47 research outputs found
Estimates of Unit Cost Reductions of the F-16 Fighter as a Result of U.S. Arms Export Production
The article of record as published may be found at http://dx.doi.org/10.1080/1941658X.2013.766547Arms exports have increasingly become an attractive option for reducing escalating unit costs of new
weapon systems to the United States Department of Defense. However, while there is no lack of conjecture,
there is little data that show weapon system costs to the United States actually decrease when
the same weapon is sold to a foreign buyer. The authors use the sale of the F-16 multi-role fighter
aircraft to foreign nations as a case study to quantify the financial gains realized through learning
and economies of scale attributed to export production. Using a rate-adjustment cost improvement
analysis, the authorsâ case study shows the unit costs the United States Department of Defense would
have incurred without the concurrent export production of F-16s. Estimates suggest that the production
savings resulting from export production were in excess of the research, development, test,
and evaluation costs of the F-16 for the period 1975 to 1991. The potential benefits associated with
keeping the F-16 production line âwarmâ through export production and the limits of applying the
findings to other weapon systems are discussed.Office of the Undersecretary of DefenseAerospace Industries Associatio