Thursday, October 27, 2011

No such thing as 'too big to fail'

The "T-word" has been mentioned by the vendor in relation to the F-35. T for "termination.

Glowing statements abound for LM's latest financial report but the truth is that there are serious money problems with the F-35 program.

Over $60 billion later (this includes JSF efforts from pre-2001) and no example of a tested and complete go to war aircraft.

For those looking at history, we could have won WWII twice; the F-16 would have already been in operational squadron service; and we would have had a few trips to the moon under our belt.

But this is the new world of groupthink and real engineers (or engineering leadership) no esta en la casa.

It is rather amusing to be told that flight testing for the F-35 is going well yet in reality it is still delayed when compared to this 2007 schedule.

A sign of poor leadership is not taking ownership of a project.

“It is distinctly argued that a discovery in the program is not a deficiency or a fault of the contractor … These discoveries are not defects. They are a part of a learning process that is a very well established facet of an engineering system like this.”

Not true. Poor risk management; poor engineering leadership; gross over optimism; and concurrency warnings ignored.

The misleading statements didn't help either.

Those investors that haven't woken up might want to consider doing so now.

New t-shirts for the program are available.


nico said...

I agree Eric, sure seems to me with LMT statements that they are passing the buck of responsibility and have "certain" people try to shift the blame on the gvt. Last time I checked it was LMT designed, I am pretty sure I saw a LMT logo at one point or two on a JSF during the program. Why should we the taxpayer take on the entire cost of the so called learning processes?

g said...

One of your most clever F-35 blog entries, in my opinion.

On the issue of passing the buck to Gov though, no question LMT deserves and is starting to receive a hard lesson learned from the flawed JSF Program. A good lesson learned will be by the shareholders too. They'll likely not be so giddy and quick to cheer on such a pyramid-like-perpetuating and grossly optimistic mega-scheme. You might just get the directors of the board to raise a hand or two too. But what one might not want to see equally so, is an attempt by USG to do a CYA and try to confuse the issue by merely pointing fingers. That dilutes their absolute share of accountability for pushing ahead in the first place and implementing such an unsustainable and flawed project.

Although, even with LMT taking on what I believe are only the REC flyaway cost overrun share(??), the Total Procurement Cost overruns would I assume continue to be picked up by the Services - at the expense of liquidating other assets ABOVE and BEYOND significant asset liquidations via budget cuts in the imminent future.