General Dynamics Corporation and Subsidiaries - Page 61

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          question that relatively substantial savings were experienced               
          through the multiyear feature of Contract 2034.  The cost savings           
          constituted the Air Force’s principal motive for seeking a                  
          multiyear contract.                                                         
               Petitioner believed it could achieve substantially higher              
          profit rates under a multiyear contract than it could otherwise             
          achieve under four annual contracts.  Petitioner also believed it           
          could achieve substantially higher sales volume of the aircraft             
          under the multiyear approach of Contract 2034.  Petitioner’s                
          agreement to a multiyear contract instead of continuing annual              
          contract procurement was also dependent upon expectations that it           
          would obtain increases in the sales volume of aircraft to                   
          customers other than the U.S. Government.  Finally, petitioner              
          viewed the multiyear form of procurement as providing stability             
          to its F-16 production and operations over the term of a 4-year             
          contract.                                                                   
               6.  The Customary Business Practices of the Air Force and              
          Petitioner                                                                  
               Respondent argues that, in negotiating Contract 2034, the              
          Air Force and GENDYN (hereinafter the parties) made a concerted             
          effort to adjust the rates of periodic progress payments and                
          liquidations so as to provide petitioner with the same economic             
          results as it would have realized had Contract 2034 been four               
          separate procurement contracts.                                             






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