Product lines are discontinued when the economic factors for their continuance are unfavorable. As the market shifts to a new technology, demand is reduced for earlier models and configurations and the cost for supporting the technology escalates. Suppliers must either raise the price (to maintain profit margins and offset reduction in demand) or terminate the product line. Accepting price increases or diminished availability as the supplier eliminates the remaining inventory are poor choices for the customer. In the end, customers pay significantly increased sustainment costs and are eventually forced to upgrade or replace systems with newer technologies. This is referred to as Diminishing Manufacturing Sources (DMS).
To fully understand the DMS concept, examine the life cycle of technology. Just like living things, technology goes through a development life cycle: birth, maturity, illness, death, and replacement. All commercial technologies go through a similar cycle; only the length of the cycle varies. This section and the resources below deal with Diminishing Manufacturing Sources and Material Shortages (DMSMS), defined as: the loss, or impending loss, of the last known manufacturer or supplier of raw materials and other critical components for production or repair parts. DMSMS problems are an increasing concern as the service lives of DoD weapon systems are extended and the product life cycle for high technology components decrease.
Defense Acquisition University (DAU) Acquisition Community Connection Web site for DMSMS: https://acc.dau.mil/dmsms