After a decade of multibillion-dollar cost overruns and delays in delivering satellites, it seems the U.S. Air Force can claim that it has finally averted a potential disaster—at least for now—on its next big satellite program.

The precision navigation and timing (PNT) payload for the first of a new generation of Global Positioning System (GPS) satellites will be delivered 10 months late to prime contractor Lockheed Martin. But, because the Air Force crafted the GPS III program with an eye toward upfront risk reduction, a much longer and more costly delay may have been avoided, according to industry officials. The first satellite is still slated for on-time delivery in May 2014, says Keoki Jackson, vice president of Lockheed Martin’s navigation business.

ITT Exelis, a longtime manufacturer of PNT payloads, is crafting these units for GPS III. The payload for the first GPS satellite is now expected for delivery at the end of the summer, Jackson says. “There were performance shortfalls in the engineering hardware, he says. “We were taking a very close look at the signals that come out of the payload and making sure the signal performance was as expected.” The problem was that the power emitted in the various signals being broadcast by the payload needed to be shifted. Rick Ambrose, executive vice president of Lockheed Martin Space Systems, says this effectively amounted to crosstalk among the signals.

“This is not your GPS of previous” iterations, says Chris Young, executive vice president of ITT Exelis Geospatial Systems, noting that his company has had a hand in every GPS payload ever fielded. “As you stuff more together [into a payload,] the problems we are finding are exactly what you would expect to see.” They were discovered during planned testing, and fixes are being implemented, Young says. The next step will be to ensure the fixes are producible, as the original GPS III plan called for buying up to 30 satellites.

Lockheed has sent engineering and management support employees to ITT’s facility to help work on the fixes.

“We are about four-and-a-half years into the program and believe we are 14-15 months from being ready,” says Ambrose. Jackson says Lockheed Martin is committed to beating the 7.5-year time from contract award to launch of legacy GPS IIRM satellites. GPS III is expected in a total of six years. And, other company officials say that although they have exceeded the target cost in the cost-plus development contract, they are still within the price allocated in the Air Force’s budget.

But Lockheed and ITT Exelis are not sanguine about the delay, officials from both companies insist that the use of the GPS testbed satellite was crucial in avoiding a much larger holdup. The Air Force opted to include the manufacture of a testbed, non-operational pathfinder that is assembled on the actual production line ahead of the fabrication of the first satellite. This was part of a “back to basics” procurement strategy when Lockheed won the $1.5 billion contract in 2008. This included development and production of the GPS III testbed and first two space vehicles.

Lockheed is determined to proceed on schedule in order to discourage the government from shopping for another supplier. Lockheed’s win effectively put Boeing out of the GPS business for an entire generation.

Fiscal pressure on the defense budget means, however, that “everything is on the table,” says Air Force Space Command chief Gen. William Shelton, noting that the service cannot necessarily commit to a long-term buy now. “To keep that confidence, Lockheed Martin needs to deliver. It is as simple as that,” Jackson says.

While the first satellite awaits its payload, Lockheed Martin has been doing as much bus testing as possible so as not to waste time.

The GPS nonflight satellite testbed (GNST) is now about three months from completing its pathfinder work for the first tranche of GPS III satellites, Jackson says. It is now in the final stages of trials in the anechoic chamber. Lockheed Martin hopes to have completed a run-through of pre-launch processing activities at Cape Canaveral in the third quarter of the year. The pathfinder will complete its task when it has been used for demonstrating stacking and pre-launch integration.

Then, the GNST will be used as a testbed for a series of upgrades that would be included in Space Vehicles 9 and beyond. Key assets included in this next set of GPS III satellites are the capability to “dual launch” the spacecraft from United Launch Alliance Atlas V rockets, an advanced search-and-rescue payload, and digital waveform generators that allow for signal upgrading after a satellite is launched, Jackson says. Work on these technologies is in the formative stages. The Air Force is considering buying as many as 12 of these satellites, but a strategy has not yet been refined.

A long-desired “spot-beam” capability that would allow for a high-power signal, impervious to current GPS jamming, has been dashed for now. This spot beam was originally eyed for a third block of satellites, and it could come back into play in a later tranche.