the 2018 outlook for navy shipbuilding
TRANSCRIPT
Congressional Budget Office
Presentation at the Bank of America Merrill Lynch Defense Outlook Forum
January 10, 2018
Eric J. LabsSenior Analyst for Naval Forces and Weapons, National Security Division
The 2018 Outlook for Navy Shipbuilding
1
CBO
Costs and effects of building a 355-ship navy– How fast can it be built with new construction?– How much will it cost to build?– How much will it cost to operate?
Implications for the shipbuilding industrial base
Recent shipbuilding budgets
Can service life extensions or reactivating retired ships help?
Outline
2
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Composition of the Fleet by Ship Type, Historically and Under Recent Force Structure Assessments
FSA = force structure assessment.
Percent
3
CBO
Annual Inventory of Battle Force Ships Under Different Timelines
Ships
4
CBO
Average Annual Ship Purchases and Shipbuilding Costs Under Different Timelines
5
CBO
Number of Sailors Required to Crew a 355-Ship Fleet
6
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Annual Direct Operating Costs of a 355-Ship Fleet
7
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O&S = operation and support.
Average Annual Total Costs for a 355-Ship Fleet
Billions of dollars
8
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Seven shipyards– Bath Iron Works– NASSCO– Electric Boat– Newport News
Shipbuilding rates are projected to increase from 8.3 per year over the past decade to 12 to 15 per year over the next 10 years
That would increase the workforce 40 percent across the yards over the next 5 to 10 years under the most demanding timelines
Up to $4 billion in infrastructure would be invested
Implications for the Shipbuilding Industrial Base
Seven shipyards– Ingalls Shipbuilding– Austal USA– Fincantieri Marinette Marine
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CBO
0
5
10
15
20
25
2012 2013 2014 2015 2016 2017
Billions of Dollars
President's Request Appropriated Funds
Requested and Appropriated Shipbuilding Budgets, 2012 to 2017
On average, the Congress appropriated $1.8 billion per year more than the President requested.
10
CBO
Relax force structure requirements
Use Service Life Extension Programs (SLEPs) for some cruisers, destroyers, amphibious warfare ships, and logistics ships
– Improve hull, mechanical, and electrical systems for additional service life of five to ten years
– Upgrade combat systems—particularly for cruisers and destroyers—to be effective in future combat environments
No reactivations of retired ships
Can the Navy Get 355 Ships Faster?
11
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20-Year Buildup With SLEP
20-Year Buildup
250
275
300
325
350
375
400
2017 2022 2027 2032 2037 2042 2047
Ships
Annual Inventory of Battle Force Ships With SLEP Alternative