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GAO-03-278 Military Readiness: Civil Reserve Air Fleet Can Respond As United States General Accounting Office Report to the Chairman, GAO Subcommittee on Military Readiness, Committee on Armed Services, House of Representatives December 2002 MILITARY READINESS Civil Reserve Air Fleet Can Respond as Planned, but Incentives May Need Revamping GAO-03-278 December 2002 MILITARY READINESS Civil Reserve Air Fleet Can Respond Highlights of GAO-03-278, a report to the as Planned, but Incentives May Need Chairman, Subcommittee on Military Readiness, Committee on Armed Revamping Services, House of Representatives In the event of a national Civil Reserve Air Fleet participants can respond to an emergency or a war emergency, the Department of with the required number of aircraft and crews and within the required time Defense (DOD) can use frame. Currently, there are more aircraft committed to the fleet than are commercial aircraft drawn from needed to fill the wartime requirements identified in the DOD Mobility the Civil Reserve Air Fleet to Requirements Study 2005, which determined the requirements to fight and augment its own airlift capabilities. win two major theater wars. However, Civil Reserve Air Fleet requirements The Civil Reserve Air Fleet is a fleet of aircraft owned by U.S. may increase the next time mobility requirements are studied. The last commercial air carriers but mobility requirements study was limited in that it did not consider the use of committed voluntarily to DOD for excess Civil Reserve Air Fleet capacity and the ability of some commercial use during emergencies. aircraft to carry larger cargo than standard-sized pallets. After the terrorist attacks of The incentives currently in place to encourage participation in the program, September 11, 2001, many air especially the incentive to participate in DOD’s peacetime business, might carriers experienced financial be losing effectiveness and could become disincentives in the future. Some difficulties. This sparked concern participants are not able to bid on peacetime cargo business because about the fleet’s ability to respond, their fleets do not include B-747s, the predominant aircraft DOD uses for if activated, and prompted the peacetime cargo missions. GAO found that B-747s carried out 94 percent of Subcommittee to ask GAO to determine whether the fleet could 946 missions flown by commercial aircraft in the first 10 months of fiscal respond to an activation with the year 2002. Furthermore, over 40 percent of recent missions did not use all required number of aircraft and available space or weight limits aboard B-747s. These missions might have crews and in the required time been carried out less expensively with smaller wide-body aircraft. Using frame. The Subcommittee also smaller aircraft would provide more peacetime business to a greater share of wanted to know whether the program participants, thus enhancing current incentives. However, the Air incentives used to attract and Force does not have sufficient management information to identify options retain participants are effective. for selecting the best available aircraft type for the mission. Loading a B-747 at Dover Air Force Base, Delaware GAO is recommending that the next evaluation of mobility requirements include a more thorough study of Civil Reserve Air Fleet capabilities and that the Air Mobility Command study whether smaller wide-body aircraft could be used as efficiently and effectively as the larger B-747-type aircraft to handle DOD’s peacetime cargo business. DOD concurred with these recommendations. www.gao.gov/cgi-bin/getrpt?GAO-03-278. To view the full report, including the scope and methodology, click on the link above. For more information, contact Neal Curtin at (757) 552-8100 or [email protected]. Contents Letter 1 Results in Brief 2 Background 3 Conclusions 11 Recommendations for Executive Action 11 Agency Comments and Our Evaluation 12 Scope and Methodology 12 Appendix I Civil Reserve Air Fleet Participants and Total Number of Aircraft Committed at Stage III as of October 2002 14 Appendix II Department of Defense Commercial Airlift Contracts 15 Appendix III Comments from the Department of Defense 16 Appendix IV GAO Contacts and Staff Acknowledgments 18 Tables Table 1: Aircraft Committed to the CRAF Program by Stage and Type of Aircraft (as of October 2002) 4 Table 2: Stage III CRAF Requirements and Commitments (as of October 2002) 5 Table 3: Cost Comparison by Aircraft Type 10 Table 4: DOD Contracts for Commercial Airlift, Fiscal Years 1998-2002 15 Figures Figure 1: Loading a B-747 at Dover Air Force Base, Delaware 6 Figure 2: B-747 and MD-11 Cross-Section Views with Cargo Pallets 9 Page i GAO-03-278 Military Readiness Abbreviations AMC Air Mobility Command CRAF Civil Reserve Air Fleet DOD Department of Defense MRS-05 Mobility Requirements Study 2005 Page ii GAO-03-278 Military Readiness United States General Accounting Office Washington, DC 20548 December 30, 2002 The Honorable Joel Hefley Chairman, Subcommittee on Military Readiness Committee on Armed Services House of Representatives Dear Mr. Chairman: In the event of a national emergency, the Department of Defense (DOD) will face requirements for air transportation that exceed its military airlift capabilities.1 To meet additional requirements, DOD can use the Civil Reserve Air Fleet, aircraft from U.S. commercial air carriers voluntarily committed and put under contract to DOD for use during emergencies. The commercial air carriers receive no compensation for their participation in the Civil Reserve Air Fleet unless they are activated, but they are given an incentive to participate by being made eligible to bid for DOD’s peacetime airlift business. Air carriers are paid for missions they fly at predetermined rates based on a weighted average of their costs plus a return on investment. The Air Force’s Air Mobility Command at Scott Air Force Base, Illinois, manages the Civil Reserve Air Fleet program. Commercial air carriers experienced financial difficulties after the attacks of September 11, 2001. In your December 2001 letter, you expressed concern over the carriers’ ability to respond to the requirements of the Civil Reserve Air Fleet program in the event of an activation for an emergency or a war, including the ability to provide crews that do not have National Guard or Reserve obligations. As agreed with your office, we determined whether (1) program participants could respond to an activation with the required number of aircraft and crews and in the required time frame and (2) incentives used to attract and retain program participants are effective. To respond to your letter, we referred to the Mobility Requirements Study 2005, issued in January 2001, to determine the requirements for the Civil Reserve Air Fleet program. This study determined the airlift required to 1 The total capacity expressed in terms of number of passengers and/or weight/cubic displacement of cargo that can be carried at any one time to a given destination by available military airlift. Page 1 GAO-03-278 Military Readiness meet the former national military strategy of fighting and winning two major theater wars. It does not reflect the new Defense Planning Guidance, issued in May 2002, the new national security strategy, issued in September 2002, or the airlift needed to meet that strategy. Results in Brief Civil Reserve Air Fleet participants can respond to an emergency or a war with the required number of aircraft and crews and within the required time frame. Currently, there are more aircraft committed to the program than are needed to fill the wartime requirements identified in DOD’s Mobility Requirements Study 2005. Participants stated that they would be able to provide the required numbers of crews despite layoffs in the industry after September 11, 2001, even though some crewmembers have National Guard or Reserve commitments that would prevent them from flying for the Civil Reserve Air Fleet if it were activated. However, Civil Reserve Air Fleet requirements may increase the next time mobility requirements are studied. The last study was limited in that it did not consider excess Civil Reserve Air Fleet capacity and the ability of some commercial aircraft to carry larger than standard-sized cargo pallets, which could increase the amount of cargo the fleet is expected to carry. The incentives currently in place to encourage participation in the program might be losing effectiveness and could become disincentives in the future, according to some program participants. Civil Reserve Air Fleet participants with 62 percent of the wide-body cargo aircraft in their fleets are not able to bid on peacetime cargo business because their fleets do not include B-747s, the predominant commercial aircraft DOD uses for peacetime cargo missions. DOD usually requests aircraft with the capacity of a B-747 because it carries more weight and can be loaded with a standard-sized pallet that also fits on military aircraft. We found that B-747s carried out 892 of 946 missions (94 percent) flown by commercial aircraft in the first 10 months of fiscal year 2002. Furthermore, over 40 percent of recent missions did not use all available space or weight limits aboard B-747s. These missions might have been carried out less expensively with smaller wide-body aircraft. Using these smaller wide-body aircraft would also provide more peacetime business to a greater share of program participants. However, the Air Force does not have sufficient management information to identify options for selecting the most efficient and economical aircraft type for the mission. To ensure that mobility requirements are met in the most effective and economical manner, we are recommending that DOD fully assess Civil Reserve Air Fleet capabilities in any new mobility requirements Page 2 GAO-03-278 Military Readiness studies. To enhance the effectiveness of Civil Reserve Air Fleet program incentives, we are recommending that the Air Mobility Command study the option of optimizing its use of aircraft other than B-747s for peacetime missions.
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