Half of McDonnell’s C-17 Cargo Jet Tools Defective : Defense: The Air Force ordered an inspection after it found that quality assurance records had been altered. The C-17 program may have serious cost problems because of the tools’ flaws.

More than half of the tools built by McDonnell Douglas for production of C-17 cargo jets were found to be faulty after Air Force officials ordered a special sample inspection last year, it was learned Thursday.

Air Force officials ordered the inspection after they discovered that quality assurance records for the C-17 tools had been altered, according to an Air Force statement issued Thursday in response to an inquiry by The Times. As a result, the Air Force ordered the firm’s Douglas Aircraft unit in Long Beach to reinspect all of the C-17’s master tools, the devices that ensure that the aircraft will be built to precise dimensions.

The disclosures raise serious questions about whether the C-17 production program that is just getting under way will have cost problems--a critical issue that comes amid a Pentagon review ordered by Defense Secretary Dick Cheney of the C-17’s cost and military justification.

The Air Force has been planning to buy 211 of the big cargo transport planes for a total of $37.5 billion, roughly $178 million each, including design costs, development, initial spare parts and future inflation. But the service is reevaluating that cost estimate and is expected to disclose during coming congressional hearings a whopping increase of up to $4.5 billion in the program, primarily owing to changes in future inflation assumptions.

Critics charge that the cost increases are not the result of inflation adjustments, but that production foul-ups are driving up costs. A member of the House Armed Services Committee staff said there is growing concern about the cost of the C-17 as the Air Force prepares the new estimate.

“This program has major problems,” an Air Force official in the Pentagon said, requesting anonymity.

The official noted that major problems in electronic systems, including the flight-control system and aircraft mission computer, have delayed the program. In addition, Lockheed, which is building the C-17’s wings under subcontract, has had major cost increases in its work.

A Douglas spokesman said last week that the company’s C-17 program manager was not available to be interviewed. Also, Douglas officials first indicated that no tooling inspection was going on, but they later acknowledged the existence of the inspection program. Late Thursday, a Douglas official said he did not believe that any C-17 parts have been produced with uninspected tools.

The tone of the Air Force statement and confidential interviews with a Douglas Aircraft supervisor on the C-17 project left little doubt that the company has serious problems with the tooling. The term tooling refers to massive structures, some three stories tall, that must be built to tolerances as small as three one-thousandths of an inch. The tools hold the aircraft parts in place while each plane is being assembled.

“The assembly tooling is in a mess,” the supervisor said. “The head of C-17 tooling was transferred, and nobody has been named to replace him.”

He noted that Douglas has assigned 95 hourly workers, who are putting in significant amounts of overtime, to re-examine the tools. The Air Force statement indicated that the task is only half complete.

The Douglas supervisor blamed the tooling problems on bad engineering drawings and on the hiring last year of several hundred British toolmakers, many of whom, he said, knew little about advanced U.S. toolmaking techniques. The British toolmakers were recruited after Douglas said it was unable to find enough U.S. toolmakers for the program.

Some of the British workers are still at the Long Beach plant, the supervisor said.

The Air Force became concerned with the issue last year when “an altered tooling quality record was observed. This particular record was cut and taped. It was the (Air Force plant representative’s) opinion that there were strong indications that there were other quality records with similar anomalies,” the Air Force statement said.

A joint Air Force and Douglas inspection of other records indicated that “inadequate quality record maintenance/practices were prevalent throughout the C-17 tooling fabrication area.”

As a result, the Air Force and Douglas agreed to each select one tool out of thousands used on the C-17 line to randomly determine whether they were faulty. “Both tools were found to be substantially out of drawing tolerances,” the statement said. “If the product had been produced utilizing these tools, the result would have been the fabrication of nonconforming hardware.”

After the inspections were completed, Douglas officials argued that the results were “isolated incidents.” The Air Force sought at that point to have a 100% inspection of every tool but, as a “concession” to Douglas, it agreed to inspect only a sample of 32 master tools, the statement said.

By July 12, 23 tools had been inspected and 12 were found to be “discrepant,” the Air Force statement said. The following day, Douglas acknowledged the sample to have been a “failure” and announced that it would reinspect every C-17 master tool and other tools, as well.

In an interview last year, Douglas tooling supervisors said the C-17 project involves 20,000 fabrication and assembly tools. It was not clear Thursday how many of the master tools used to verify tolerances of all of those tools will have to be checked.

Air Force Brig. Gen. Michael Butchko, C-17 program manager, acknowledged in an interview earlier this week from his office at Wright-Patterson Air Force Base in Ohio, that there were problems with the C-17 tooling but that they were being corrected.

Butchko said, “We did find some discrepancies in Douglas quality control.” Otherwise, he said, “I think overall we are doing very well.”

Butchko said Douglas has eliminated 15,000 pounds of excess weight on the C-17, but that the aircraft is still at least 2,000 pounds overweight. It will weigh “270,500 pounds plus or minus 2,000 pounds,” he said.

However, he added, the plane will miss a contractual requirement that it be capable of transporting 167,000 pounds of cargo over 2,400 miles. Douglas will miss that specification by 100 miles, he said.

But an Air Force analyst at the Pentagon critical of the C-17 noted that with that range the aircraft will not be capable of flying unrefueled from Dover, Del., to the Azores with its 167,000 pounds of payload. He also differed with Butchko on the weight, saying that the aircraft was originally planned to weigh only 235,000 pounds.