A powerful voice within the American defense industry is urging the administration to implement far more aggressive changes to the federal acquisition process. In an official letter, a major aerospace association lauded the „significant steps” taken so far but emphasized that further effort is needed to achieve the vision of a faster acquisition process, with increased competition and superior results.
Call for Deep Reform: A Once-in-a-Generation Opportunity
This initiative comes as the Federal Acquisition Regulations (FAR) have not undergone a comprehensive overhaul since their initial implementation in 1984. This situation creates a „once-in-a-generation opportunity” to modernize and accelerate the process. „We think that they’ve done some really, really great things in there. But again, this is a really rare opportunity to attack some of those requirements that are most burdensome,” stated an association representative. „That’s what we try to identify in this letter — where can we go further in streamlining those requirements that really are the ones that add to the timelines, and that are the ones that disincentivize certain elements of industry from participating.”
Of the five recommendations listed in the letter, two stand out for their potential impact on simplifying the acquisition process.
Bureaucratic Obstacles: Why Companies Hesitate
The first recommendation calls for the administration to drastically streamline the requirements for industry to submit cost and pricing data. Industry has long argued that these requirements—which force companies to disclose detailed information about the cost of goods and services so that the government can ensure fair pricing—are overly burdensome. This leads to some companies choosing not to work with the government.
Although a revised version of the FAR proposed by the government attempts to address this by directing contracting officers to „obtain the type and quantity of data required to establish a fair and reasonable price, but not more data than is needed,” the association believes this guidance is not specific enough. It recommends a comprehensive review of the language surrounding cost and pricing to streamline regulations down to only what is strictly required by law. „It is one of those single levers that, if streamlined, would really make a very significant impact on shortening procurement timelines and enabling the process to move faster,” the representative emphasized.
The other critical recommendation involves „allowable costs”—the term used to describe what costs are reimbursable by the government to a contractor. The association contends that the revised FAR does not „substantively change” the current framework, which forces contractors to absorb certain costs. This leaves it up to companies whether to invest their own funds in initiatives that could improve readiness and innovation.
For example, „there’s lots of calls from [Secretary] and other Pentagon leadership to industry to be able to surge production,” the representative explained. „But industry cannot put excess capacity costs on a federal contract. We’re literally prohibited from doing it. So it’s very frustrating for industry.”
A Vision for the Future: Collaboration and Simplification
In the letter, the association also makes recommendations aimed at enabling the procurement of commercial products and maintaining competition, as well as changes that could make it easier for contracting officers to understand and follow the new FAR.
The FAR overhaul, triggered by an executive order issued in April, comes as the Pentagon and congressional defense committees move forward with their own acquisition reform efforts. As the administration enters the formal rulemaking stage of the FAR overhaul, the association is currently formulating specific language that can be implemented for some of its recommendations, including for allowable costs and cost and pricing data.
„We would love for them to bring industry in and work on these two problems in particular, to come up with a proposed solution set prior to that formal rulemaking, so that we’re still leveraging all of this momentum that everybody has with the FAR overhaul to make really good progress here,” the representative concluded, emphasizing the urgency and importance of collaboration for national security.
