REDUCING THE DEFICIT: SPENDING AND REVENUE OPTIONS
Congressional Budget Office - March 1997


DEF-09 CANCEL THE UPGRADE OF THE NAVY'S F/A-18 FIGHTER AND BUY THE CURRENT MODEL

Annual Savings							Five-Year
Savings from		(Millions of dollars)			Cumulative
the 1997 Plan		1998	1999	2000	2001	2002	Total


Budget Authority	1,812	2,116	2,233	1,654	2,410	10,225

Outlays			  252	  932	1,630	1,886	1,943	 6,643


NOTE: The Administration, in its 1998 budget request, has revised its plan for this system. Appendix A shows savings against the 1998 plan.

For the foreseeable future, the F/A-18 aircraft will account for the bulk of the Navy's fleet of carrier-based aircraft that perform fighter and attack missions. The F/A-18 attacks targets both in the air (the fighter mission) and at sea or on the ground (the attack mission). The current version of the F/A-18 is designated the C/D model.

In 1991, the Navy announced plans to develop a new E/F variant of the F/A-18. The E/F version features several modifications: a longer fuselage, a larger wing, and a more powerful engine than are now on the C/D version. Those changes should enable the E/F to carry a larger load of weapons than the C/D, or to carry a combat load about 40 percent farther. Both attributes are important factors in determining the plane's capability in the attack role. The new engine should also enable the heavier E/F aircraft to retain the speed and maneuverability of the earlier version, important performance considerations in fighter combat. McDonnell Douglas Corporation, the plane's manufacturer, also points to the lowered signatures of the E/F, billing the plane as the Navy's first fighter aircraft with low observable characteristics. Such characteristics increase the likelihood that planes will survive to perform their missions.

Though more capable, the E/F version will also be more expensive than the C/D model--about 39 percent more by some estimates--and the Navy will have to pay about $0.4 billion from 1998 through 2002 to complete development of the plane. This option would cancel development and procurement of the new E/F model and instead would buy sufficient additional C/D aircraft to maintain the Administration's planned production rates. Compared with the 1997 plan, savings in budget authority would total about $1.8 billion in 1998 and $10.2 billion over five years. Savings from the 1998 plan would be about the same. Savings from canceling the upgrade might be larger if the F/A-18 experienced unanticipated cost increases.

The requirement for an upgraded F/A-18 aircraft may be questionable in view of today's reduced military threat. The threat to carrier battle groups stemmed largely from the former Soviet Union, and the possibility of conflict with the former Soviet republics now seems increasingly remote. Regional powers are not likely to be able to match the capability of current U.S. fighters for many years. But if the enhanced fighter capabilities offered by the E/F version are not needed, neither may be its added attack capabilities, based on the Navy's judgments about other systems. The Navy is retiring its venerable but longer-range A-6 fleet and has canceled development of a new longer-range replacement, the A/FX, at least in part because the service now places less emphasis on the deep strike mission and more on supporting Marine forces that operate at relatively short ranges from the ships that transport and support them. Such reservations about whether F/A-18 E/F enhancements are needed may have led the Marine Corps, which also flies the F/A-18, to question whether it would pursue E/F purchases or keep buying the current model.

Even if the added capabilities of the E/F model are needed, trends in the F/A-18 program suggest that they may be hard to achieve. Some critics of the program have noted that the A/B model of the F/A-18 attained only about 75 percent of the originally specified goal for the fighter's range, and the C/D model achieved only about 70 percent.

Canceling the E/F development program would have some disadvantages. Even in conflicts with smaller nations, improvements in the F/A-18's range might be useful in the attack mission; indeed, critics of the C/D version believe its relatively short range limits its usefulness. Moreover, now that the A/FX has been canceled, the E/F upgrade will be the only major upgrade the Navy will purchase for its fighter fleet at least through the middle of the next decade.