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Analysis

Who owns the aircraft, and why it decides everything else

By Danny Crist Published 7 min read

COCO, GOCO and GOGO are answers to a sovereignty question, not procurement options. Ownership decides who holds airworthiness, who carries availability risk, who employs the crews and how fast the capability can start. It is the first decision in a program because every later decision inherits from it.

Contractor-owned contractor-operated. Government-owned contractor-operated. Government-owned government-operated. Three acronyms, usually presented as a procurement menu, usually decided late by whoever is writing the contract.

Decided late, it is the most expensive mistake available in this business. Ownership is not a commercial detail that gets settled after the capability is designed. It is the first decision, and every other decision inherits from it.

What each one actually buys you

Contractor-owned, contractor-operated buys speed. The aircraft exists, the crews exist, and capability can be flying in months rather than years. It also buys zero sovereign capability: when the contract ends, the aircraft leaves with the contractor and the customer is exactly where they started, minus the money.

That is not automatically wrong. For a surge requirement, a time-limited operation, or a government that wants to test whether airborne intelligence is worth investing in before committing capital, COCO is the correct answer and anything else is overbuying.

Government-owned, contractor-operated buys the asset now and the capability later. The customer holds title, which means the aircraft stays when the contract ends, and it means the customer carries the capital cost and the depreciation. The contractor operates and maintains while a local pipeline is built underneath.

This is the model most partner-nation programs should be using and relatively few are, because it requires the customer to commit capital up front and it requires the contractor to accept that the end state is their own removal.

Government-owned, government-operated is the end state, not a starting position. Almost nobody goes there directly, and the ones who try usually end up with aircraft they cannot crew and a ground station nobody is qualified to run.

The question that picks for you

Ask what happens in year six.

If the answer is “the requirement will be gone”, COCO is right and building sovereign capability is wasted money. If the answer is “we will still need this and we want to be running it ourselves”, then you are buying a GOCO with a defined transition to GOGO, and the contract should say so in those words with criteria attached.

The failure mode is a customer who wants the year-six answer and buys the year-one structure because it was faster to contract. They end up renewing a COCO arrangement indefinitely, paying operating margin on someone else’s aircraft, with no more capability in year eight than they had in year one.

The part that gets skipped

Whichever model is chosen, the training pipeline and the maintenance data package are what determine whether the model works. A GOCO with no transition criteria is a COCO where the customer also paid for the aircraft — the worst of both.

Write the end state into the contract. Define what the customer must be able to do unaided. Put a date on it. Everything else — airframe, sensor, ground segment, crewing — follows from that, and follows correctly.

Related capability

Sovereign Capability Development

Genuine capability development means your people continue to own and operate every aspect of the mission solution after we leave.

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