Navy should delay next carrier, GAO says

By Tony Capaccio | Bloomberg News
© June 28, 2013

The Navy should delay the award of a multibillion-dollar contract to Newport News Shipbuilding to build the second aircraft carrier in a new class as the first one faces failings from its radar to the gear that launches planes, congressional investigators say.

“Technical, design and construction challenges” with the first carrier, the Gerald R. Ford, have caused “significant cost increases and reduce the likelihood that a fully functional ship will be delivered on time,” the Government Accountability Office said in a draft report obtained by Bloomberg News.

The Ford, already the most expensive warship ever built, is projected to cost $12.8 billion, 22 percent more than estimated five years ago. The report raises questions about the future of U.S. seapower in a time of reduced defense budgets and about whether new carriers are affordable as they assume greater importance in the Pentagon’s strategy to project U.S. power in the Asia-Pacific region.

Delays and “reliability deficiencies” with the flattop’s new dual-mission radar, electromagnetic launch system and arresting gear for aircraft mean that the Ford “will likely face operational limitations that extend past commissioning” in March 2016 and “into initial deployments,” the agency said.

The GAO, Congress’ investigative arm, said that’s reason enough to delay the contract scheduled to be issued this year for the second ship, the John F. Kennedy.

“It will be important to avoid repeating mistakes” in the contract for the Kennedy, the GAO said. “Staying within budget” will require the Navy to reduce “significant risk mainly by completing land-based testing for critical technologies before negotiating a contract” with Newport News Shipbuilding’s parent company, Huntington Ingalls Industries.

Beci Brenton, a company spokeswoman, said in a telephone interview that “it would not be appropriate to comment on a draft report.”

Naval Sea Systems Command spokeswoman Colleen O’Rourke said the command also wouldn’t comment.

“As the Navy is currently working with the GAO on this report, it would be inappropriate to comment on any draft findings at this time,” she said in an email. “When the report is finalized, it will include Navy comments.”

The Navy is grappling with how to pay for a shipbuilding plan that anticipates $43 billion for three carriers in the Ford class, as well as $34 billion for 52 Littoral Combat Ships and a 12-vessel nuclear submarine fleet to replace the Ohio-class submarine.

While the GAO said that the Navy and Huntington Ingalls are taking steps to control costs for the Ford, most increases occur after a vessel is 60 percent complete, when key systems are installed and integrated. The Ford is now 56 percent complete.

Even the current $12.8 billion estimate is “optimistic because it assumes the shipbuilder will maintain its current level of performance throughout the remainder of construction,” the GAO said.

The Pentagon’s independent cost-estimating office, the Congressional Budget Office and a Navy-commissioned panel project final costs as high as $14.2 billion, the GAO said.

The draft report also raises questions about how many aircraft carriers the nation will have ready this decade. Congress has given the service temporary relief from the requirement to have 11 fully capable aircraft carriers. There are now 10 after inactivation of the Enterprise, and the Ford is supposed to bring that back to 11 by March 2016.

“As it now stands, the Navy will not be positioned to deliver a fully capable ship at the time,” the GAO said.

“Reliability shortfalls facing key Ford-class systems cloud the Navy’s ability to forecast when, or if” the carrier will meet the aircraft sortie rates and reduced manning requirements that distinguish it from the older Nimitz class, the GAO said.