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![handle is hein.gao/gaobaawpg0001 and id is 1 raw text is:
DOCUMENT RESUME
04927 - [ B01950891
[Opportunity foi the bepartment of Defense To Save $1.6 Million
on Contracts for Aircft Logistics Support]. ESAD-76-68;
B-169217. January 18, J978. 3 pp. + enclosure (6 pp .
Report to Secretary, Department of Defense; by Richard U.
Gutmann, Director, Procurement and Systems Acquisition Div.
Issue Area: Federal Procurement of Goods and Servi,.es (1900);
Facilities and ateiial Management: Federal Transportation
of Things (74);'kilitary Preparedness Plans: .ogistic
Support Planning-fbr Major Equipment (801).
Co-.tact: Prrcurement ana Systems Acquisition v.
Budget Fu;,ction: Nat3ll&I Defense (050); National Defense:
Department of Deginise - Procurement & Contracts (058).
Orqanization Concern. Department ot the Air Force.
There is an-opportunity to save about $1.6 million
a-nu ally on logistiqs S6pport contracts for the Air Force's
commercially designdo_'oeing 737 and McDonnell Dougla.3 DC-9
aircraft. Savings of.abbut $640,000 annually have already been
achieved on two cont., acs. but significanit additional savings
are possible. Findings/Conclusiohs: The Air Force operates and
maintains coimercially designed Boeing 737 and McDonnell Douglas
DC-9 aircrait and pla'ns to purchase McDonell Douglas DC-10
aircraft. Logistics sUpport for the present fleet is provided
throuqh contracts witbhthe aircraft manufacturers. In proposing
the additional purchases, the Air Force testified that it vas
also considering obtaining the necessary logistico support for
the new aircraft by contract. Review of the present logistics
support contracts revealed costly provisions which should be
avoided in future contracts. One support provision which exceeds
demonstrated needs and normal commercial practice provides for
payment of inctntive fees for maintaining spare parts support at
a much higher level than aircraft usage varrants. The second
provides for three full-time field service representatives as
technical advisors a.t each aircraft station--a support level far
in excess ot normal commercial practice. The recurring cost of
these two provisions-was about $2.3 million in fiscal year 1976
for the five contraq t examined. Recommendations: The Secretary
of the Air Force should remove the spare parts support incentive
fee from remaining contracts as soon as possible and should
reevaluate the need tor the continued use oi technical
representatives before renewing this provision in the resaining
contracts. (SC)](ViewImageLocal?handle=hein.gao/gaobaawpg0001&div=1&collection=&method=preview&ext=.png&size=3)