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Navy: Ohio Replacement Negotiations ‘Have Not Progressed’

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An undated artist's rendering of the Ohio Replacement. Naval Sea Systems Command

An undated artist’s rendering of the Ohio Replacement. Naval Sea Systems Command

The Navy’s top acquisition official told the Senate Armed Services Committee Seapower Subcommittee that talks with the Defense Department “have not progressed” in putting the Ohio-class ballistic-missile replacement program into a special National Capital Ships Account.

Testifying on 8 May, Sean Stackley said the long-range impact of keeping the 12 Ohio-class ballistic-missile submarines in the Navy’s shipbuilding account means “we will not be able to hit the numbers” to build other ships.

Even though costs have been driven down—from $7 billion per vessel to $4.9 billion—he said that effort “does not buy ship affordability.” The Navy’s shipbuilding plans five years from now call for spending $20 billion for 12 to 15 years to put the replacement ballistic missile submarines into the fleet. The Navy’s shipbuilding request for Fiscal Year 2014 is slightly more than $10 billion.

There “needs to be more heated” discussions in the Congress, the Defense Department and the Navy over how to pay for the Ohio-class replacements and build the other ships needed to meet the 306-ship presence requirement, he said.

On next generation Gerald Ford (CVN-78), Stackley said steps taken by Huntington Ingalls at Newport News, vendors, and the Navy have “stayed cost, but not reversed it.” The original projected cost of the carrier was $10.5 billion, but is now put at $12.8 billion. Newport News is the only shipyard building nuclear-powered carriers.

Calling the cost growth unacceptable, Stackley explained, “Far too much risk was carried into the design” that created matériel ordering and delivery delays. At the same time, “far too much work is being done at the end of the cycle” in dry dock and the water rather than in Newport News’ shops.

“CVN-79 will start with a clear design,” learned from building Ford. Because carriers are unique with their five- to seven-year construction cycle, there is “an extended learning curve” for shipyard workers; but now the yard and vendors understand what is expected of them.

“The early LPDs got away from us,” Vice Adm. Kevin McCoy, Naval Sea Systems Command commander, told the panel, but the San Antonio-class amphibs “are performing well in service.” He added there have been zero in-service start cards on the propulsion system in the San Antonio-class.

What helped bring that program’s costs under control and improve quality workmanship was adding trained staff to the supervisor of shipbuilding’s office. McCoy said the Navy realized in 2006–2007 that cuts in that staff were too deep and has increased personnel to about 1,200 now. That allows the Navy to make more inspections of ships under construction within the shipyard and without, and “spotting negative trends” that can be corrected before delivery, he said.

If sequestration continues into Fiscal Year 2014 and is authorized to run 10 years, the Navy would expect to take a hit of $52 billion. Stackley said the effect on shipbuilding would be felt in the addition of a tenth DDG-51 to the Flight III plan, adding a second Virginia-class submarine in this request and delaying the first mine-countermeasure and surface-warfare variants of the littoral combat ship into the next fiscal year.

Stackley said he already had “pulled all the margin out of shipbuilding” to cover sequestration cuts for this fiscal year. He added that the Navy wants to exempt shipyard and depot workers from this year’s furloughs “because of the direct impact on readiness,” and is seeking that permission.

If furloughs go through there will be less overtime on NAVSEA’s 57,000 workers’ slipping maintenance schedules for carriers, ballistic-missile and attack submarines in that yard, McCoy said. “Our Navy can’t sail without [its civilian workers].”

Describing what was happening in private yards, Stackley said, sequestration “created a great deal of uncertainty” that trickles down into the differing levels of the vendor base and threatens the savings from multiyear contracts because construction schedules have to be extended.

“We want to hold on to the skilled workforce that we’ve got” and sequestration “is a detractor for folks in industry considering government service,” he said, citing the acquisition workforce as an example.

Vice Adm. Allen Myers, deputy chief of naval operations for integration of capabilities and resources, warned, “It going to be increasingly difficult [to recruit and retain] the right workers with the right skills if we don’t put certainty back into the process.”