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In October 2001, the Department of Defense (DoD) awarded the System Development and Demonstration contract to Lockheed Martin Corporation to proceed with the next phase of the $300 billion, two-decade-long development and production of the Joint Strike Fighter (JSF). Congress later directed DoD, which in turn asked RAND, to examine reasonable alternative locations and strategies for the final assembly and checkout (FACO) process. The authors considered alternatives to the current single-site approach in which Lockheed Martin will perform all JSF FACO at its Fort Worth, Texas, plant. RAND looked at single- and multiple-site options for carrying out FACO among four plants nationwide, including the Fort Worth site. The authors found that no efficiency, effectiveness, or cost reasons exist to split FACO operations between two sites or across multiple sites. In addition, moving some or all FACO from Fort Worth to another location would result in additional costs to DoD. The analysis also assessed reasons for splitting FACO that might reflect benefits not included in the authors' cost estimates, including such issues as the distribution of economic benefits to more than one region and the facilitation of competition among alternative sites. However, none of these was compelling enough to consider splitting the process.

Table of Contents

  • Preface

  • Figures

  • Tables

  • Summary

  • Acknowledgements

    Acknowledgments

  • Abbreviations

  • Chapter One

    Introduction

  • Chapter Two

    Splitting Production

  • Chapter Three

    Site Selection Issues: Plant and Major Facility Requirements for FACO

  • Chapter Four

    JSF Workforce Issues

  • Chapter Five

    Indirect Costs

  • Chapter Six

    State and Local Tax Credits and Incentives

  • Chapter Seven

    Environmental Costs

  • Chapter Eight

    Other Cost Factors: Stealth, Suppliers, and Energy

  • Chapter Nine

    Modeling the Cost Implications of Alternative FACO Strategies for JSF Production

  • Chapter Ten

    Results

  • Chapter Eleven

    Conclusions

  • Appendix A

    Legislative Language: The Floyd D. Spence National Defense Authorization Act for Fiscal Year 2001

  • Appendix B

    JSF FACO Site Assessment

  • Appendix C

    Wage Comparisons

  • Appendix D

    Environmental Regulatory Process

  • Bibliography

The research described in this report was performed under the auspices of RAND's National Security Research Division.

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