"themanwithsauce - has as many vehicles as job titles" (themanwithsauce)
12/12/2016 at 14:50 • Filed to: None
6
26|
"themanwithsauce - has as many vehicles as job titles" (themanwithsauce)
12/12/2016 at 14:50 • Filed to: None | 6
| 26 |
So just a bit of context, on the front page there is an article reporting Donald Trump saying that he’s going to “Save billions” on the F-35 program. Having just returned from a Department of Defense sponsored conference for a bunch of their contractors (many in aerospace) I can assure you - that ship sailed over a decade ago. Why? Two words - signed contracts.
The dirty secret behind this program is that the “private industry” that builds these parts is also all in agreements with one another to make sure everyone gets their slices of the pie. And if there isn’t enough pie? Call up the DoD and order another pie! And here’s the kicker - He already pledged to increase defense spending. Doesn’t matter if he’s going to fund other departments or projects. Increased spending overall basically means that everyone gets a payday.
Okay, I’m sure you’ve had enough baseless claims and want to know why I say this. Well, let’s walk through what happened at this conference. We were meeting to discuss how to replace some toxic metals in a lot of the paints and coatings on military hardware, particularly on the fighter jets and drones/missiles. We use metals like cadmium and hexavalent chrome to achieve the necessary adhesion and protection of critical hardware like landing gear, wing flaps, control surfaces, canopies, and more. You don’t want your multi-million dollar fighter to have a part fail cause it rusted while on the deck of your aircraft carrier. Nowadays, we have lots of replacements which are as good, or better, than the toxic paints and primers and whatnot. We have parts ready to go, right now, on these planes and are replacing them as-needed. So far, so good, right? Weeeeeeeeeeeeelllllll.....This is all well and good for the F-22, A-10, F-18, and more where production has stopped and planes in service are in constant need of parts and maintenance. But for the new F-35 we’ve got a bit of a conundrum. Follow along and see if you can spot the issue.
1. The F-35 components are manufactured per the agreements and contracts already signed years ago. Using the materials that were agreed upon and spec’d in years ago.
2. The F-35 is assembled and shipped out to wherever it needs to be. BUT! Technically, the plane is not supposed to fly as-is as the paints/primers on those parts are not supposed to be in use due to, again, agreements and contracts signed by the contractors and the military. However, there are exceptions so the plane can be used for now.
3. The very first time the plane needs any service or maintenance, it HAS to be decommissioned while the non-conforming parts are taken off and the new ones are put on. Whether the non-conforming parts need to be replaced or not is irrelevant.
4. The plane, now in full compliance, is sent back into service and the old parts are stripped, analyzed, and either recycled for scrap or sent back to be refinished. Ultimate irony would be if they’re sent back to be repainted and primed with the toxic metal materials. But I don’t know if that’s the case or not.
Why do we do this? Well when I asked the answer that I got is that the deals were done and signed and I guess not doing it is just as expensive due to fees or penalties or something. There are other reasons too (supposedly) and I’m sure I cut some corners here. But I just wanted to share some info from a recent trip I took and hopefully shed some light on where exactly things went south.
It’s just a 5 minute hot take and, again, there’s more to it than what I’ve said here but it’s a damn bit more than just “Shit’s expensive and it shouldn’t be.....we think?”. And understand - this conference and these discussions and this riamarole is just because of the paints and coatings for aerospace. I’m sure there’s a dozen more examples all across the military.
SidewaysOnDirt still misses Bowie
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 14:59 |
|
However, could a better jet be built for a similar price tag considering that the F35's going to ultimately cost a trillion which really means even more because this is government math? The answer to that one I think is pretty clearly yes.
3point8isgreat
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 14:59 |
|
I’ve always been baffled by the DoD procurement system. They have these huge project quoting rounds to decide which manufacturers to go with. Often seeming to choose whoever wrote down the smaller number. And then once the project is underway that manufacturer completely ignores their quoted price. They they charge the government the additional cost. How is that the DoD ends up footing that bill instead of the manufacturer just eating that cost because they quoted a price they couldn’t actually meet?
I don’t know of any other industry where you can win a bid with a low number, and then charge your buyer the entire cost-overrun.
Granted accurate quoting would of course result in much larger numbers up front, but what’s wrong with that if it’s honest? What’s the worst that could happen, some politician does a double take because they see a price more accurately reflecting the cost of the project before approving it? All before stamping “Buy” as fast as they can because it’s defense spending of course.
LongbowMkII
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 14:59 |
|
It’s too bad the DoD can’t be trusted with a blank check. I don’t think there’s a way to void it without destroying the economy.
Chariotoflove
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 14:59 |
|
You’re kinda portraying the government as having to grab its ankles and just take it, but surely they’re not that that powerless to negotiate?
TheTurbochargedSquirrel
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 15:02 |
|
One thing that I am noticing as he blabs on about things costing too much is that he doesn’t understand development costs. New jets don’t just magically appear.
BorkBorkBjork
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 15:04 |
|
Let’s not fall into a sunk cost fallacy, the F-35 is barely functional. The United States building the worlds greatest manned stealth aircraft in 2016 is like Japan building the worlds greatest Battleship in 1941.
That worked out well for them.
|
themanwithsauce - has as many vehicles as job titles
> Chariotoflove
12/12/2016 at 15:04 |
|
It’s a bit more complicated, because the companies talked to the other companies and all agreed to do this together.....kind of. I only know so much of it myself.
At the heart of it all though, remember this - The government makes nothing. There is no “Landing gear mfg company, property of the Air Force” that can do this if the government gets mad at “Superior Landing Gear - a division of lockheed martin inc.” so yeah yo ucan negotiate.....with someone else who eats at the same table. My point is more that if you keep increasing the military budget, then they will find ways to spend the money. If we actually cut the budget, there’d be a standoff for a bit, but these companies KNOW they make good margins and would eventually buckle down a bit.
|
themanwithsauce - has as many vehicles as job titles
> BorkBorkBjork
12/12/2016 at 15:06 |
|
Agreed. And the process is dumb because the F-35 could, and should, be cheaper.
Whether its an effective fighter or not is a seperate discussion. Important one, for sure, but the price can be analyzed without bringing up the abilities of the craft.
MrDakka
> 3point8isgreat
12/12/2016 at 15:16 |
|
Cost plus contract vs fixed price contract. Cost plus contracts arose to cover the cost of RDT&E that companies did in order to make said product in the contract. Supposedly done to help smaller companies, but like all good things it was abused to create nightmarishly expensive weapons platforms.
Comes over to help work on your car and only drinks beer
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 15:21 |
|
The dirty secret behind this program is that the “private industry” that builds these parts is also all in agreements with one another to make sure everyone gets their slices of the pie.
This is also partially the fault of the politicians as well. Part of the reason the F35 was never able to be killed (and I’m not arguing it should be, but some think so) is that it’s build was spread out into enough districts so that there were enough politicians who would never go against it because it was ‘jobs for their district’. That was very intentional.
BigBlock440
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 15:30 |
|
Just one point of contention, He didn’t say he’d cut costs on the F-35, just that it was damn expensive and he was going to save billions from somewhere. Interesting inside look otherwise though.
K-Roll-PorscheTamer
> BorkBorkBjork
12/12/2016 at 15:35 |
|
Too savage. I shall now call all F-35s “Yamato Jets”. :p
Breakfast Burrito: The True Resident Burrito
> TheTurbochargedSquirrel
12/12/2016 at 15:36 |
|
Of course he understands development costs. If anyone, Boeing and Lockheed don’t understand their own costs well enough when they sign the deal.
All the costs are figured in before the deal is made. Boeing says, “It will be $3 billion to develop, produce, and maintain two Air-Force Ones for x number of years.” The US says fine and signs the deal. Then years later, due to either incompetence or corruption, the bill has run up to $4 billion. Trump is right to question the 33% increase. It’s like if you pre-order a game for $60, and they end up charging you $90 for “extra development.”
The F-35 is even worse, as it’s cost has doubled, it’s late by 4 years, and it can’t even perform. Perhaps OP is right when he says the deals made in advanced don’t allow for the US to exit or renegotiate when costs run amok, but if that’s true, these are the exact kinds of “bad deals” and corruption the Donald has been talking about since day one.
edit: the pre-order analogy is bad math. It’s actually $80, not $90.
Bman76 (hates WS6 hoods, is on his phone and has 4 burners now)
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 15:37 |
|
“We need to get our schoolchildren into the workforce. Clearly some of the parts can be made out of papermache.”
Porsche was my first word
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 15:44 |
|
Beautiful insight!
I think the problem with the F35 lays in it’s conception. A jack of all trades is a master of none. But that is what was demanded: master of all trades. The doesn’t work out or costs explode.
facw
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 16:29 |
|
If he’s really interested in reigning in spending, he’ll look to the LRS-B, which seems primed to repeat most the F-35 program’s mistakes. Seems like we’d be very lucky to get the planes at twice what Northrop bid.
|
facw
> MrDakka
12/12/2016 at 16:32 |
|
Right, but setting aside the fact that cost plus makes little sense in general, it makes no sense to select a bid based on estimated cost if the contract is not going to hold the contractor to that cost. If you want to apply cost plus, you at the very least need to look at the company’s past history in meeting their cost targets (after the F-22 and F-35, Lockheed should never be allowed another cost+ contract).
|
BorkBorkBjork
> K-Roll-PorscheTamer
12/12/2016 at 16:36 |
|
It is sad, but true. Any near-peer state worth its salt will counter our massively superior aircraft with massive numbers of cheap drones. You can buy dozens of small, stealthy drones for the prices of a single F-35 and arm them with just a pair of Air to Air missiles.
|
themanwithsauce - has as many vehicles as job titles
> Breakfast Burrito: The True Resident Burrito
12/12/2016 at 17:09 |
|
Anyone who has balanced a budget can tel you it’s a bad deal. Donald has no idea how to stop it though. He wants to increase spending which means these deals will continue. DoD contractors grab every dollar that is available.
As a former automotive supplier employee, if I came up with a solution for GM or Ford or FCA that said “Look, let us make this part, then the second the car needs an oil change, that part gets replaced by our competitor! Which you’ll also buy and pay for the labor to replace! That way, we BOTH get parts contracts!” I’d be fired. Immediately. With great prejudice. That’s how the private sector works.
But in this case, that same scenario probably got someone a promotion because there was more money on the table. That’s a wholly different world than the one of finite resources and a fixed price point at the end. Consumers will only pay so much money for a sedan or pickup truck. Fighter jets? Those are bought ahead of time, and THEN you get to know the price. Oh and the price tag has MANY MANY ZEROES. It’s very hard to jump from one to the other. Honestly, Trump has no relevant experience here. And I say that the way to get the costs under control is to cut the budget for procurement of new vehicles and planes. Watch as those same contractors rewrite contracts and wheel and deal like a car salesman at the end of the month.
|
K-Roll-PorscheTamer
> BorkBorkBjork
12/12/2016 at 17:36 |
|
We (America) have to have the biggest sausage across land, sea, and air. It’s how we roll our meat . Qualitative vs Quantitative comes to mind, but having just quantitative fighters, or both Q&Q would make it look like America has many tiny-medium sized sausages I reckon.
I call it the “Yamato Plan” -_-
CCC (formerly CyclistCarCoexist)
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 18:37 |
|
You actually make a valid point.
But he doesn’t want to listen, he’ll drown actual fact with angry chants of “MAGA” and does not realize he’s an actual president.
Steve in Manhattan
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 19:11 |
|
Trump does not seem to believe that signed contracts apply to him. However, he should be schooled on how government contracting works.
gmporschenut also a fan of hondas
> themanwithsauce - has as many vehicles as job titles
12/12/2016 at 20:46 |
|
The same day this dropped. Hmmm I’m sure just a coincidence.
I have a friend in the air force. they needed an important part needing replacement during a routine maintenance procedure worth @$2k. Knowing they would need it in about a month, did they order it ahead? Did they notify that it would be coming up? Nope they waited 2 weeks after it was due while the plane was grounded. Then when the plane was scheduled to go, going “oh shit oh shit” they had to have a representative from the company fly with the part out to the base. hand it over, (wait a day because you can’t make someone fly the next day) and then fly back. so 3 days travel at 10k a day, this 2k part cost @50 k to get sent out.
Now I’m not saying they should have Fedex’ed it, but with almost daily flights in/out, it boggles the mind how they couldn’t arrange to have it fit it on a c-130 or globemaster. Are the folks that ok’ed this still around., yes is there any incentive for any of them to reduce costs? No
So he started showing up to the daily meeting of the contractors and they were like “who told you to come here?1?!?” “Why are you here?!?!”
“Because your fucking my shit up and sitting on your ass”
Trimming the fat won’t happen. Instead low hanging fruit will be cut (air force one) and service member benefits.
I work with a guy in procurement who is part of a procurement trade organization. they had one of their chapter meetings attended by a number of DoD staff. the way contracts are sent. Often required by politicians is nuts. One example was a guy who set up a shop in the Dakotas to manufacture some stupid part. as he was the only shop with the capability, in the region he got the contract.
|
MrDakka
> facw
12/12/2016 at 21:48 |
|
LockMart needs to resurrect Clarence Kelly Johnson and have him helm the company again.
|
facw
> MrDakka
12/12/2016 at 21:52 |
|
His small team of talented people seems to be basically the opposite of what LM stands for these days. They more people you have, the more you can charge the government, and the more you can spread those jobs out to make projects unkillable. LM is as much a Congressional pork vector as it is an aerospace design company these days. Presumably there must be some smart people working on the F-35, but I definitely didn’t meet any of them on my trips to Lockheed’s F-35 office in Ft. Worth.
|
MrDakka
> facw
12/12/2016 at 21:55 |
|
And here I was applying to LM jobs in Fort Worth...