determine the process the Navy and Marine Corps used to assess which  reserve squadrons should be decommissioned in fiscal year 2004, we  obtained information from the Marine Corps Reserve Headquarters and  the 4th Marine Air Wing showing a comparative analysis of Marine Corps  Reserve squadrons.
Why GAO Did This Study

The Fiscal Year 2004 Defense Appropriations Act and the Senate Report for the 2004 National Defense Authorization Act mandated that GAO examine the Navy and Marine Corps' Tactical Aviation Integration Plan. In response to these mandates, this report addresses (1) how Navy and Marine Corps operational concepts, force structure, and procurement costs change; (2) the methodology and assumptions the services used to analyze the potential for integrating the forces; (3) the analytical process the services used to decide which reserve squadrons to decommission; and (4) other factors that might affect implementation of the Plan.

What GAO Found

Concerns about the affordability of their prior tactical aviation procurement plan prompted the Navy and Marine Corps to agree to a new Tactical Aviation Integration Plan. Under this Plan, the two services will perform their missions using fewer units of more capable aircraft and reducing total program aircraft procurement costs by $28 billion over the next 18 years. Operationally, the Navy and Marine Corps will increase the extent to which their tactical aviation units are used as a combined force to accomplish both services' missions. The Plan also reduces the services' tactical aviation force structure by decommissioning five squadrons, thus decreasing the number of Navy and Marine Corps squadrons to 59, and reduces the total number of aircraft they plan to buy from 1,637 to 1,140. The Department of the Navy based its conclusion that it could meet the Navy and Marine Corps' operational requirements with a smaller force primarily on the findings of a contractor study that evaluated the relative capability of different tactical aviation force structures. GAO's review of the contractor's methodology and assumptions about force structure, budget resources, and management efficiencies suggests that much of the analysis appears reasonable. However, GAO noted some limitations--including the lack of analytical support for reducing the number of backup aircraft--increase the risk that the smaller force will be less effective than expected. The Navy and Marine Corps each followed a different process in selecting a reserve squadron to decommission. The Marine Corps made a clear and well-documented analysis of the operational, fiscal, logistical, and personnel impacts of different options that appears to provide decision makers with a reasonable basis for selecting the Reserve unit to decommission. By contrast, the Navy selected its reserve squadron without clear criteria or a documented, comprehensive analysis, and thus with less transparency in its process. Two other factors that might affect successful implementation of the Plan are the potential unavailability of readiness funding and delays in fielding the new force. Although the contractor recommended that the Navy identify future readiness-funding requirements, to date, the Navy has not conducted this analysis. In addition, the Department of the Navy is experiencing engineering and weight problems in developing the Joint Strike Fighter that will cause it to be delayed until 2013, at least 1 year later than had been projected, and other high risks to the program remain. Because these delays will cause the Navy to operate legacy aircraft longer than expected, they might also increase operations and maintenance costs, making an analysis of future readiness funding requirements even more important.