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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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