ICBM cost overrun a ‘collective failure’ of USAF, Northrop, DOD: Air Force’s chief buyer

Even if Boeing had stayed in the competition to build the Air Force’s next intercontinental ballistic missile, the program probably would’ve still run over budget because the acquisition strategy was flawed to begin with, according to the service’s acquisition chief.

Some critics have argued that the Sentinel program’s massive cost overruns—81 percent beyond initial estimates—flowed largely from the U.S. government’s 2018 decision to allow Northrop Grumman to acquire one of just two large domestic rocket-motor producers. Boeing cited this “unfair” advantage when it dropped out of the ICBM contest the following year, leaving the Air Force with no choice but to award Northrop a sole-source contract. 

But on Wednesday, Andrew Hunter said the overruns were caused primarily by the decision to focus the competition on the missile itself, treating hugely complex launch facilities and other infrastructure as afterthoughts.

“I don't know that if Boeing had stayed it would have been meaningfully fixed, because the [request for proposal]—really, an acquisition strategy—essentially laid out this approach, structured this approach to the program that was kind of missile-first, and missile-focused in terms of the competitive dynamics between the two providers. So I think it starts with the Air Force, but it was a failure that was collective,” Hunter, who is assistant Air Force secretary for acquisition, technology and logistics, said at a conference hosted by Defense News. 

Asked whether this collective included the Air Force, Northrop, the Office of the Secretary of Defense, and the Pentagon acquisition community, Hunter responded: "all of the above.” 

“Obviously, we have to take responsibility as the Air Force, because it's an Air Force program. So it starts with the Air Force, I'll be perfectly honest about that. But having said that, we weren't the ones who made a mistake and made the same mistake. And so it was definitely something that happened as a collective we," he said.

The entire Sentinel program is being restructured after its costs soared to $141 billion, breaching the Nunn-McCurdy Act threshold. Pentagon officials are still moving ahead with the program, arguing that there are no better alternatives to replacing the aging Minuteman missiles. 

The Air Force is now going through the program’s requirements “line by line” to find places to drive down costs, Gen. James Slife, the Air Force vice chief of staff, said Wednesday. It’s an “exhaustive process” that will be going on for “months and months,” he said.

The Pentagon rescinded Sentinel’s Milestone B decision until the program gets restructured. The program will come up with a new acquisition strategy, which could take up to two years because it’s a very complex undertaking and “this is our chance to get it right,” Hunter said. 

“The last time we did this was roughly 75 years ago, and so we're having to re-learn some of those skills and up our game in that respect, and also bring a lot more engineering focus on the ground infrastructure. And ultimately, what that will enable us to do is restructure the program, and by restructure the program, change our design for the ground infrastructure to be simpler, more affordable, we’ll work closely together with the operational committee on the requirements to make sure we're still doing what it takes to deliver nuclear deterrence, but in an affordable way,” Hunter said. 

In July, Hunter told reporters that the service was considering stripping Northrop of some of Sentinel construction work and putting it up for bids again. 

“I think there are elements of the ground infrastructure where there may be opportunities for competition that we can add to the acquisition strategy for Sentinel,” he said.

No decision has yet been made on that, an Air Force spokesperson said recently. 

“As the Air Force develops an acquisition strategy for a restructured program, it will have to determine if any changes to the Sentinel program’s contracts and contracting strategy are necessary,” the spokesperson said.