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The Next $1 Trillion Market: F-35 Sustainment Work

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Pentagon Hopes Competition Will Lower Costs

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Manufacturing Group November 6, 2012

With the Pentagon set to purchase fewer large platforms in the coming decades, defense companies are positioning themselves for the next best thing: the repair and upkeep of existing military equipment, a business that could be worth trillions of dollars.

That shift will be on full display starting Nov. 14, when more than 100 defense firms will descend on Washington for an industry day focusing on sustainment of the multinational F-35 Joint Strike Fighter program. Sustainment of the aircraft is projected to cost more than $1 trillion over the next 50 years, and the companies will be scoping how to snap up their piece of the JSF sustainment pie.

The JSF program office (JPO) in Arlington, VA, will host the sustainment-themed industry event, with the hope of creating more competition to drive down costs.

“We want to reduce F-35 life-cycle costs by injecting competition into the program,” says JPO spokesman Joe DellaVedova. “Our goal is to maintain a performance-based logistics strategy, where products and services are delivered on time and at, or below, costs.”

Companies are scheduled to hear presentations from program leadership on the first day of the meetings, followed by a series of 20-minute “one-on-one” sessions. DellaVedova says the meetings, which will be constrained to small groups, were so popular that the JPO had to add a third day to accommodate everyone.

The $1 trillion F-35 sustainment estimate has caused sticker shock among U.S. and foreign lawmakers, prompting program officials to look for every possible way to lower the costs. Robust competition for sustainment is one way F-35 officials believe they can reduce spending.

This month’s meeting with companies is an early step toward developing a long-term sustainment plan. The event will have four main focus areas: supply chain management, such as warehouse concepts and shipping containers; simulation training services, such as infrastructure for training centers and simulators; support equipment; and the Autonomic Logistics Information System (ALIS), a comprehensive software-intensive system designed to manage maintenance and spare parts.

Excerpted from Defense News. Click here to read the full article.

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