F-35 Program Faces $85M Loss in Spare Parts, GAO Reports

A recent report from the Government Accountability Office (GAO) reveals a startling loss of over 1 million F-35 spare parts, worth approximately $85 million, within the past five years. The report underscores a lack of a government-owned tracking system, which has resulted in an unclear picture of the total quantity, location, and value of spare parts in the global inventory.

Over 1 million F-35 spare parts lost by DoD and Lockheed

The actual loss of spare parts could be substantially higher than reported by Lockheed Martin, the main contractor, according to the GAO. Efforts to establish a reliable tracking system have been stalled due to disagreements between the Defense Department and Lockheed Martin regarding the categorization of the missing parts.

Audit results suggest that the F-35 program lacks accurate data on whether contractors are effectively managing the spare parts. These shortcomings have been observed since 2018.

In response, Lockheed Martin clarified that the losses reported span the last two decades of the program. The company is actively collaborating with the F-35 Joint Program Office and the Defense Contract Management Agency to compile the necessary documentation for disposal of “excess, obsolete or unserviceable” components.

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The F-35 program office has confirmed its agreement with GAO’s recommendations on enhancing spare parts tracking. The office emphasized its awareness of the location of the majority of F-35 spare parts within the global supply chain.

The Defense Department office cited Defense Federal Acquisition Regulation Supplement rules, stating that the F-35 program exceeds the goal of 95% accuracy in recorded inventories. The program office’s error rate is roughly 1%, significantly below the government goal of 5%. Efforts to further improve spare parts accountability and enhance readiness for combat forces are ongoing.

Currently, F-35 spare parts tracking is conducted through a non-government system. However, the program office is working towards transitioning the data to a government system.

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The international F-35 program, which involves the United States and other nations such as the United Kingdom, Norway, Italy, Canada, Israel, Japan, and South Korea, utilizes a “unique” system for managing spare parts. The Defense Department retains ownership of the global pool of spare parts until a part is installed on a fighter jet.

The GAO report highlighted the lack of a Pentagon plan to maintain accountability over the F-35 parts and equipment following a 2012 decision that established U.S. government ownership of these parts until installation on a fighter.

Moreover, the majority of lost F-35 parts don’t undergo adjudication to assess responsibility for the loss and identify the root causes. The JPO has adjudicated fewer than 20,000 of the approximately 60,000 parts worth about $19 million that Lockheed Martin submitted.

Furthermore, disagreements over the categorization of these parts between Pentagon offices, main contractors, and the JPO have hindered progress towards better tracking. Lockheed and the Defense Contract Management Agency’s office in Fort Worth, Texas, differ from the JPO, Pratt, the Office of the Undersecretary of Defense for Acquisition and Sustainment, and the Defense Contract Management Agency’s aircraft propulsion office in considering these parts as government-furnished property.

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In addition, over 19,000 parts in the global spares pool are unusable due to being surplus, obsolete, or unserviceable. These parts have awaited disposal instructions for periods ranging from a few months to five years.

GAO auditors recommend measures to ensure accurate categorization and accountability of all worldwide spare F-35 parts under a contract. They also advocate for clearer policies on when parts are considered government-furnished property and for a process to report lost spare parts and dispose of unusable ones.

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