Pentagon Fails to Track $2.5 Billion in F-35 Parts

More than 17,000 F‑35 parts — an estimated $1.3 billion in components, and possibly up to $2.5 billion when missing cost information and acquisition expenses are included — were missing from the program’s inventory system as of March 2026, the Government Accountability Office found.

GAO’s central finding: large-scale inventory gaps and unclear financial exposure

The Government Accountability Office reported that the F‑35 Joint Program Office (JPO) could not reliably track thousands of spare parts undergoing maintenance or repair, leaving officials without a clear picture on the location of as much as $2.5 billion worth of components across the aircraft’s global supply chain. The watchdog said the gaps stemmed in part from incomplete contractor records that are not routinely integrated into the program’s inventory system.

“Without accurate data in its [accountable property system of record] and properly executed inventory procedures for F‑35 parts, DOD management will not have the information it needs to support warfighter readiness and reliable financial reporting,” the GAO said.

Enterprise Logistics Management System, Lockheed Martin, and Pratt & Whitney: a data interface problem

The Defense Department uses the Enterprise Logistics Management System (ELMS) to manage the F‑35’s inventory. While ELMS captures real‑time inventory changes, it cannot interface with property management systems run by Lockheed Martin and Pratt & Whitney. GAO first reported that interface gap in 2022, and the watchdog said it persisted as of August 2026.

Because of that lack of direct integration, the JPO relies on periodic contractor data submissions and other Pentagon systems to update ELMS. For the joint spare parts pool, submissions are quarterly, meaning some records can be more than three months old.

Data quality, inventory efforts, and unresolved loss accounting

GAO highlighted several evidence points of weak data quality and control. A December 2025 contractor submission included serial numbers for only 29 percent of parts records and National Stock Numbers for 43 percent. Some records listed component costs of one cent or less, which GAO said indicated possible data errors.

Since fiscal 2020 the JPO has spent at least $17 million conducting inventories, but GAO found the most recent effort did not fully verify that parts were physically in place or that inventory records accounted for all items. The watchdog also noted continuity problems in loss accounting: a 2023 GAO review had found that a prime contractor lost more than 1 million parts worth over $85 million between May 2018 and October 2022.

By March 2026 the contractor had submitted about $28 million in loss reports covering missing parts from 2012 through 2025; the Defense Contract Management Agency determined the contractor should be financially liable for about $6 million. GAO said the JPO could not determine whether those loss reports included the losses it identified earlier because the program office had not kept records of outstanding cases.

Operational consequences and program investments: the Global Support Solution Reset

GAO warned that accounting problems could affect the Pentagon’s ability to keep the F‑35 ready for operations. Without accurate inventory records, the department may struggle to determine which parts it needs and in what quantities.

That uncertainty could complicate the Pentagon’s $13.7 billion Global Support Solution Reset strategy, which calls for additional investment to improve F‑35 performance, including increasing spare parts availability. The watchdog cautioned the department may be unable to identify its needs or account for additional parts purchased under the strategy if inventory data remain unreliable.

How the F‑35 Joint Program Office, the Defense Department, and Lockheed Martin are responding

• F‑35 Joint Program Office: A JPO spokesperson told Breaking Defense the office was “actively working” on the issues GAO raised. The spokesperson said the JPO is developing new procedures and training for officials responsible for government‑owned property and is “modernizing its property management infrastructure by establishing direct, real‑time data interfaces between government and prime contractor systems.”
• Defense Department: The Pentagon agreed with all four GAO recommendations and said it was taking corrective actions. The Defense Contract Audit Agency is working with the JPO on a full inventory of F‑35 parts, targeted for completion in March 2027.
• Lockheed Martin: The company deferred questions to the JPO but said it is focused on “improving the stealth fighter’s readiness, affordability and sustainment.” A Lockheed spokesperson said the company “works closely with the F‑35 Joint Program Office, U.S. services, international customers, and industry partners to improve parts availability, repair turnaround times and supply chain performance.”

The GAO report also appears against the backdrop of a Pentagon investigation into how F‑35 components shipped from Australia to the United States ended up in Hong Kong, potentially exposing the jet’s secrets to the Chinese government. GAO did not link that incident to the inventory problems it documented, but the watchdog’s findings reinforce the broader challenge the JPO faces in maintaining accountability across more than 700 contractor‑ and government‑managed facilities and a supply base of roughly 1,900 domestic and 2,100 global suppliers supplying about 26 million parts.

GAO’s recommendations, the JPO’s modernization pledge, and the DCAA‑led full inventory set a clear timeline and checklist for corrective action: better data integration, stronger validation of contractor submissions, routine inventory verification that confirms physical presence, and clarified loss‑report oversight. The test will be whether the planned real‑time interfaces and the March 2027 inventory can close the gap between ELMS records and the sprawling, multi‑contractor reality of F‑35 sustainment — and whether that closure restores both operational planning certainty and reliable financial accounting.

https://breakingdefense.com/2026/11/pentagon-cant-track-thousands-of-f-35-parts-gao/