England Questions C-5 Rehab Cost

Deputy Defense Secretary Gordon England has started an “extensive review” of the C-5 modernization program, which USAF has just cited for a Nunn-McCurdy breach. Megan Scully of CongressDaily reports that a letter England sent to lawmakers also questions whether a fixed-price plan submitted by Lockheed Martin to cover the rest of the aircraft in the Reliability Enhancement and Re-engining Program will in fact curb soaring costs because it “includes provisions that would allow price adjustments.” Those in Congress who argue in favor of the Air Force continuing with RERP, even on the older A model of the C-5 fleet, have questioned whether the Air Force is inflating its estimate of the cost increase because service leaders would prefer to retire the C-5As and buy new C-17s. At a Capitol Hill hearing last week, Rep. Phil Gingrey (R-Ga.) chided the Air Force for not jumping at the Lockheed offer, which he said would mean the company “has to eat the difference” should the cost exceed the contract price. Air Force Secretary Michael Wynne responded that the issue comes down to “terms and conditions” that you reach, which, in this case, do not so far include the “unknown fix” for what the contractor will find when he looks under the skin of an A-model.