This has been a Project of Concern since 2009-10.

Cost Performance

The project remains within current approved budget. As a result of the commercial settlements reached in November 2009 and April 2011, the Commonwealth received compensation from Boeing for costs incurred as a result of project delays and radar performance shortfalls. Payments are being made in accordance with the revised payment schedule.

Schedule Performance

As at 30 June 2010, the Commonwealth had accepted three aircraft in an initial configuration, available to the Air Force for training and initial operations. A fourth aircraft was accepted in the initial configuration in December 2010. Boeing failed to deliver the first aircraft in a final operational configuration in December 2010, as agreed in the settlement reached in November 2009.

Boeing planned to deliver additional increments of aircraft capability in June 2011, however this was delayed one month. The first aircraft in a 'final' configuration, capable of supporting all operational tasking short of high-end war fighting is scheduled for delivery in March 2012, in which case the total delay to this milestone against the original contract baseline would be 64 months. However, Defence assesses that there is 3 months risk to this date.

Materiel Capability Performance

A United States Operational Utility Demonstration was conducted in Hawaii in July 2010 as part of Exercise RIMPAC. This demonstration was important in order to assess the operational readiness of the AEW&C capability. The demonstration concluded that the Wedgetail AEW&C has outstanding potential, but that the integrated system and some subsystems are still maturing.

The Wedgetail test aircraft participated in the Canadian exercise, Trident Fury, during May 2011. The flights showed varying success, with some radar fixes flown showing excellent results. However, there were still issues with system stability, consistency and repeatability which undermined overall mission system utility. Some individual sub systems proved to have developed considerably since the RIMPAC Exercise, but integrated mission system was still immature.

Electronic Support Measures (ESM) remains the most significant concern and schedule risk. Reliability, maintainability and supportability are the key ESM issues that have been highlighted during recent testing. The resolution of these ESM issues will be a primary driver of Final Acceptance.

The Commonwealth and Boeing are working together to resolve the significant capability risks that need to be retired in the mission systems, communications and integration areas. Three System (Software) Builds will be released to the Commonwealth in accordance with a revised schedule to Final Acceptance agreed in the April 2011 commercial settlement.