GAO

United States General Accounting Office

Report to the Secretary of Defense

August 1999 UNMANNED AERIAL 

VEHICLES

DOD’s Demonstration 

Approach Has 

Improved Project 

Outcomes

GAO/NSIAD-99-33

Page 1 GAO/NSIAD-99-33 Unmanned Aerial Vehicles

United States General Accounting Office

Washington, D.C. 20548

National Security and

International Affairs Division

B-276812 Letter

August 30, 1999

The Honorable William S. Cohen

The Secretary of Defense

Dear Mr. Secretary:

The Department of Defense (DOD) needs Unmanned Aerial Vehicles (UAV) 

for surveillance and reconnaissance missions. Since the end of the Vietnam 

War, DOD began at least nine UAV acquisition programs that were later 

canceled, spending $4 billion in the process.1

 (See app. I.) In 1994, as part 

of its acquisition reform efforts, DOD adopted an Advanced Concept 

Technology Demonstration (ACTD) strategy for assessing UAVs.2

 We 

reviewed current UAV projects to determine whether DOD’s strategy of 

conducting ACTDs before developing and producing UAVs provides an 

improved knowledge base for making acquisition decisions. DOD has 

completed ACTD projects for the Predator and Outrider UAV systems and 

has an ongoing ACTD for the Global Hawk UAV. DOD terminated a fourth 

UAV project, DarkStar, before its ACTD was completed.

Results in Brief The ACTD strategy of focusing on mature technology and proving military 

utility before committing to a UAV has expanded DOD’s knowledge base, 

allowing it to make some well informed acquisition decisions. For 

example, when DOD began the Predator ACTD in 1994, the Predator was 

considered technologically mature because its design was based on an 

existing UAV, the Gnat 750. Nevertheless, DOD still required that the 

Predator’s performance be demonstrated. Prototypes of the Predator were 

deployed in Bosnia in 1995 and 1996, allowing users to determine whether 

the UAV would meet their needs. Only after this performance data was 

gathered and analyzed in 1997 was DOD willing to formally commit to the 

UAV’s acquisition.3

 In another case, the ACTD for the DarkStar UAV, DOD 

1

The canceled programs were Compass Cope, Compass Dwell, Aquila, Amber, Condor, Hunter, Raptor, a 

classified program, and the Medium Range UAV. 

2

ACTDs are carried out to demonstrate, within 2 to 4 years, that a technologically mature system has 

military utility before DOD formally commits to develop and produce it.

3

Defense Acquisition: Advanced Concept Technology Demonstration Program Can Be Improved

(GAO/NSIAD-99-4, Oct. 15, 1998).

Letr
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gained knowledge early on that led to its decision not to acquire that 

system. Likewise, for the same reason, DOD decided not to acquire the 

joint-service Outrider UAV on a sole-source basis. DOD’s ACTD approach 

to UAV acquisition is consistent with the best practices of leading 

commercial developers, which require proof of technological maturity and 

performance before they will develop or produce a product.4

On the other hand, DOD’s formal acquisition process, used during its earlier 

UAV efforts, allowed programs to proceed with much less knowledge (and 

thus higher risk) of technologies, design, and potential production 

problems. Problems with development and production, along with the 

associated cost and schedule increases, were a predictable consequence of 

proceeding on such limited knowledge. For example, when DOD 

committed to the Aquila UAV in 1979, the system was not technologically 

mature. Several of Aquila’s key planned subsystems—such as a 

miniaturized jam-resistant data link and a day-night sensor with laser 

designator—did not even exist at the time. As a result, by 1982, in large 

part due to numerous problems in developing subsystem technologies, 

Aquila development costs had almost quintupled, and the schedule had 

slipped 27 months.5

 Nevertheless, DOD continued the program until 1987, 

when, after spending more than $1 billion, it terminated Aquila.6

Background UAVs are pilotless aircraft used in reconnaissance and surveillance and in 

the identification, location, and designation of targets. A UAV system 

includes one or more aircraft, a launch and recovery system, and a ground 

station for flight control. During the Vietnam War, target drones were 

modified to carry cameras and were used extensively for intelligence 

gathering missions, avoiding risk to manned aircraft.7

 After the war, DOD 

began several UAV programs to capitalize on these demonstrated 

4

Before proceeding into product development, leading commercial firms require that technology 

development be complete. They also place a premium on demonstrated performance. See Best 

Practices: Successful Application to Weapon Acquisitions Requires Changes in DOD’s Environment

(GAO/NSIAD-98-56, Feb. 24, 1998).

5

Results of Forthcoming Critical Tests Are Needed to Confirm Army Remotely Piloted Vehicle’s 

Readiness for Production (GAO/NSIAD-84-72, Apr. 4, 1984).

6

Aquila Remotely Piloted Vehicle: Its Potential Battlefield Contribution Still in Doubt

(GAO/NSIAD-88-19, Oct. 26, 1987).

7

The terms “drone” and “unmanned aerial vehicle” can be used interchangeably to refer to remotely 

controlled aircraft.

Letr
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capabilities. However, nearly all these UAV programs were terminated 

before reaching completion.8

DOD initiated its ACTD program in 1994 as an acquisition reform initiative 

to lower system costs and reduce acquisition time, and DOD modified its 

UAV acquisition strategy to incorporate the ACTD approach. The approach 

responded to the recommendations of the 1986 Packard Commission, 

which was created to review defense acquisitions and determine how 

weapon systems could be made faster and at lower cost. The Commission 

recommended, among other things, that prototypes be built and tested to 

assess military utility and provide a basis for realistic cost estimates before 

a commitment to acquisition is made. We reported in October 1998 that the 

ACTD approach can potentially cut a weapon system’s development and 

acquisition time.9

ACTD Results Provide 

Better Basis for 

Decisions

ACTD results provide DOD with a better basis for making UAV acquisition 

decisions. DOD has completed ACTD projects for the Predator and 

Outrider UAVs. On the basis of the knowledge it gained during these 

demonstrations, DOD committed to acquiring Predator UAVs and chose not 

to acquire joint-service Outrider UAVs on a sole-source basis. Additionally, 

because of performance and cost concerns, DOD terminated the ACTD 

project for the DarkStar UAV before its demonstration was completed.

Predator Demonstrated in 

Bosnia Before Commitment 

to Production

When DOD began the ACTD for the Predator UAV in 1994, its technologies 

were considered mature because the aircraft was based on an existing UAV, 

the Gnat 750, which had been developed previously for the Central 

Intelligence Agency. DOD nevertheless required that the Predator’s 

performance be demonstrated to ensure it would meet user needs before 

DOD committed itself to acquiring the system. Predator prototypes were 

deployed in Bosnia in 1995 and 1996 as part of the ACTD. The performance 

8

The one exception, the Navy and the Marine Corps’ Pioneer, was not acquired through the formal DOD 

process but was procured directly from a joint venture of Israeli and U.S. firms. When it deployed 

Pioneer on Navy ships, DOD had to spend considerable time and money resolving a number of 

significant problems. See Unmanned Aerial Vehicles: Realistic Testing Needed Before Production of 

Short-Range System (GAO/NSIAD-90-234, Sept. 28, 1990).

9

Defense Acquisition: Advanced Concept Technology Demonstration Program Can Be Improved

(GAO/NSIAD-99-4, Oct. 15, 1998).
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data gathered there convinced military users that Predator was worth 

acquiring.

The Predator effort began with a 30-month ACTD contract awarded in 

January 1994 for 3 systems and 10 air vehicles. Predator’s mission is to 

provide long-range (500 nautical miles), long endurance (more than

20 hours), near real-time imagery to satisfy reconnaissance, surveillance, 

and target acquisition requirements. These capabilities were demonstrated 

in Bosnia. The demonstration also identified some problems such as the 

UAV’s inability to see through cloud cover and icing of its wings in cold 

weather. However, the contractor incorporated solutions, including a 

synthetic aperture radar and a wing de-icing system. Predator systems are 

now in production, and the Air Force has had Predator UAVs deployed in 

two reconnaissance squadrons: one in Hungary supporting operations in 

Bosnia and one in Nevada.

Outrider ACTD Allowed 

DOD to Avoid Unwise 

Commitment

In our 1997 report on the joint-service Outrider ACTD, we concluded that 

DOD had underestimated the time and effort needed to successfully 

integrate nondevelopmental items into the Outrider prototype.10 In 1998, 

after a 2-year effort, the Outrider ACTD was completed. The ACTD 

demonstrated that the Outrider prototype did not exhibit the necessary 

military utility for its expressed objective of meeting the combined tactical 

UAV requirements of the Army, the Navy, and the Marine Corps. The Navy 

then withdrew from the project in favor of pursuing a vertical take-off and 

landing UAV system, although on the basis of the knowledge gained during 

the ACTD, the Army determined that Outrider had sufficient military utility 

to continue as a competitor for the Army’s tactical UAV solution. However, 

DOD determined there was not enough justification to continue in a solesource arrangement with the Outrider system. Rather, DOD directed the 

Army to conduct a full and open competition for a tactical UAV system.

The objectives of the joint Outrider ACTD included determining whether 

the UAV could (1) operate for 3 to 4 hours at a range of 200 kilometers, 

(2) be transported on one C-130 cargo aircraft, (3) operate on automotive 

gasoline, and (4) be used aboard ships. These objectives were not met. The 

demonstration showed that Outrider (1) had a 200-kilometer range for only 

2 hours, (2) needed two C-130 aircraft to transport it, and (3) required 

10Unmanned Aerial Vehicles: Outrider Demonstrations Will Be Inadequate to Justify Further Production

(GAO/NSIAD-97-153, Sept. 23, 1997).
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aviation fuel. The demonstration of shipboard operations was not 

attempted. Moreover, the demonstration results showed no evidence that 

Outrider could achieve two longer-term objectives: replacing its analog 

data link with a digital one and installing a heavy fuel engine.

Better Knowledge Base 

Allowed DOD to Terminate 

DarkStar ACTD Early

DOD terminated the DarkStar ACTD in January 1999, well before the 

planned completion date, after it was determined that DarkStar was not 

aerodynamically stable and not meeting cost and performance objectives. 

The ACTD required the contractor to demonstrate that the UAV had 

military utility and that future production versions could be built for 

$10 million each. By requiring that DarkStar demonstrate its ability to meet 

military requirements before a commitment to acquisition was made, DOD 

was able to acquire knowledge about cost and performance relatively 

quickly compared with the time usually needed under the formal 

acquisition process. 

DarkStar was meant to be a stealthy, high-altitude reconnaissance UAV to 

be used in high threat environments. It was expected to reach an altitude 

of 50,000 feet, have a range of 500 nautical miles, and be able to operate for 

8 hours. The first prototype crashed on its second flight in 1996. 

Correcting the design problems that had caused the crash became 

expensive and time consuming. In December 1998, we reported that DOD 

projections showed that the unit price for future production versions of 

DarkStar would be about $13.7 million, well above the $10 million goal.11

Global Hawk High-Altitude 

Endurance ACTD Is 

Progressing

The Global Hawk high-altitude endurance ACTD is progressing toward an 

October 2000 program decision point. At that time, DOD will have 

completed a military utility assessment of Global Hawk and hopes to have a 

sound knowledge base for deciding whether to convert the UAV to a formal 

acquisition program. Global Hawks have flown more than 135 hours and 

have reached altitudes in excess of 66,000 feet. By the end of our review, 

four prototype Global Hawks had been built. The Air Force was scheduled 

to formally begin assessing the Global Hawk’s military utility in April 1999 

for the ACTD sponsor, the U.S. Atlantic Command, but this assessment was 

delayed by a crash.

11Unmanned Aerial Vehicles: Progress in Meeting High Altitude Endurance Aircraft Price Goals

(GAO/NSIAD-99-29, Dec. 15, 1998).
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DOD pursued several programs for a high-altitude, long-endurance UAV 

through the 1960s and 1970s without successfully fielding such an aircraft. 

The Global Hawk is considered technologically mature because many of its 

components are adapted from other proven aircraft. It is intended to reach 

altitudes of 65,000 feet, have a range of 3,000 nautical miles, and conduct 

reconnaissance missions for more than 24 hours. According to DOD’s plans 

for airborne reconnaissance, high-altitude UAVs such as Global Hawk 

would initially augment and eventually could replace manned aircraft in 

performing high-altitude intelligence gathering missions.

ACTD Approach Consistent 

With Commercial Best 

Practices 

DOD’s approach to acquiring UAVs using the ACTD process is consistent 

with the focus on mature technology and proving performance that we 

found in our 1998 review of leading commercial development efforts. 

Commercial firms make a distinction between technology development 

and product development, and they demand proof of performance before 

committing to production.

The purpose of technology development is to foster technological advances 

for potential application to a product. Product development in commercial 

ventures is a clearly defined undertaking aimed to design and manufacture 

an item that the customer needs and wants. The process of discovery—the 

accumulation of knowledge and the elimination of unknowns—is 

completed for the best commercial programs well ahead of commitment to 

development of a product. Immature or undeveloped technology is kept 

out of commercial product development programs.

Prior UAV Acquisitions 

Accepted Significant 

Unknowns

In contrast to the ACTD approach, DOD’s formal acquisition process allows 

technology development to continue after product development has begun. 

As a result, the distinction between technology development and 

development of an individual product is much less clear. Consequently, 

DOD may have much less knowledge about technologies, design, and 

potential production problems when it commits to development or 

acquisition of a product. Problems with development and production, 

along with the associated cost and schedule increases, are a predictable 

consequence of such limited knowledge.

Under previous programs, accurate data of a UAV’s performance, military 

utility, and cost was not generally available when DOD made a commitment
B-276812

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to acquisition.12 As a result, DOD spent far more than it anticipated and 

obtained far less than it expected in terms of capabilities. Examples 

include DOD’s acquisition efforts for the Aquila, Pioneer, and Hunter UAV 

systems. 

Aquila Several planned key subsystems of the Aquila UAV did not exist when DOD 

committed to developing the Aquila in 1979. These included a modular 

integrated communication and navigation system, an anti-jam data link, 

and a forward-looking infrared payload and laser designator. After about 

4 years, Aquila development costs had grown from $123 million to 

$590 million, and numerous problems with subsystem development had 

stretched the development schedule from 43 months to 70 months.13

Nevertheless, DOD continued until 1987, when operational testing revealed 

that the Aquila did not meet requirements. Ultimately, after spending 

8 years and $1 billion in development funds, the Army terminated the 

program.

Pioneer DOD also committed to acquire the Pioneer UAV in the face of significant 

unknowns. Subsequently—but only after the Navy and the Marine Corps 

had begun taking delivery of Pioneer systems—numerous problems 

emerged, requiring extensive investment of resources to solve.

Before deciding to acquire Pioneer UAVs, the Navy acquired several Mastiff 

UAVs from Israel for Naval Gunfire Support while expediting a 

procurement program for Pioneer. The Navy, however, wanted Pioneer to 

be adapted so it could take off from and land on ships. No performance 

data on how the Pioneer design would accommodate shipboard 

requirements was collected before an acquisition decision was made. 

Thus, Pioneer immediately began to encounter problems. Recoveries 

aboard ship and electromagnetic interference from other shipboard 

systems led to a significant number of crashes. The Pioneer also suffered 

from numerous other shortcomings. Ultimately, the Navy was forced to 

spend $50 million in research and development to bring nine Pioneer 

prototypes up to a level of “minimal essential capability.” Although 

12Unmanned Aerial Vehicles: DOD’s Acquisition Efforts (GAO/T-NSIAD-97-138, Apr. 9, 1997).

13Results of Forthcoming Critical Tests Are Needed to Confirm Army Remotely Piloted Vehicle’s 

Readiness for Production (GAO/NSIAD-84-72, Apr. 4, 1984).
B-276812

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Pioneer’s performance never met its original requirements, the Navy and 

the Marine Corps were able to use the improved Pioneer systems in the 

Persian Gulf War and more recently in Somalia, Bosnia, and Yugoslavia.

Hunter The Hunter UAV program entered production in January 1993, before its 

performance had been tested under realistic conditions.14 Seven Hunter 

systems, at a cost of $171 million, were already being built when testing 

disclosed serious problems with engines, software, equipment, and logistic 

support.15 After spending an additional 3 years and a total of about 

$700 million on the program, DOD chose not to contract for further 

production of Hunter. The seven existing Hunter systems are now 

deployed in contingencies such as Yugoslavia, are being used for testing 

and training, or are in storage.

Conclusions By taking an ACTD approach that focuses on mature technology and 

proves performance and military utility before acquisition, DOD is basing 

its UAV acquisition decisions on an improved body of knowledge. The 

approach is also consistent with best commercial practices, which place a 

premium on demonstrated performance when deciding whether to develop 

a new product. As we have previously reported, DOD’s standard 

acquisition process did not provide the same level of data and knowledge 

under previous UAV programs.

Agency Comments DOD partially concurred with a draft of this report. DOD stated that 

although the draft report was favorable to the UAV ACTD process, it did not 

outline critical factors that led to DOD’s decision not to pursue Outrider 

UAV acquisition. We have made changes in the body of this report to reflect 

DOD’s concerns. DOD’s comments are reprinted in appendix II. Additional 

technical comments from DOD have been incorporated as appropriate.

14Unmanned Aerial Vehicles: Performance of Short Range System Still in Question (GAO/NSIAD-94-65, 

Dec. 15, 1993).

15 Unmanned Aerial Vehicles: No More Hunter Systems Should Be Bought Until Problems Are Fixed

(GAO/NSIAD-95-52, Mar. 1, 1995).
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Scope and 

Methodology

To determine whether the ACTD approach provides an improved 

knowledge base for making UAV acquisition decisions, we reviewed and 

analyzed the history of DOD’s previous UAV acquisition efforts and the 

results of two completed UAV prototype demonstrations, for Predator and 

Outrider. We also reviewed the DarkStar High Altitude Endurance UAV’s 

history and the status of the ongoing Global Hawk High Altitude Endurance 

UAV ACTD project. We observed flight tests and reviewed test reports. We 

interviewed DOD, Air Force, Army, Marine Corps, and Navy requirements, 

acquisition, and testing officials; service user representatives; and 

contractor officials. In addition, we leveraged from our past and ongoing 

work in the area of best practices.

We performed our work at the offices of the Secretary of Defense, the Air 

Force, the Army, the Marine Corps, and the Navy in Washington, D.C.; the 

UAV Joint Projects Office, Patuxent River, Maryland; the Air Force Air 

Combat Command, Langley Air Force Base, Virginia; the U.S. Atlantic 

Command, Norfolk, Virginia; the Army Training and Doctrine Command, 

Fort Monroe, Virginia; the Air Force Aeronautical Systems Center, 

Wright-Patterson Air Force Base, Ohio; the U.S. Army, 15th Military 

Intelligence Battalion, Fort Hood, Texas; the 304th Military Intelligence 

Battalion, Fort Huachuca, Arizona; the U.S. Air Force, 11th Reconnaissance 

Squadron, Indian Springs, Nevada; the U.S. Marine Corps, Pioneer 

Company at 29 Palms, California; and at various contractor facilities.

We performed our review from April 1997 to May 1999 in accordance with 

generally accepted government auditing standards.

We are sending copies of this report to Senator John Warner, Chairman, and 

Senator Carl Levin, Ranking Minority Member, Senate Committee on 

Armed Services and Representative Floyd Spence, Chairman, and 

Representative Ike Skelton, Ranking Minority Member, House Committee 

on Armed Services. We are also sending copies to the Honorable Louis 

Caldera, Secretary of the Army; the Honorable Richard Danzig, Secretary of 

the Navy; the Honorable F. Whitten Peters, Acting Secretary of the Air 

Force; and the Honorable Jacob Lew, Director, Office of Management and 

Budget. Copies will also be made available to others upon request
B-276812

Page 10 GAO/NSIAD-99-33 Unmanned Aerial Vehicles

Please contact me on (202) 512-4841 if you or your staff have any questions 

concerning this report. Major contributors to this report were Michael 

Aiken, Terrell Bishop, Terry Parker, and Charles Ward.

Sincerely yours,

Louis J. Rodrigues

Director, Defense Acquisitions Issues
Page 11 GAO/NSIAD-99-33 Unmanned Aerial Vehicles
Page 12 GAO/NSIAD-99-33 Unmanned Aerial Vehicles

Appendix I

Unmanned Aerial Vehicles Program 

Cancellations Through 1996 ApenxIdi

Source: Defense Airborne Reconnaissance Office.

Program Dollars spent (approximate)

Compass Cope $200 million

Compass Dwell 200 million

Aquila 1 billion

Amber 200 million

Condor 400 million

Medium Range 210 million

Special Program 1 billion

Raptor 200 million

Hunter 700 million

Total $4.1 billion 
Page 13 GAO/NSIAD-99-33 Unmanned Aerial Vehicles

Appendix II

Comments From the Department of Defense ApenxIdi

See comment 1.

See comment 1.

Note: GAO comment 

supplementing those in the 

report text appear at the 

end of this appendix.
Appendix II

Comments From the Department of Defense

Page 14 GAO/NSIAD-99-33 Unmanned Aerial Vehicles
Appendix II

Comments From the Department of Defense

Page 15 GAO/NSIAD-99-33 Unmanned Aerial Vehicles

The following is GAO’s comment on the Department of Defense’s (DOD) 

letter.

GAO Comment 1. We have made changes in the body of this report to reflect DOD’s 

concerns.

(707245) Lret
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