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National Defense > Blog > Posts > Navy Admiral: Rising Cost Threatens Future of Aircraft Carrier Fleet (Updated)

9/27/2012

Navy Admiral: Rising Cost Threatens Future of Aircraft Carrier Fleet (Updated)
By Dan Parsons



The biggest future threat to aircraft carriers might not be enemy weapons, but their own ballooning cost, said the Navy officer in charge of building the ships.

The new Gerald R. Ford class aircraft carriers are supposed to harness technological breakthroughs to drive down their total lifecycle cost below that of the Nimitz class ships they will replace.  But they are enormously expensive upfront.

Rear Adm. Thomas J. Moore, the Navy’s program executive officer for aircraft carriers, said cost must come down to preserve an 11-vessel fleet.

“The cost of the ship is probably a bigger challenge than missiles and mines and all the anti-access weapons out there,” Moore told National Defense Sept. 27 during an interview at his Washington Navy Yard office. “Cutting a ship … is enticing for the green-eye shade folks.”

Cutting a carrier not only saves on the initial cost of the ship, but on personnel, aircraft, training and a multitude of secondary costs that whet the appetite of budget hawks and policymakers.

But Moore said big deck carriers are here to stay, given the U.S. military’s strategic shift to the vast Pacific Ocean. He also offered the desire of countries such as China, India and Russia to build carriers as evidence that the huge ships are strategically imperative.

Nuclear-powered carriers are only built by one company in one place: Huntington Ingalls' Newport News Shipbuilding in Hampton Roads, Va. The situation creates a unique customer-supplier relationship in which both are mutually dependent. Shipyard officials acknowledge the creeping cost of the newest carrier and have pledged to bring it under control.

“We are building our prototype as the first production unit and there are many challenges that come with that,” Christie Miller, a shipyard spokeswoman said in an e-mail to National Defense. “Our efforts have been focused on bringing our customer value throughout this first-of-class ship design and construction project. We continue to see improvements on our performance on Ford.”

The USS Gerald R. Ford, CVN-78, currently being built is estimated to come in at around $12.9 billion. But $3.7 billion of that is non-recurring engineering cost associated with the Ford being a first-in-class vessel. Both shipyard and Navy officials insist construction cost will come down with each successive carrier in the class. CVN-79 will likely cost around $11 billion, Moore said. The following ships are expected to cost closer to $9 billion in 2008 dollars, he said.

Carriers are the single most expensive item the Defense Department buys. The new class, though every bit as costly as the preceding Nimitz class, offers long-term savings of $5 billion per ship, shipyard officials claim.

“Lifecycle cost is a significant reason we’re even building the Ford class,” Moore said.

Nearing structural completion, but only about half finished, CVN-78 has already suffered nearly $1 billion in cost overruns. Shipyard officials have attributed the inflation to hiccups associated with afirst-in-class build and problems with government-supplied technologies — like the new electro-magnetic aircraft launching system. Moore said the price of the Ford and succeeding ships has to come down and stabilize, or the argument to keep buying them with ever more scare procurement funds becomes less tenable.

When construction of CVN-79 begins, all of the materials and equipment will have already been purchased, so there will be “no excuses” for it to suffer the same setbacks as the Ford, Moore said. Late material has been a contributing factor to the Ford’s cost overruns, he said.

“We will have improved material availability on CVN-79, now that the design and prototypingof new systems and components for the class is nearly complete,” Miller said. “This will allow us to efficiently procure strategic components, consolidate multiple purchase orders into large, economic order quantities, and help us provide our suppliers a longer term view of work scope.”

The Navy is eyeing the possibility of buying material for both CVN-80 and 81 at the same time, an effort at further reducing inflation during construction. Every bit helps as Moore fights for scant funding with other procurement programs while the defense budget shrinks around them.

As the price for the 1,000-foot behemoths increases, “it feeds right into the hands of the people who question the need for 11 big-deck carriers,” Moore said.

“I think Newport News [Shipbuilding] knows the ship has to bemore affordable,” he said. “If we can’t get the cost down, we put the future of the 11-carrier fleet at risk.”

Moore stressed an “optimal build plan” that Navy officials are working with Newport News shipbuilders to establish. The plan will incorporate construction practices from other shipyards like building vertical sections of the ship and piecing them together rather than building from the ground up in horizontal layers, Moore said. The goal is to get the construction time down from 50 million man hours for the Ford to at least 44 million man hours for CVN-79, the USS John F. Kennedy. The goal for CVN-80 and beyond is to reduce overall work to 40 million man hours.

Each 1,000-foot-long behemoth takes at least five years tobuild. The next two will be delivered in seven years each, but the Navy plans to keep buying one carrier every five years, Moore said. With a service life of 50 years, a meticulous schedule of materials purchasing, procurement and construction is necessary to maintain a functional fleet of 11 carriers, which is called for by law and in the Navy’s 30-year shipbuilding plan.

In fall of 2016, the Navy will temporarily have only 10 aircraft carriers, a point at which carrier naysayers point as evidence the Navy doesn’t need 11. Moore countered that 10 carriers simply is not enough to provide a global presence in a “15-carrier world.”

With a 10-carrier fleet, one is refueling at any given time and is not available for deployment. Three are deployed around the world while three just came back to port. The final three are being prepped to deploy.

“People say you only need four at a time,” Moore said, speaking hypothetically about the challenge of keeping multiple carriers deployed. “The reality is that 10 really isn’t enough.”

Because the ships last 50 years and must undergo a two-year overhaul at 25, the Navy keeps meticulous track of their deployment and replacement schedule. Any alteration in the rotation or construction throws the whole system out of whack, Moore said.

The schedule is equally important to the shipyard and its 20,000 workers, a portion of whom would have to be furloughed or laid off if the Navy delays its shipbuilding schedule, shipyard officials have said. Moore said a two-month delay in either new ship construction or mid-life refueling and overhaul could affect 1,200 workers.

“We are very sensitive to the industrial base,” Moore said. “In kind, the shipyard has a duty to work with us to make the ships more affordable.”

More affordable ships means more business for the shipyard and larger profits, Moore said. That is the reasoning he uses to deal with a shipyard that has no competition and a captive customer. There is nowhere else for the Navy to shop for big deck carriers.

Overall, Moore praised the shipyard for its engineering prowess. The reason, he said, that no other country has successfully launched a sustainable carrier fleet is that “they’re really hard to build.”

Correction: The original story said that Ford-class carriers are designed to shave $50 billion from total lifecycle cost. They will cost $5 billion less than Nimitz-class ships over their service life. 

Photo Credit: Navy
Posted at 4:19 PM by Dan Parsons | Permalink | Email this Post | Comments (3)

Comments

Re: Navy Admiral: Rising Cost Threatens Future of Aircraft Carrier Fleet

hahaha....if completed well before in time..will this issue raise..lame excuse......now the ship will be delivered by 2018 [hope not an Election promise]...with outdated technology?
Navin at 9/28/2012 5:21 AM

Re: Navy Admiral: Rising Cost Threatens Future of Aircraft Carrier Fleet (UPDATED)

What would the cost be to upgrade a carrier vs building a new ship?
With the advent of UCAV's and manned aircraft on the same ship, how is that going to be handled?
Will there be a vessel needed just for UCAV's? or could manned and unmanned aircraft play well together! How would UCAV's contact the ATC of the vessel they are supposed to land on?

Just afew thoughts
Patrick Easley at 9/28/2012 10:57 AM

Re: Navy Admiral: Rising Cost Threatens Future of Aircraft Carrier Fleet (Updated)

Now if you think this article is depressing, read this NDIA article: http://www.nationaldefensemagazine.org/blog/Lists/Posts/Post.aspx?List=7c996cd7-cbb4-4018-baf8-8825eada7aa2&ID=607 

-an interview with MIke Petters of HII from last December. 

I think one of these two paradigms is going to shift without a clutch.
Jeremiah Smith at 11/6/2012 5:28 PM

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