STUDY OF AIR FORCE CONTRACT AF 33 (038)-18503 GENERAL MOTORS CORP.-BUICK-OLDSMOBILEPONTIAC ASSEMBLY DIVISION
SUBCOMMITTEE FOR SPECIAL INVESTIGATIONS
COMMITTEE ON ARMED SERVICES
HOUSE OF REPRESENTATIVES
EIGHTY-FIFTH CONGRESS
UNDER THE AUTHORITY OF
H. Res. 67
HEARINGS HELD JULY 22, 26, AUGUST 15, 16, 19, AND 21, 1957
Printed for the use of the Committee on Armed Services
SUBCOMMITTEE PROCEEDINGS No. 9
UNITED STATES
GOVERNMENT PRINTING OFFICE
WASHINGTON: 1957
SUBCOMMITTEE FOR SPECIAL INVESTIGATIONS
F. EDWARD HÉBERT, Louisiana, Chairman
Ambrose, John J., analytical statistician, Industrial Resources Divi-
sion, Air Materiel Command..
Corkum, Mrs. Alice S., buying assistant, Air Materiel Command..
Goebel, Howard D., administrative contracting officer, Air Materiel
Command, at Buick-Oldsmobile-Pontiac plant...--
Richmond, Milton, cost analyst, Air Materiel Command..
Saxton, Richard C., price analyst and chief negotiator in last segment
for Air Materiel Command__
Gordon, John F., vice president, General Motors Corp., Buick-
Oldsmobile-Pontiac division.......
Hammond, James H., Defense Accounting and Auditing Division,
General Accounting Office....
Haycock, S. P., Legal Division, General Accounting Office..
Lemley, William P., staff auditor, Air Materiel Command..
Loofbourrow, B. D., Deputy Chief, Pricing Staff Division, Air
Materiel Command..
Medberry, Col. J. R., United States Air Force..
Newman, W. A., Deputy Director, Defense Auditing and Accounting
Division, General Accounting Office...
Affidavit dated August 21, 1957.
Affidavit dated September 10, 1957.
Excerpt from letter, dated June 18, 1957, of General Motors Corp.,
to Comptroller General stating their position_...
Dated August 2, 1957, from Dudley C. Sharp, Assistant Secre-
tary of the Air Force, to the Comptroller General.......
Dated August 21, 1957, from A. F. Power to John J. Courtney--
Dated August 21, 1957, from Joseph Campbell, Comptroller
General of the United States, to Congressman Hébert.
Dated August 23, 1957, from John J. Courtney to A. F. Power..
Dated August 27, 1957, from John J. Courtney to A. F. Power..
Dated September 10, 1957, from A. F. Power to John J. Courtney
Dated October 14, 1957, from Comptroller General of the United
States to Congressman Hébert_
Dated October 14, 1957, from Joseph Campbell, Comptroller
General of the United States to the Attorney General of the
United States....
Dent, Fred R., Jr., major general, United States Air Force, to
General Motors..
Analysis of incurred cost through May 11, 1954.
Average unit cost of factory-completed airplanes_
Analysis of burden by quarters, period June 1, 1953, through end
of contracts__
2761
General Accounting Office comments re material costs..--- 2772, 2779, 2786
Gordon, John F., to Lt. Col. George W. Thompson, Pricing Staff
Division Deputy Director, Procurement Headquarters, Air Ma-
teriel Command, Wright-Patterson Air Force Base, Ohio, dated
August 10, 1957...
Letter:
Dated October 25, 1956, from General Motors Corp. to General
Thurman___
2595, 2726
Dated March 28, 1957, from W. E. Medcalf to General Accounting
Office_
2605
Dated April 26, 1957, from the Comptroller General to Harlow H.
Curtice..
2603
Dated June 3, 1957, from Joseph Campbell, Comptroller General,
to Harlow H. Curtice..
2606
Dated July 19, 1957, from Congressman Hébert to Joseph
Campbell...
2557
2849
2915
Letters, exhibits, etc.-Continued
Page
Loofbourrow, B. D., deputy chief, Pricing Staff Division, Air Materiel
2851
Command, Memorandum for the File, dated January 3, 1957-----
Purchase Order Revision (document) on order No. KDS 9328. 2918, 2796
Powers, Lawrence J., Director of Defense, Auditing and Accounting
Division, General Accounting Office:
Action taken by the Air Force, more effective pricing negotiations_
Administrative audits---
Known reductions in subcontractor's prices..
Refund requested from the contractor---
Spare parts for mutual defense assistance program.
Summary of price reductions which should have been attained_
Summary of profit contemplated and experienced....
Table of selected prices negotiated and profits realized..
Appendix A: Letter, dated March 28, 1957, from Dudley C.
Sharp, Assistant Secretary of the Air Force, to the Comptroller
General...
Letter, dated June 18, 1957, from John F. Gordon, to Joseph
Campbell, Comptroller of the United States.
Exhibit A: Letter, dated April 25, 1951, from H. H. Curtice
to Brig. Gen. Phillips W. Smith.
Exhibit B: Letter, dated May 9, 1951, from Brig. Gen.
Phillips W. Smith to H. H. Čurtice..
Exhibit C: Letter, dated August 13, 1951, from H.
H,
Curtice to Brig. Gen. Phillips W. Smith.
Exhibit D: Letter, dated October 25, 1956, from John F.
Gordon to Brig. Gen. William T. Thurman_
Exhibit E: Letter, dated June 27, 1956, from John F.
Gordon to the commander, Headquarters, Air Material
Command, Wright-Patterson Air Force Base.---
Appendix D: Letter, dated July 8, 1957, from Joseph Campbell,
Comptroller General to the Secretary of the Air Force..
Quotation in Aviation Week of part of testimony of Hon. Lee White,
Assistant Secretary of War, before a Senate subcommittee on
F-84F program.
Section 3-801.4, Air Force procurement instructions, entitled "Cost,
Profit, and Price Relationships".
Section 3-802.4, Air Force procurement instructions, entitled "Nego-
tiated Prices Versus Actual Cost and Profit"
Summary schedule (contract No. AF 33(038)-18503).
Telegram:
Dated July 26, 1957, from Congressman Hébert to Harlow H.
Curtice...
Dated July 26, 1957, from Harlow H. Curtice to Congressman
Hébert..
To John J. Courtney (2)
Thompson, Lt. Col. George W., United States Air Force, Chief,
Pricing Staff Division, Deputy Director, Procurement, Air Materiel
Command, memorandum dated August 13, 1957--
Vinson, Hon. Carl, Chairman, Committee on Armed Services:
Letter to, dated July 19, 1957, from Joseph Campbell..
Letter from, dated July 19, 1957, to Joseph Campbell...
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