The Case for Engine Competition
Congress has long been a champion of competition for major
acquisition programs and served as a watchdog of taxpayer money,
demanding accountability and mitigating risk through annual
reviews and re-competes.
If history has taught us anything, it’s that competition always leads to a robust, more affordable outcome. During “The Great Engine War” of the 1980s, GE introduced the F110 engine to power the F-16 fighter jet, and in the process, created a number of benefits for the aircraft.
F-16 Reduced Engine Acquisition Cost
With the introduction of the GE F110 engine, the average acquisition price of the F-16 fell
26%. When that percentage is applied to the today’s Joint Strike Fighter, those savings add up to $20 billion.
Increased F-16 Aircraft Sales
In almost every situation, competition leads to a better product. Engine competition on the
F-16 has led to better efficiencies, less maintenance and lower overhead. These cost reductions give international partners more opportunities to participate in the F-16 program.
Thrust increase
After engine competition was introduced, the F-16 experienced a thrust increase of 30%.1
Scheduled Engine Removal
The scheduled engine removal interval for the F-16 was increased by 300% after the introduction of engine competition.2
Stall reduction
Because competition demanded better performance from the airplane and powerplant, engine stalls were reduced by 10X from the previous measurement.3
Unscheduled engine removal
Costly unscheduled engine removals were reduced by 2X versus pre-engine competition levels.3
Aircraft losses
The number of aircraft lost fell by 2X after engine competition was implemented.4
- F100. http://www.pw.utc.com/Products/Military/F100 (9 July 2010)
F110. http://www.geae.com/engines/military/f110/index.html (9 July 2010) - U.S. Air Force Tech Orders
- Camm, F. 1993. The Development of the F100-PW-220 and F110-GE-100 Engines.
A Case Study of Risk Assessment and Risk Management. RAND Note N-3618-AF:
Pg 40, Table 4.2. - U.S. Air Force Safety Center, 2009. F-15/F100-PW-100 Engine-Related Class A Flight
Mishaps as of 31 March 2009. www.afsc.af.mil/.
Strong Performance
- There has never been an engine competition for the Joint Strike Fighter. Ever.
- Congress has funded the F136 alternate engine from GE/RR for 14 years in order to preserve competition on the largest weapon procurement program in history.
- Changing course to give a 30-year, $100 Billion, uncontested sole-source contract to Pratt & Whitney (P&W) directly contradicts the Weapon Systems Acquisition Reform Act of 2009.
Low Cost
- The GE/RR engine is on budget. In contrast, P&W is over plan by $1.9 Billion to date. At this rate, it is projected to reach $12.7 Billion in total contract overruns. This could take more than 100 aircraft out of the program and represents a serious disruption to the JSF program.
- A May 2009 Government Accountability Office (GAO) report cites a similar fighter program, the F-16, in which 21% overall cost savings were realized through competition. On the JSF, that would equate to more than $20 Billion over the life of the program. Further, according to the GAO, the GE/RR engine will pay for itself with just a 9-11% savings.
- GE/RR will hold costs by offering fixed-price contracting, consistent with the objectives of a recent White House directive and the Weapon Systems Acquisition Reform Act of 2009.
Better Service
- GE/RR has consistently received top Department of Defense contract performance evaluations. In contrast, the aviation media have reported on technical issues with the P&W engine that have been responsible for program delays.
- The GE/RR engine was specifically designed for the JSF, and is the only engine designed to grow with the aircraft. P&W has already announced a redesign1, which adds cost beyond their current $1.9 Billion overrun.
- During the last major single-engine fighter procurement program, the F-16, P&W’s safety record and maintenance costs were 2 – 3 times worse before GE entered the game. Today, GE’s alternate engine powers every combat F-16 in the active U.S. Air Force, thanks to Congressional insistence on adding competition to improve the program.
1 - Jane's Defense Weekly (03-27-09)
Secretary of Defense Robert Gates provided a statement to the Senate Armed Services Committee on February 2, which included five reasons why the Department of Defense (DoD) is moving to cancel the F136 competitive engine for the Joint Strike Fighter (JSF). GE Rolls-Royce wishes to respond.
DoD: The F136 still requires a $2.5B investment over the next five years.
By the end of FY2010, almost $3B will have been spent on the F136 since 1996, with less than $1B needed to complete development. Over the next five years, additional costs associated with tooling and support infrastructure bring the total to about $1.3B -- far less than cited by the DoD.
DoD: The F136-F135 competition would not offset the additional costs. Analytical models produce a break-even scenario at best.
The JSF program lifetime propulsion cost could reach $100B, and a decades-long engine competition only needs to generate a 1 percent to 2 percent cost benefit to recoup the remaining dollars needed to complete the F136 program. Last May, the GAO anticipated a 20 percent benefit from a JSF engine competition, using the F-16 "Great Engine War" as a comparison. There are also vast benefits beyond sheer cost -- related to operational readiness and contractor responsiveness.
Last September's proposal by GE Rolls-Royce for a unique fixed-price contract for low rate F136 production engines has already created a significant benefit -- causing P&W to respond to their cost issues.
DoD: The F136 is three to four years behind the F135.
Continued funding of the F136 engine will result in production introduction approximately 100 engines after the F135 production introduction for a JSF program predicted to exceed 4,000 aircraft. By comparison, GE did not enter production in the Great Engine War until 1,500 F-16s had been produced. The USAF’s own assessment was a 20 percent benefit in acquisition cost for that program.
DoD: Split or shared buys don’t produce competitive behavior.
The GE/RR presence in JSF has already influenced more responsive contract behavior. Split buys through an annual competition for JSF will create a unique opportunity to drive competitive behavior beyond the acquisition phase -- into competing engine sustainment costs lasting for decades. The JSF engine competition is different from the storied F-16 competition because the JSF model extends to engine sustainment. The opportunity for cost savings through competition are outstanding, as cited by the GAO and many other procurement experts; consistent with the tenets of the Weapon Systems Acquisition Reform Act of 2009.
DoD: The many JSF customers are unwilling to buy from two engine suppliers.
All eight international JSF partners have signed an MOU which recognizes competing engines as a key JSF feature. The international JSF partners strongly support competing engines. Whichever engine they choose will be better and more affordable because of the competition.
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the F136 engine program.
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Five Reasons to Support the F136
The Fighter Engine Team’s response to Secretary Gates’ call to cancel the F136 competitive engine.
...this is not a question of pork; it is a sincere concern for the success of the F-35 program and for the benefits of competition. 
— Chairman Ike Skelton 