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In this regard the Air Force generally would determine whether
lower prices could be negotiated.
The Air Force, by reviewing GENDYN's Fort Worth operation,
confirmed that there would be savings in a multiyear approach.
Based in part on the information it received in response to the
RFP, the Air Force submitted a justification package to Congress
in October of 1981, as required under the multiyear legislation.
Late in 1981, the Air Force decided it wished to purchase the
aircraft through a multiyear procurement. At that time, however,
Congress had not yet authorized the Air Force to proceed in that
manner. In addition, Congress had not amended the multiyear
legislation to increase the maximum allowable cancellation
ceiling to an amount above $5 million, a change that was
necessary to permit multiyear contracting for large contracts.
While awaiting congressional action to increase the maximum
allowable cancellation ceiling, on December 3, 1981, GENDYN and
the Air Force entered into the 480-aircraft agreement (Contract
2034). Contract 2034 concerned the production of 480 F-16
aircraft, 120 in each of the 4 program years 1982-1985. Contract
2034 was subjected to numerous modifications. Although it
provided for 480 aircraft to be delivered at a rate of 120 per
program year, GENDYN was authorized to perform work leading to
the delivery of all 480 aircraft.
Initially, money for the first year's production (1982) was
appropriated, along with funding for long-lead items and
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