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Air Force Partnering with Industry

Air Force Materiel Command. Developing, Fielding, and Sustaining America’s Aerospace Force. Air Force Partnering with Industry. May 2004. What are Air Logistics Centers?.

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Air Force Partnering with Industry

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  1. Air Force Materiel Command Developing, Fielding, and Sustaining America’s Aerospace Force Air Force Partnering with Industry May 2004

  2. What are Air Logistics Centers? Highly industrialized complexes focused on providing world class, comprehensive “one-stop” product support, depot-level maintenance and repair, and supply chain management of all current and future USAF air and space systems Warner Robins ALC Robins AFB GA Oklahoma City ALC Tinker AFB OK Ogden ALC Hill AFB UT

  3. Depot MaintenanceOrganic Scope of Operations • FY03 Budget of $6.4B • 22,008 Personnel (End of Nov 02, Includes Military) • ALCs Repair/ Major Overhaul 3 Aircraft Per Day • Complete 13 Engines & Modules Daily (3,300 PY) • ALCs Turn Out 1,328 Components Per Day

  4. Air Force Supply FMS Supply Scope of Business 25 ALC Supply Chain Management Organizations 157,000 Line Items Organic & Contract Depots $1.4B Buy $3.3B Repair Manufacturers Net Sales $5.76 Billion 1.7M Units 760K Units TRANSCOM 4% Other federal agencies, aircraft and missile procurement 5% 9% (Other) 26% 3% 1% 61% 1% AIR FORCE ARMY NAVY DEPOT Source: FY03 sales data came from Keystone.

  5. Depot Maintenance Strategy World Class Depots Quality Workforce Innovative Process Right-sized Infrastructure AF Depot Maintenance Strategy “Depots must be revitalized, transformed, world class…” - AF Depot Strategy AF Depot Maintenance Master Plan (Roadmap) Global Vigilance, Reach, Power Air Expeditionary Force Invest $150M per year (FY04/09) Agile Combat Support Robust Depot Capabilities More Aircraft Avail Lower Cost Superior Quality Faster Response

  6. AF Depot Maintenance Competencies • Key Processes • Airframe Overhaul and Repair • Engines • Software Development • Landing Gear • Hydraulic Systems • Avionics/Electronics • Oxygen Systems • SLBM Overhaul Repair • Weapons & Air Munitions • Repair Capabilities • Strategic Airlift/Refueling A/C • Bomber Aircraft • Fighter Aircraft • C4ISR Aircraft • Strategic Land-based Missile Enablers Process improvements Infrastructure improvements Effective financial processes Partnering Oxygen Systems Land Based Strategic Missile Systems Avionics/ Software Airframe Repair Engines Landing Gear Hydraulic Systems Weapons/ Munitions We must transform our culture and business practices to stay competitive! More responsive – Less cost - Superior quality

  7. AFMC Partnering Philosophy • History: • Common law • Historic GFE/GFS effort • ’95 BRAC teaming • 10 USC 2474 • Cardinal goal: enhanced warfighter support • Important considerations: • Improved readiness • Affordability • Technology transfer and sustainment • Mutual benefit • Partnerships are: • Focused on the cardinal goal • Long term—lifecycle sustainment vehicle • Program (e.g., F/A-22) dependent, • Technology (e.g., composites, software) tied, or • Workload independent (e.g., education, redevelopment) • Not mere contracts—multipartite and flexible • Crafted on a common business plan • Operated through diverse implementation agreements with a variety of business instruments

  8. AFMC Partnership Structure System X Partnership Partnership Agreement Process Improvement IA Engineering IA Work Share IA Facilities & Equipment IA Strategic Sourcing IA Direct Sales IA

  9. Demographics • Where we are today—FY03 Summary: • 29 active depot maintenance partnerships • Workshare—13 • Teaming—1 • $4.5B estimated life cycle revenue • 1.5 million core capability hours • 50 new partnerships under development • Growth across weapon systems and commodities • Direct Sales—13 • Lease—2

  10. Key Legislative Changes • FY 2002, Public-Private Business Arrangements • Change to 10 USC 2563(c)(1)(B) permits claims for damages caused by Government poor contract performance • Proposal: FY 2005-Depot Partnering • Repeal of the sunset clause for the partnering exemption from 50-50, 10 USC 2474(f)

  11. Current Partnership Examples • Northrop Grumman • B-2 Composites (Direct Sales) • Missiles: ATE rehost, update GPS, Propellant System Rocket Engine (Workshare) • J-STARS (Workshare) • Alliant Techsystems • F-22 composite parts (Direct Sales) • Aerospace x-ray (In-kind use transaction) • Lockheed Martin • F-16 FCC - Italy (Workshare & Direct Sales) • F-16 block 40 & 50 software, avionics (Workshare) • LANTIRN (Workshare) • F/A-22 sustainment (Various) Innovation & Excellence

  12. Current Partnership Examples • Boeing • C-17 landing gear, power systems, hydraulics, avionics (Direct Sales) • Triumph Air Repair • C-17 APU (Various) • Goodrich • F-16, F-15, KC-135 and C-17 landing gear (Various) • Northwest Machine & Manufacture • Complementary expertise for surge and other DoD work (Various) • Honeywell • Auxiliary Power Units / Electronics (Various) • Utah System of Higher Education • Cooperative tech & prof training/ education Legend: Executing work IA in place Developing IAs

  13. Key Growth Areas • Overall Product Support • C-17 • F/A-22 • F-35 • Specific Industrial Base Integration • Centers of Industrial and Technical Excellence

  14. Key Issues • Defining “True Partnership” • Meet Title 10 & Best Value • Establish within RFP • Assign clear responsibilities • Develop depot technical data • Enable private investment • Use existing policies • Involve OEMs Desired State Current State Variability

  15. How Industry Can Help • Share risk & responsibilities • Maximize collaboration -teaming • Share best practices • Infuse technology • Enable best value solution • Recognize depots have improved

  16. Summary • High visibility, fast pace, new territory • Opportunities often require a tailored approach • Intelligent partnering can result in cost effective support within statute, policy, and strategies

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