Summary: Pursuant to a congressional request, GAO reviewed the Department of Defense's (DOD) implementation of a statutory requirement that it obtain warranties on weapon systems.
GAO found that: (1) the 1985 DOD authorizing legislation required it to obtain guarantees that procured items would conform to contract requirements and be free from defects; (2) DOD significantly increased its use of warranties in response to the legislative requirement; (3) the military services requested few warranty waivers; (4) most warranties contained performance guarantees; and (5) the DOD procurement activities that it visited paid about $244 million for 61 warranties that had specific prices. GAO also found that: (1) the services had prepared cost-effectiveness analyses for only 9 of the 97 warranties that it reviewed, despite a DOD regulation requiring such analyses; (2) warranties could be more specific regarding performance requirements, performance assessment, and potential corrective actions; (3) DOD could better define warranty duration periods; and (4) only 23 of the 97 warranties included provisions requiring physical markings of warranted items.
