I think the fact that the Air Force did not want to develop a price increment for that reflects their confidence in the wing. They had participaed with us for a number of years on redesign of that wing. I don't think I am putting words in DOD officials' mouths to say they were very confident, based on the design and the component testing at that point and simply felt a warranty was inappropriate.

When you buy an automobile or other consumer product we are often offered an extended warranty. Many times we don't take it. I think the Air Force felt it would not be in their best interest to do that.

POST-WING MODIFICATION WARRANTY OF C-5

Senator EAGLETON. If we assume from that answer that you are confident as to the efficiency or the efficacies of the wing modification process, and if the Air Force is as well confident that whatever the defects were they have now been remedied, why wouldn't it be the most prudent thing to have a warranty in connection with it, since it was the greatest single source of concern from the outset with the C-5?

Mr. ORMSBY. I think the answer to that is a warranty is not needed since the wing was designed to give 60,000 test hours and we are now past 95,000 hours with no difficulty, no structural problems. So the point has been made that the wing is perfectly satisfactory.

Senator EAGLETON. Why would it be of great potential cost to your company to give a warranty if in fact you and the Air Force are so confident as to the success of that which has been done?

Mr. ORMSBY. In testing anything and judging its use you have to assume some kind of base. Most of us, if we read the warranties carefully, the warranty is good provided that, and there are a whole bunch of details. We have to take it to the dealer every 30 days, it should not be used to pull trailers, et cetera, et cetera, et cetera.

So the cost of keeping track of the use of the airplanes has to be factored in. The fact that the Air Force, as we testified earlier, frequently use the airplanes in ways you can't foresee, make the provision of commercial warranties in a military situation very difficult to quantify.

All I can say is we agreed as to the use of the airplane most likely to set up test profiles and the wing has met that. It will probably go beyond 95,000 hours, which is more than three lifetimes.

Senator EAGLETON. Let me move on to another subject.

Senator Mattingly specified that certain functions in contrasting the C-5 with the 747 and I would like to ask you three questions in comparing the flexibility or greater utility of the C-5 as contrasted with the C-17.

Is it not true that the C-17, vis-a-vis the C-5, would have a larger cargo capability for outsize cargo?

Mr. ORMSBY. I do not believe so. The payload on the C-5B at two and a quarter G is 271,000 pounds.

Senator EAGLETON. Capability for outsize cargo?

Mr. ORMSBY. Yes, sir.

Senator EAGLETON. The C-17 does not have a greater capability? Mr. ORMSBY. I don't believe so. In the C-5 today, you can carry two M1 main battle tanks tied down and equipped for combat. They weigh about 130,000 pounds apiece, times two is 260,000 pounds. It is my belief that the C-17 is not capable of that.

Senator EAGLETON. How about the C-17 as compared to the C-5 landing on a smaller, more austere runway?

Mr. ORMSBY. If you confine it to the hard surface, the C-17 is smaller, it has less capability. We might note, however, that the C5, if allowed to taxi off the runway, which you saw in the film, has certain capabilities the C-17 does not have, because the wheel loading on the C-5 is less than the C-17 and it is actually less than the C-141 and C-130.

Senator EAGLETON. Have the C-17 versus the C-5, in terms of parking on the ground and handling greater facility-greater facility in handling of aircraft once they blend?

Mr. ORMSBY. If you take a specific area, a C-17 can get on smaller paved surface, but the C-5 has demonstrated that you can take it off the paved surface. The C-17 can be loaded through one opening only. So anything driven on the C-17 must be backed off. The C-5 on the other hand, has openings at both ends, so the load can be driven on and when you arrive at the field the load can be driven off in less time.

There is no question about it, the C-17 has certain advantages attendant to its design and concept. It is somewhat designed in a different set of criteria. To say one is better than the other is very difficult.

Senator EAGLETON. My final question, if I may, Senator Andrews from North Dakota at yet another hearing on this subject matter referred to this question and answer from a GAO report and I would like your comment.

C-17/C-5 AVAILABILITY

The question was: "What did the McDonnell-Douglas data show on availability of the C-17 versus the C-5?”

Here is GAO's answer:

Lockheed proposes to deliver the first C-5 38 months after contract go-ahead. They plan to develop the 12th aircraft 56 months after the go-ahead.

With full C-5 program TOA devoted to the C-17 McDonnell-Douglas asserts that the C-17 could make first flight 40 months after contract go-ahead and could deliver the 12th aircraft 56 months after go-ahead.

So as I read this from this report, at the end of 56 months both Lockheed and McDonnell-Douglas would be able to deliver the 12th aircraft. The only difference insofar as the GAO's analysis is concerned, is Lockheed, the first C-5 would be 38 months after contract, and with McDonnell-Douglas' C-17 it would be 40 months after contract for the first aircraft.

Do you have any reason to dispute that answer by the General Accounting Office?

Mr. ORMSBY. Those statements are correct as they stand, but they need another paragraph. I think we need to reflect that when the first C-5 comes off the line, as soon as you shake it down it

goes to operational units and are available that day, that week. When the first C-17 comes off the line it goes into a flight test program. Depending upon the difficulties in flight testing it can take upward from a year to go through all of the tests. After that, the Air Force typically builds a training squadron, puts together 16 airplanes, assembles a training syllabus, teach mechanics how to service the airplane, and

So simply comparing when the two planes come out the respective plant doors is not an accurate reflection of when they are ready to put into use. I would submit that for the C-17 it would be 2 to 4 years longer. We are producing an airplane in an interrupted production phase. It is not a new airplane.

C-17/C-5 COMPARABILITY

Senator EAGLETON. If I could take 10 seconds to tidy up an earlier question. I don't know if I understood you or you understood me on the question of the comparability of the C-17 versus the C-5 on outsize cargo. I will put it very directly.

Can the C-17 handle two M1 tanks and the C-5 can handle but one?

Mr. ORMSBY. It is the other way around. The C-5 can carry two, the C-17 can carry one.

Senator EAGLETON. That is all I have.

Senator STEVENS. The C-5 can carry two? We were told for wing loading they carry one?

Mr. ORMSBY. The current fleet with the old wing, in an attempt to maximize its economic life, for normal routine peacetime operations does have restrictions on the airplane. If a whistle were to blow and this country went to war, those restrictions will be totally lifted and the airplane would carry its original design payload.

Through the good management of the Air Force and Military Airlift Command they have already generated a service life bank, if you will, in the airplane to permit it to supply NATO or fulfill a NATO contingency. So the limitations that are frequently talked about the C-5 are peacetime routine kind of mission restraints. Today's C-5 would carry two main battle tanks.

Senator STEVENS. Well, I don't really have the time to go into that, but what will be the initial operating capability of your C5B—incidentally, we have never seen a C-5B either, have we? We have not seen a C-17, but not the C-5B either?

Mr. ORMSBY. The C-5B exists if you look at the current modified airplane, you are seeing most of it. There are other changes that are being put into the C-5B in terms of avionics and electronics that would not be visible. If you look at the current new winged airplanes you could not distinguish it from our C-5B. There would be nothing visibly different about it.

Senator STEVENS. I am referring to the delay in terms of the C17 on the training squadrons. Nobody is training in the C-5B?

Mr. ORMSBY. There is already a training squadron in service and in place for the C-5. The airplanes are so similar we don't need a new training squadron.

Senator STEVENS. What would be your IOC if we have funds in the 1983 year?

Mr. ORMSBY. Basically our schedule calls for delivery of the first airplane 38 months after contract go-ahead. That is day by day. Whenever the contract is signed, we will deliver the first one 38 months later and it will go directly into operational service.

Senator STEVENS. And 56 on the 12th?

Mr. ORMSBY. We will deliver all 50 in the next 38 months after the first delivery.

Senator STEVENS. Thank you very much. We appreciate your testimony.

Mr. ORMSBY. Thank you for the opportunity.

MCDONNELL-DOUGLAS CORP.

STATEMENT OF MR. SANFORD N. McDONNELL, CHAIRMAN OF THE BOARD, MCDONNELL-DOUGLAS CORP.

ACCOMPANED BY:

MARVIN D. MARKS, CORPORATE VICE PRESIDENT/ENGINEER

JOE VAN DYKE, GENERAL MANAGER, C-17

HEARING PROCEDURE

INTRODUCTION OF ASSOCIATES

Senator STEVENS. The next witness is the McDonnell-Douglas Corp., Mr. Sanford N. McDonnell, chairman of the board, and Mr. Marvin D. Marks, corporation vice president and engineer.

Mr. MCDONNELL. Sanford McDonnell, I go by the nickname of Sandy. I am chairman of the board of directors of McDonnell-Douglas and chief executive officer.

Appearing with me today is Mr. Marvin Marks, corporate vice president of research who until recently was the vice president and general manager of the C-17. On his left is Mr. Joe Van Dyke, general manager of the C-17 who was the driving technical forcer behind the AMST YC-15 development and the current C-17 configuration development.

In response to the subcommittee's invitation to appear, we appreciate this opportunity to answer your questions regarding the C-17. Senator STEVENS. I want to state that all of us, the members have already left, are involved in another hearing that is very critical in another committee. We are going to go ahead and hear the testimony of McDonnell-Douglas and then we will have to recess and come back and hear the project director of the project on military procurement. That will be at 1:00 o'clock.

Now, it may be that we will be called up there before we can ask you gentlemen the questions. I don't mean to inconvenience you, but it may be we need to ask you if you could come back at 1:00 o'clock to continue the question hour also. But we will see how long that goes.

Thank you very much. It is nice to see you.

Mr. MCDONNELL. I think we are going to show just a few viewgraphs. Without turning out all of the lights, could we just have these lead lights out? I think that will be enough.

Can you see that all right?

Senator STEVENS. Yes sir.

CONTRIBUTION TO AIRLIFT REQUIREMENTS

For over 60 years McDonnell-Douglas has been preeminent in the development and production of commercial and military aircraft. We gave the world its first practical military transport aircraft and for 38 continuous years have produced the free world's finest jet fighter aircraft. It was in this tradition after more than a decade of preparation we entered into the Air Force C-X competition.

For some time the Air Force, the Army, and the Marines have been stating that existing airlift was seriously inadequate to meet mobility requirements by conventional war strategy. We have participated in an earlier response to this need as the designer of the AMST YC-15.

Senator STEVENS. I think we have some complaints from the television people about lights.