US procurement delays raise costs

22/02/2012

The delays to US defence procurement projects intended to save money within overall spending cuts commitments could raise costs in the long-run, defence experts in Washington D.C. highlighted. Following the adoption of the 2013 federal budget, the US Department of Defense decided to slow down purchases of F-35 fighter jets, the nuclear submarine programme, and other expensive procurement and construction projects. Experts agree that the strategy of pushing the costs into the future contains a significant risk of bigger cuts later on, because keeping industry and government teams working at slower pace while maintaining older equipment will raise overall costs. According to Tom Burbage, Director of Lockheed Martin’s F-35 programme, the delay in the aircraft procurement “will raise the overall average cost of the total procurement of all the airplanes bought. It just changes the dynamics of the cost equation.”

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