Source: https://commons.wikimedia.org/w/index.php?curid=152051811
BY KEVIN POLICARPO
The U.S. Navy and its shipbuilders: “are effectively made to operate in a perpetual state of triage. As a result, the Navy must divert its attention to shipbuilding programs that fall behind schedule and grow in cost,” according to a March General Accounting Office (GAO) report.[1]
A second GAO report published in February 2025, titled SHIPBUILDING AND REPAIR Navy Needs a Strategic Approach for Private Sector Industrial Base Investments, found that: “… from 2007 to 2018, cost growth in Navy shipbuilding exceeded Navy estimates by over $11 billion.”[2]
The March GAO report, Navy Shipbuilding A Generational Imperative for Systemic Change, (March 11th, 2025) explains:
“The Navy continues to set extensive and detailed requirements for new vessels many years before they are fielded as well as lock in major commitments to construct ships before design stability is achieved. This has led to unrealistic cost and schedule expectations. In maintaining this status quo … unmet expectations disturb the Navy’s funding plans, driving the department to redirect resources intended to pay for other needs and resulting in unfunded capabilities. Further, delays in delivering new ships to the fleet exacerbate issues with obsolescence and capabilities becoming irrelevant when threats evolve. Lack of focus on sustainment when designing ships and persistent challenges maintaining its fleet further hinder the Navy’s ability to meet operational and national security needs.”[3]
With the rise of China as a naval power and increasingly aggressive actions in the Pacific toward Taiwan, Japan, the Philippines, Vietnam and Australia, the U.S. is working to increase their own Navy’s numbers and capabilities.
However, despite almost doubling the shipbuilding industry’s budget over the past 20 years, the Navy’s size has not increased and has remained stagnant.[4]
Shortfalls in Shipbuilding Industrial Base
Over the past twenty years, the GAO has consistently found shortfalls in the performance of Navy shipbuilding programs and made recommendations to help the Navy resolve these issues. Since 2018, the GAO has produced reports that have expounded on these persistent problems, “…finding that Navy ships cost billions more and take years longer to build than planned while often falling short of quality and performance expectations.”[5]
The March GAO report focused on billions of dollars in waste and shipbuilding losses:
- In December 2024, “we found that the Navy wasted $1.84 billion maintaining and modernizing four cruisers that were subsequently decommissioned without deploying after modernization. Two of the ships underwent about 8 years of maintenance and modernization, but according to Navy officials, would have required significant effort to complete their modernizations and over $200 million in additional funds.”
- In a December 2024 report on the Navy’s amphibious fleet, “we found that the Navy is not on pace to replace its largest amphibious ships without significant additional investment. Further, we found that, to avoid a sustained drop in fleet size, the Navy would need to keep nearly all its legacy amphibious assault ships in service past their expected service lives while it waits for new ships. The Navy estimates that extending the service life for some ships to meet the fleet requirement will require up to $1 billion per ship.”
- In September 2024, “we reported that our analysis of recent data for the Columbia class program showed that cost and schedule performance for lead submarine construction had consistently fallen short of targets. We also found that the lack of improvement through early 2024 and future risks will likely add to cost and schedule growth. These findings are a continuation of our reporting going back to 2017 that the lead submarine’s aggressive schedule and the program’s optimistic cost estimate did not adequately reflect risks.”
- In June 2024, “we found that the Virginia class submarine program’s rate of production to meet fleet needs remains at 60 percent of the planned rate of two submarines per year. We also found that the shipbuilder is completing work at a higher cost than expected, resulting in an estimated need for $530 million more than planned to complete the first two Block V submarines in the class.”
- In May 2024, “we found that the Navy and the shipbuilder for the Constellation class frigate program were struggling to stabilize the ship design and, consequently, ship construction had effectively stalled. These problems contributed to an estimated delay of 3 years to the lead frigate’s delivery and the shipbuilder expecting to exceed the contract ceiling price on the fixed price incentive (firm) contract for the lead ship.”
- In April 2022, “we reported that the Navy shipbuilding plan outlined spending $4.3 billion over 5 years for 21 robotic autonomous maritime systems—systems with no crew onboard. In doing so, the Navy did not account for the costs of operations and sustainment and the digital infrastructure necessary to enable them (italics added). This creates risk that unrealistic cost estimates will skew the Navy’s understanding of the affordability of these systems and undermine decision-making for future force plans.
- In March 2020, “we found that the Navy’s lack of focus on sustainment when designing ships resulted in significant and costly problems for the fleet. For example, we estimated that the fleet spent billions of dollars to address unexpected problems affecting multiple ship classes because shipbuilding programs did not identify or mitigate sustainment risks through planning during the acquisition process. According to fleet leadership, these problems contributed to the fleet’s inability to maintain ships at planned cost and schedule.”[6]
FOOTNOTES
[1] https://www.gao.gov/assets/gao-25-108136.pdf p.3
[2] https://www.gao.gov/assets/gao-25-106286.pdf p.24
[3] https://www.gao.gov/products/gao-25-108136 p.3
[4] Ibid. p.3
[5] Ibid. p.9
[6] Ibid. p.10-11