F-35 Part Shortage Grows as GAO Flags Risk of Turkey’s Exit
F-35 Parts Shortage Grows as GAO Flags Risk of Turkey Expulsion
(Bloomberg) -- Lockheed Martin Corp’s F-35 program was hampered last year by growing parts shortages from its supply chain that “increased significantly” and could be further complicated by the U.S decision to expel Turkey from the program, according to congressional investigators.
The Government Accountability Office, in its latest annual report on the $428 billion F-35 program, cited progress in reducing outstanding deficiencies, exceeding 2019 aircraft delivery goals, reducing per-aircraft costs and changing the production process for the warplane to improve efficiency.
Still “more needs to be done,” investigators wrote in the report on the production of the next-generation stealthy fighter that was published Tuesday. “The program is at risk of missing its test schedule and not meeting manufacturing leading practices.”
Among key issues that need improvement as the program approaches a full-rate production decision in 2021: Aircraft reliability, which remains below target; on-time delivery and better quality of Pratt & Whitney-built engines; and supply chain parts shortages, the GAO said.
“F-35 aircraft in the field have not met standards for reliability and maintainability, indicating that the program is not delivering aircraft at the level of quality expected,” according to the report.
In addition, Turkey’s suspension from the F-35 program last year over President Recep Tayyip Erdogan’s decision to buy the Russian S-400 air defense system is “likely to compound production risks” until alternate suppliers for all 1,000 parts Turkish companies produce are found, according to the report.
The program has identified new sources for the components but is “assessing the effect of 15 key parts not currently being produced at the needed production rate,” according to the report.
A U.S. official told the GAO that Turkish suppliers will provide parts through deliveries of the 14th production contract, or about 2022, in order to help “avoid disruptions to aircraft deliveries and additional cost growth from standing up new suppliers.”
Some of these new suppliers “will not be producing at the rate required until next year, as roughly 10% are new to the F-35 program,” the report added.
That is compounding the most serious current problem identified: The increase in the number of parts delivered late to the production line. The backlog has “grown steadily over the past two years -- from under 2,000 to over 10,000 between August 2017 and July 2019,” according to Defense Contract Management Agency data cited by the GAO. According to Lockheed, about 60% of the shortages are caused by 20 suppliers.
Program officials told GAO investigators that some suppliers “struggled to meet increased production demands in 2019 and, as a result, the program witnessed increased rates of late deliveries or parts shortages.” Between July 2018 and July 2019, the parts shortages per month increased from 875 to over 8,000.
About 520 of a potential 3,200 F-35s for the U.S. and allies already have been delivered and will have to be retrofitted as flaws are fixed at the cost of as much as $1.4 billion.
The Pentagon’s F-35 program office issued a statement saying the report “was completed with the F-35 program’s full cooperation and unfettered access to information. There were no surprises in the report and the items mentioned are well known.”
Lockheed Martin spokesman Brett Ashworth said in a statement that “the GAO report offers information from 2019, and since then we have delivered our 500th aircraft, trained our 1,000th pilot and 9,000th maintainer, and eclipsed more than 280,000 total flight hours.”
Since 2017, “we have met our commitments with an increase of nearly 200% in aircraft deliveries while driving costs below $80M per aircraft,” Ashworth added. “We have also seen significant progress in the areas of supply chain reliability and fleet sustainment improvements.”
The GAO found that Pratt & Whitney’s performance delivering the aircraft’s engine last year declined as defect reports increased 16% over 2018. Eighteen engines failed during assembly tests and had to be taken apart for rework -- eight more than 2018.
Pratt & Whitney at one point “stopped deliveries due to the test failures, which slowed engine acceptance and reduced on time deliveries,” the GAO said.
Pratt & Whitney, now a part of Raytheon Technologies Corp., increased its production rate by roughly 51% in 2019 but “on-time delivery performance has continued to decline which officials attribute to production quality issues and parts delays.” Last year, 91% of engines delivered were late but Lockheed Martin “was able to work around the late engine deliveries to deliver the entire aircraft on time,” the GAO said.
“These issues are affecting engines built at the engine contractor’s production facility in West Palm Beach, Florida, which opened in 2014,” according to the report. Pratt & Whitney “has developed new tooling for the assembly line and has established a team to identify characteristics leading to the test failures.”
A Pratt & Whitney spokesman didn’t immediately respond to a request for comment.
©2020 Bloomberg L.P.