Defense Acquisitions: Prices of Marine Corps Spare Parts Have Increased: NSIAD-00-123

July 2000
GAO Reports;7/31/2000, p1
Government Document
This is the first in a series of reports examining price trends of spare parts managed by the military. This report contains information on reparable spare parts the Marine Corps uses to maintain ground combat and support equipment such as vehicles, radars, and radio receivers. It addresses (1) changes in the prices of reparable parts compared with the prices of similar items in the private sector and the reasons for the price changes and (2) the accuracy of prices set by the Marine Corps. Prices of the 703 parts examined increased by an average of 14 percent over the four-year period from fiscal year 1995 through 1999, while prices for similar items sold in the private sector dropped by 0.2 percent. During the four-year period, prices fluctuated, dropping 10 percent during the first 2 years and increasing by about 27 percent during the last 2 years. The Marine Corps did not follow Defense pricing regulations in setting prices and, as a result, the prices of most parts sold to Marine Corps customers were incorrect. The approach used to adjust prices of repaired parts from year to year was inconsistent with Defense regulations and led to wider price fluctuations. The Marine Corps has taken steps to correct its method for setting prices.


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