GE, Rolls announce end to engine development

The companies say they're giving up on their bid to pay themselves to build a second F-35 engine.

GE and Rolls-Royce’s “alternate engine” for the F-35 has looked dead for some time, but the corpse stopped twitching on Friday.

The companies announced they’re abandoning their effort to try to pay out of their own pockets to continue work on the engine, casting the move as a blow for “acquisition reform,” but prudent in light of “continued uncertainty” in the F-35 program.

Take a look at the full text of their announcement:

The GE Rolls-Royce Fighter Engine Team (FET) has reached the decision to discontinue self-funded development of the F136 engine for the Joint Strike Fighter (JSF) beyond 2011. The decision, reached jointly by GE and Rolls-Royce leadership, recognizes the continued uncertainty in the development and production schedules for the JSF Program.

“GE and Rolls-Royce are proud of our technology advancements and accomplishments on the F136,” said Dan McCormick, President of the FET. “However, difficult circumstances are converging that impact the potential benefit of an F136 self-funded development effort.”

With the F136 engine development almost 80 percent complete, the U.S. Department of Defense (DoD) terminated the program in April of this year. Following termination, the GE Rolls-Royce FET had offered to self-fund F136 development through fiscal year 2012, but will now end its development work. The FET will continue to fulfill its termination responsibilities with the federal government.

For 15 years, the FET has developed a competitive fighter engine for JSF with the world’s most advanced propulsion technologies, including numerous patented technologies from both companies. Before the program was terminated, six F136 development engines had accumulated more than 1,200 hours of testing since early 2009. The FET consistently delivered on cost and on schedule, and was rewarded with high marks by the DoD in a successful joint venture between GE and Rolls-Royce.

Throughout the F136 program, GE and Rolls-Royce have been leading advocates of defense acquisition reform – offering unique and aggressive fixed-price proposals for F136 production engines for the JSF program. “GE and Rolls-Royce are deeply grateful to our many Congressional supporters on both sides of the aisle over these many years as well as the military experts who have supported competing engines for JSF,” said McCormick. “We do not waver in our belief that competition is central to meaningful defense acquisition reform.”

DepSecDef Ash Carter reportedly got a formal pitch from GE and Rolls about self-funding earlier this fall, but clearly he did not find it compelling. DoD would have had to let the companies use some government testing facilities and equipment to carry on their work, even as they theoretically footed the bill, and Pentagon officials’ skepticism about the whole endeavor never really abated.

Competition is great, Carter told House lawmakers, in so many words — but it’s supposed to save money, not cost money. Letting GE and Rolls-Royce continue development on their own dime eventually would have meant bills for a program the Pentagon hated, and that was a non-starter going into the big crunch. So the companies are cutting their losses.

There are some loose ends and unanswered questions, though. How many special provisions from GE and Rolls’ congressional allies have made their way into the defense legislation of the past few years? There was talk of requiring in law that DoD always make testing facilities available to competing engine teams, and requiring “competition” in selecting the engines for the Air Force’s next-generation bomber. How much became real? Will those chickens come home to roost someday? It was hard to know immediately Friday how much of a legacy the F136 leaves behind after all the money and effort spent trying to sustain it.