Contractor's Performance on the Family of Medium Tactical Vehicles Program.

Abstract : This report is the second of three reports addressing the acquisition of the Family of Medium Tactical Vehicles (FMTV). The first report addressed the Army's conditional acceptance of incomplete vehicles. This report addresses certain matters concerning the Contractor's performance and the Army's funding of the FMTV Program. The Army's medium tactical vehicle inventory, which consisted of approximately 95,460 2-1/2-ton and 5-ton vehicles, was costly to maintain and operate. Also, the 2-1/2-ton vehicle had key operational limitations. The Army planned to modernize the medium tactical vehicle inventory through the FMTV Program. The FMTV Program features non-developmental items whereby existing commercial components are modified as required and integrated into vehicles intended to meet military needs. The FMTV Program was structured to acquire 85,401 medium tactical vehicles by FY 2021. The Army estimated that the total cost of the Program would be $16.3 billion (then-year dollars). In October 1991, the Army awarded a 5-year, firm-fixed-price contract, valued at $1.2 billion, to Stewart and Stevenson Services, Incorporated (the Contractor), for the production of 10,843 vehicles. As of June 30, 1995, the FMTV Program was about 18 months behind schedule. Audit Objectives. The overall audit objective was to evaluate the Army's efforts to produce and field medium tactical vehicles. The audit was made using the Inspector General, DoD, critical program management element approach for a system in the production and deployment phase of the acquisition cycle. We also evaluated the adequacy of management controls related to the program management elements.