Navy Seeks to Avoid Cost Overruns on Next Carrier

NEWPORT NEWS, Va. -- U.S. Navy and Huntington Ingalls Industries Inc. officials say they’re making progress on the service’s next aircraft carrier and trying to avoid the type of cost overruns that plagued its predecessor.

The Navy’s first next-generation, Ford-class carrier -- USS Gerald R. Ford -- is estimated to come in at least $2.5 billion over budget. Service officials say they realize they can’t make the same mistake on the follow-on carrier, the USS John F. Kennedy, in the current budget environment without putting the future carrier fleet at risk.

Navy program managers and their counterparts at Huntington Ingalls Industries say they’re using various shipbuilding techniques -- such as three-dimensional computer modeling and new construction practices -- to decrease the cost, manpower and time needed to build the Kennedy.

Some 300 pieces of the USS John F. Kennedy have already been built, according to Rear Adm. Tom Moore, the Navy’s program executive officer for carriers.

 "I fully expect we will build Kennedy for a billion [dollars] less than we built Ford," Moore said. "We’re already taking significant steps. We’ve got a plan in place but we’re not done -- we need to continue to do better. I spend many waking hours working with the ship builder and we are not done looking at new ways to build that ship more affordably. This is a continuous process."

The USS Gerald R. Ford may cost as much as $15 billion, according to recent estimates. Sen. John McCain, R-Ariz., suggested at a congressional hearing in May that the Navy has lost control of costs because Huntington Ingalls doesn’t have suitable competition.

"What can we do? What can we do to prevent this kind of cost overrun which… is unacceptable when we have a terribly damaged economy?" McCain asked Sean Stackley, the Navy’s assistant secretary for procurement.

Stackley called the cost growth "unacceptable," saying that "far too much risk was carried over into the design of the Ford class."

The initial pieces of the USS John F. Kennedy are being assembled at the company’s Newport News Shipbuilding division in Virginia. The next-generation carrier is slated to enter service in 2025.  

The Kennedy will be the second in a new Ford-class of carriers. The first, the USS Gerald R. Ford, is scheduled to enter the water for christening in November, followed by testing and additional construction. The ship is set to be commissioned in 2016.

"What happens at the christening is we are moving it out of the dock and into the water so that we can finish the system construction and begin all of the system testing. The christening is a transition from pure construction to a new phase of construction with testing," Mike Petters, chief executive officer of Huntington Ingalls Industries. "Every ship takes on a life of its own. We’re going to see this big piece of steel with lots of cable and piping in it transform into a small city with a personality."

The Navy in 2008 awarded the company a contract to design and begin building the Ford. The effort, which is estimated to cost between $13 billion and $15 billion, is designed to field a new generation of aircraft carrier technology.

 At the same time, the Ford has been criticized for schedule delays and cost overruns by member of Congress and watchdog agencies such as the Government Accountability Office.

 The Navy attributes some of the Ford cost growth to being part of a first-in-class series of aircraft carriers, meaning some of the developmental costs for the platform are one-time expenses which won’t recur. In addition, service officials say construction on the Ford began when only about a quarter of the design was complete. 

By contrast, Navy officials say the Kennedy’s design is complete and the materials are in place.

"When we started building Ford, we were completing design and building at the same time -- so we had to order material incrementally. Now, this design is 100-percent complete, all the material requirements are known," Ken Mahler, vice president of Navy programs at Huntington Ingalls Industries.

"You can see the focus on affordability and the momentum we have," he said. "We’re already rolling all the lessons from Ford into Kennedy."

Shipbuilders and engineers have also been using computer aided design, or CAD, a three-dimensional modeling technique aimed at helping workers solve problems before welding or putting pieces together.

"You have a 3D opportunity to optimize the build," Mahler said. "The Navy actually can use this and approve the space design and layout."

Officials credited the modeling techniques with helping to resolve specific design issues prior to construction, such as the configuration of the island on the flight deck.

"We’ve done this for years with submarines," Moore said. "I think we’re just starting to tap into the potential that this has not only in building ships but in modernizing and maintaining with each subsequent ship."

The company is also trying to maximize the construction and grouping of similar parts of the ship before loading them into the dock area, in what it calls the "family-unit" approach.  Work that takes one hour in the shop can take three hours on the dock and up to eight hours on the ship, Moore said.

"We’re already seeing some significant returns on this in terms of cost and performance," he said. "We’ve gotten some significant reductions in the hours that it is going to take to build the ship."

The work includes pre-outfitting bulkheads, welding, painting, and laying pipe and cables on similar units in tandem in an assembly area, then moving the pieces to the dock for integration onto the larger ship structure, service and company officials said.

Navy and company officials are also working on a vertical construction scheme for the ship. The method allows for access to the sides of the ship up to six or seven stories, Moore said. With more access to smaller, integrated components, the technique is known as building "modules" and is being used to build the DDG 1000 destroyer and the Virginia Class Submarines.