CBO Report on Navy Submarine Maintenance Costs

April 23, 2019 2:41 PM

The following is the April 22, 2019 Congressional Budget Office report, Costs of Submarine Maintenance at Public and Private Shipyards.

From the report

Public shipyards conduct a large majority of all submarine maintenance. Those shipyards are Navy-owned and -operated, but the Navy has been experiencing long delays—sometimes as much as several years—to obtain maintenance on its submarines at those shipyards. As a result, some submarines have missed deployments or had shortened deployments. The Navy has sent several submarines to private shipyards for overhauls in recent years but could send more.

This report compares the costs of submarine maintenance at public and private shipyards. This analysis focuses on depot maintenance—specifically, Docking Selected Restricted Availability (DSRA) overhauls— for the Navy’s Los Angeles class attack submarines (SSN-688s). DSRAs are medium-sized maintenance events that last several months and occur every four to six years over the 33-year lifetime of an SSN-688 submarine. They include maintenance, repairs, and upgrades; the submarine is put into a dry dock to enable work on the hull, propulsion, and systems (which would otherwise be underwater).

What Did This Analysis Find?

The Congressional Budget Office found that DSRA overhauls for Los Angeles class submarines cost less, on average, in private shipyards from 1993 to 2017 than in public shipyards, although that difference has narrowed—and perhaps disappeared—in recent years.

  • On average, overhauls at private shipyards have been 31 percent less expensive over the entire period.
  • After accounting for the age of the submarines and differences in maintenance plans, the gap was slightly larger: Overhauls at private shipyards were 35 percent less expensive, on average, than at public shipyards.
  • From 1993 to 1998, when the Navy used working capital funding (WCF) at public shipyards, DSRAs at private shipyards cost about half as much as those at
    public shipyards.
  • From 1999 to 2006, during the Navy’s transition to mission funding, costs at private shipyards were 21 percent less than those at public shipyards.
  • Since 2007, when the switch to mission funding at public shipyards was complete, costs at private and public shipyards have been about the same. However, CBO’s data include only one overhaul at a private shipyard after 2010, which makes a comparison of costs for overhauls after 2010 not meaningful.
  • The average cost of overhauls at all shipyards has risen: It was about $20 million in the mid-1990s, about $30 million in the mid-2000s, and roughly $50 million in the mid-2010s. In part, those rising costs reflect the aging of the submarines and the Navy’s shift to maintenance schedules that increased the time between, and the duration of, DSRAs.

Those findings were derived from CBO’s examination of data on 146 DSRAs (the most common type of overhaul) that occurred between 1993 and 2017. Of the DSRA overhauls that CBO examined, 29 were done at private shipyards and 117 were done at public shipyards.

Download the document here.

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