	Background

The F/A-22 is planned to be an air superiority and ground attack aircraft  with advanced features to make it less detectable to adversaries (stealth  characteristics) and capable of high speeds for long ranges. It has  integrated avionics that greatly improve pilots’ awareness of the situation  surrounding them. Following a history of increasing cost estimates to complete the  development phase of the F/A-22 program, the National Defense  Authorization Act for Fiscal Year 1998 established a cost limitation for  both the development and the production. Significant Changes Have Occurred in the F/A-22 Program during Nearly Two Decades of Development

The F/A-22 program has experienced several significant changes since it  began development in 1986. First, the Air Force cannot afford to purchase  the quantities of aircraft that were originally planned 18 years ago. Lastly, the Air  Force has determined that new computer processors and architecture are  needed to support some planned enhancements, which will further  increase program costs and risk. These schedule extensions, delays, and cost increases were major  contributors to changes in the Air Force’s initial plan to purchase  750 aircraft. To enhance the utility of the F/A-22, the  Air Force plans to develop a robust air-to-ground attack capability to be  able to engage a greater variety of ground targets, such as surface-to-air  missile systems, that have posed a significant threat to U.S. aircraft in  recent years. In March 2003, the Office of Secretary of Defense’s Cost Analysis  Improvement Group (CAIG) estimated that the Air Force would need  $11.7 billion for the planned modernization program. In addition, the F/A-22  program is not performing as expected in some other key performance  areas, including reliability and maintenance support. This has led to the development test aircraft spending more  time than planned on the ground undergoing maintenance. At the present time, the Air Force expects to complete IOT&E in  October 2004, before the full rate production decision, now expected in  December 2004. The Director of Operational Test and Evaluation, Office of Secretary of  Defense, believes the start of testing will slip, although the Air Force  maintains it will meet its schedule. DOD Did Not Provide Congress Sufficient Business Case Information to Justify Current Aircraft Quantities or Modernization Investment Plans

DOD has not provided Congress with sufficient information to support the  business case for buying and modernizing the F/A-22 program. In  its response, DOD did not sufficiently address key business case questions  such as how many F/A-22s are needed, how many are affordable, and if  alternatives to planned investments increasing the F/A-22 air-to-ground  capabilities exist. Therefore, DOD must still make investment decisions affecting another  $40 billion to support this program through full rate production and  implementation of the spiraled modernization effort. In light of the uncertainty concerning how many aircraft are needed in  today’s environment, the large investments that remain, and the unknown  outcomes of planned initial operational testing, we continue to be  concerned with DOD’s readiness to address a December 2004 decision to  enter full rate production. Specifically, we recommend that the Secretary of Defense take  the following two actions:    Complete a new business case analysis that determines the continued  need for the F/A-22 and that specifically (a) addresses the need for an  expanded air-to-ground capability and an assessment of alternatives, to  include the feasibility of using other assets like the F-35 and unmanned  aerial vehicles planned for the future; (b) justifies the quantity of  F/A-22 aircraft needed to satisfy requirements for air-to-air and  air-to-ground missions; and (c) provides evidence that the planned  quantity is affordable within current budgets and the congressional  funding limitation. F-22 Aircraft: Development Cost Goal Achievable If Major Problems Are  Avoided.
Why GAO Did This Study

Following a history of increasing cost estimates to complete F/A-22 development, Congress asked GAO to assess the Air Force's F/A-22 development program annually and determine whether the Air Force is meeting key performance, schedule, and cost goals. On April 23, 2003, a congressional subcommittee requested that the Department of Defense (DOD) provide more detailed information on the business case that supports the estimated quantities and costs for an affordable F/A-22 program. Specifically, GAO (1) identified changes in the F/A-22 program since its inception, (2) reviewed the status of the development activities, and (3) examined the sufficiency of business case information provided for congressional oversight.

What GAO Found

The Air Force is developing the F/A-22 aircraft to be less detectable to adversaries, capable of high speeds for long ranges, and able to provide a pilot with improved awareness of the surrounding situation through integrated avionics. In addition, the Air Force plans to expand the F/A-22's ability to engage targets on the ground to provide a robust capability not originally planned at the start of the program. The Air Force plans to begin initial operational test and evaluation in March 2004 and to seek full rate production approval in December 2004. The F/A-22 program has experienced several significant changes since it began development in 1986. First, the Air Force cannot afford to purchase the quantities of aircraft that were planned 18 years ago. The Air Force had originally planned to buy 750 aircraft, but it now estimates it can only afford 218 aircraft. Second, in order to develop the expanded air-to-ground attack capability, the Office of Secretary of Defense estimates that the Air Force will need $11.7 billion in modernization funding. Lastly, the Air Force has determined that new avionics computer processors and architecture are needed to support most planned enhancements, which will further increase program costs and risk. Further, the development test program continues to experience problems and risks further delays. The F/A-22's avionics continue to experience shutdowns and failures. Moreover, the F/A-22 has not met its reliability requirements and has experienced failures in its computerized maintenance support system. This has led to aircraft spending more time on the ground undergoing maintenance. Due to the risks of future cost increases and schedule delays, a congressional subcommittee requested that DOD provide business case information on the F/A-22. However, the information DOD provided did not address why this aircraft is needed given current and projected threats. The business case also did not address how many aircraft the Air Force needs to accomplish its missions, how many the Air Force can afford considering the full life-cycle costs, whether investments in new air-to-ground capabilities are needed, and what are the opportunity costs associated with purchasing any proposed quantities of this aircraft. While the response stated that the Air Force still plans to buy 277 F/A-22 aircraft, the Air Force estimates that only 218 aircraft are affordable within congressionally imposed funding limitations. In addition, significant investment decisions remain and could affect another $40 billion to support this program through full rate production and implementation of the spiraled improvement efforts. In light of the uncertainty concerning how many aircraft are needed in today's environment, the large investments that remain, and unknown outcomes of planned operational testing, GAO continues to have concerns regarding the DOD's readiness to make a full rate production decision.