Contract Negotiations and Results in Aircraft Procurement

Case Studies of the B-52 and B-58

L. E. Preston

ResearchPublished 1962

A survey of the history of negotiations and contracts for two models of bomber aircraft: the B-52 and the B-58. Each of these two procurement histories reflects a distinct approach to contract negotiations. The first is a "work done" strategy in which the contractor's estimates of his own costs become the principal basis for negotiation, with an effort directed at examination and possible lowering of the cost estimates. The second is a "position" strategy which uses elements of the contract to establish a range of outcome from which the contractor may select various combinations of prices and profits.

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Preston, L. E., Contract Negotiations and Results in Aircraft Procurement: Case Studies of the B-52 and B-58. Santa Monica, CA: RAND Corporation, 1962. https://www.rand.org/pubs/research_memoranda/RM3254.html.
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