DD (X) Gets Go-Ahead Through Milestone B Review
On Veteran’s Day, DID covered the DD (X) destroyer program‘s upcoming Defense Acquisition board review, and noted the fact that DD (X) disputes were one of the main obstacles holding up the FY 2006 defense appropriations bill. We’ve noted past articles covering GAO reports and the DD (X)’s likely cost of over $3 billion per ship, the July 2005 Critical Design Review, threatened cost caps from the House and examination of alternatives, to the concept behind its AGS long range naval gun.
The program that once hoped to produce 32 ships will now spend a significant percentage of the Navy’s shipbuilding budget on a class that is slated to include only 8 ships according to the new Destroyer Acquisition Decision Memorandum, and may well go as low as 5 ships if further cost slippages occur. Based on the memo and the amount left for system development & design, the DD (X) program can be expected to spend about $30 billion more if it remains within budget. This figure would not include operations and maintenance costs.
GAO director of acquisition and sourcing management Paul L. Francis’ comments re: managing the program from this point forward [Congressional testimony, PDF format] now seem more relevant than ever.
The signing of the memo is the last major milestone needed before the Navy can proceed with detailed design for the ship and procure material for ship construction, though the House-Senate disputes over per-ship cost caps and advance funding have yet to be resolved in a reconciliation bill. If the program survives that hurdle, there remains only one routine procedural review before construction begins, which reconciles Navy and Department of Defense individual program cost estimates and establishes testing requirements for the ship.
Per congressional insistence on a cost-raising two-shipyard strategy, the Pentagon also approved a plan to have Northrop (in Pascagoula, MS) and General Dynamics (in Bath, ME) each build a ship during the system design & development (SDD) phase. The idea is apparently to use that phase as a competition, and then award the contract to the best performing shipyard. It remains to be seen whether Congress will allow this, however.
The US Navy is expected to ask for funds to begin building the ships in fiscal 2007, when the proposed budget is submitted to Congress in February.
Additional Readings:
- South Mississippi Sun-Herald (Nov 22/05) – The Pentagon’s Dilemma. Interesting larger context. Looks at the effect rising personnel costs are having on the defense budget and procurement programs.
- Navy Times (Nov 23/05) – DD (X) Gets Go-Ahead
- LA Times (Nov 24/05) – Building of Navy Destroyers is OKd. Good coverage of the political hurdles remaining.
