The following is the June 22, 2023, Congressional Research Service report, Navy Virginia (SSN-774) Class Attack Submarine Procurement: Background and Issues for Congress.
From the report
The Navy has been procuring Virginia (SSN-774) class nuclear-powered attack submarines (SSNs) since FY1998, and a total of 38 have been procured through FY2023. Since FY2011, Virginia-class boats have been procured at a rate of two per year. Virginia-class boats procured in FY2019-FY2023 were procured under a multiyear procurement (MYP) contract. The Navy wants the next Virginia-class MYP contract to begin not in FY2024, but in FY2025.
The Virginia-class design has been updated multiple times since FY1998. Most Virginia-class boats procured in FY2019 and subsequent years are to be built with the Virginia Payload Module (VPM), an additional, 84-foot-long, mid-body section equipped with four large-diameter, vertical launch tubes for storing and launching additional Tomahawk missiles or other payloads. When procured at a rate of two boats per year, VPM-equipped Virginia-class SSNs have an estimated procurement cost of about $4.3 billion per boat.
The Navy’s proposed budget requests the procurement of the 39th and 40th Virginia-class boats. The Navy’s FY2024 budget submission states that one of the two boats is to be built to a special configuration referred to as the “Modified VIRGINIA Class Subsea and Seabed Warfare (Mod VA SSW)” configuration. The two boats requested for procurement in FY2024 have an estimated combined procurement cost of $9,427.6 million (i.e., about $9.4 billion), including $5,356.9 million for the Mod VA SSW boat and $4,070.7 million for the other boat. The two boats have received a combined total of $2,297.7 million in prior-year advance procurement (AP) funding, and the Navy’s proposed FY2024 budget requests the remaining $7,130.0 million needed to complete their estimated combined procurement cost. The Navy’s proposed FY2024 budget also requests $1,855.5 million in AP funding for Virginia-class boats to be procured in future fiscal years, $1,360.0 million in Economic Order Quantity (EOQ) funding, which is an additional kind of AP funding that can occur under an MYP contract, and $168.2 million in cost-to-complete (CTC) funding to cover cost growth on Virginia-class boats procured in prior years, bringing the total amount of procurement, AP, EOQ, and CTC funding requested for FY2024 to $10,513.7 million (i.e., about $10.5 billion).
The Navy’s current force-level goal, which was released in December 2016, calls for achieving and maintaining a fleet of 355 manned ships, including 66 SSNs. Under the Navy’s FY2024 30-year (FY2024-FY2053) shipbuilding plan, which includes three alternatives, the SSN force would reach a minimum of 46 boats in FY2030 and grow to 60, 69, or 63 boats by FY2053.
In September 2021, the U.S., UK, and Australian governments announced a significant new security partnership, called AUKUS. The first major initiative under AUKUS is to be a project for Australia, with U.S. and UK assistance, to acquire and operate its own force of SSNs. On March 13, 2023, following an 18-month study period, the three governments issued a joint statement outlining their proposed SSN AUKUS pathway, under which, starting in the early 2030s, and pending congressional approval, the United States would sell Australia three Virginia-class boats, with the potential to sell up to two more if needed. On May 2, 2023, DOD sent to Congress a package of legislative proposals that would provide DOD with the authority to accept payments from the government of Australia for the purpose of improving the U.S. submarine industrial base; authorize the transfer of up to two Virginia-class SSNs to the government of Australia in the form of a sale, with the costs of the transfer covered by the government of Australia; and provide for the training of the Australian private-sector personnel to support the development of the Australian submarine industrial base under the foreign military sales program pursuant to the Arms Export Control Act (AECA).
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