U.S. Littoral Combat-Ship Delays Extended, Navy Reports

Photographer: Daniel Acker/Bloomberg

A U.S. Navy Littoral Combat Ship sits in the final production area during its construction in Marinette, Wisconsin. Close

A U.S. Navy Littoral Combat Ship sits in the final production area during its... Read More

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Photographer: Daniel Acker/Bloomberg

A U.S. Navy Littoral Combat Ship sits in the final production area during its construction in Marinette, Wisconsin.

Senator John McCain questioned the future of the Navy’s troubled Littoral Combat Ship as the latest batch of vessels is running as much as a year behind delivery schedules.

“We need to fix it, or find something else quickly,” McCain, an Arizona Republican, said today at a Senate Armed Services subcommittee hearing.

The fourth of 52 planned ships is scheduled for delivery in July, 13 months behind original plans, according to information provided by the Naval Sea Systems Command. The fifth through eighth vessels are five to eight months late.

The delays may add to increased scrutiny of the $37 billion program aimed at building a small, speedy and adaptable ship to patrol waters close to shore. A confidential Navy study reported yesterday by Bloomberg News found the ships are too lightly manned and armed to meet their promised missions.

“The Navy plans for the Littoral Combat Ship to comprise over one-third of the nation’s total surface combatant fleet by 2028, and yet the LCS has not demonstrated to date any adequate performance of assigned missions,” McCain said.

Among potential issues is whether the Navy needs to keep buying four ships a year, as proposed in the Pentagon’s fiscal 2014 budget request, if those already on order are falling behind.

“Despite the schedule delays with the early ships” the Navy “is committed to putting these ships to sea rapidly to meet the requirements around the world,” the Naval Sea Systems Command said in an e-mailed statement.

Sea Trials

The Navy’s financial liability for any delays is limited because the fixed-price incentive contracts on the vessels require contractors to absorb greater overrun shares, according to the command.

The fourth ship, now in sea trials, was built by Falls Church, Virginia-based General Dynamics Corp. (GD), which is no longer a prime contractor for the Littoral Combat Ship.

The fifth through eighth vessels are being built with two different designs by teams led by Bethesda, Maryland-based Lockheed Martin Corp. (LMT) and Henderson, Australia-based Austal Ltd. (ASB) There’s a potential for additional delays for those vessels because they’re currently 27 percent to 51 percent complete, according to the Navy.

The confidential March 2012 review for Admiral Jonathan Greenert, the chief of naval operations, raised questions about the vessel’s concept of operations, manning, vulnerability and maintenance.

Capabilities Gap

“This review highlights the gap between ship capabilities and the missions the Navy will need LCS to execute,” said the report prepared by Rear Admiral Samuel Perez. “Failure to adequately address LCS requirements and capabilities will result in a large number of ships that are ill-suited to execute” regional commanders’ warfighting needs.

Vice Admiral Richard Hunt, head of the Navy’s LCS Council, created to respond to concerns in the Perez report and other assessments, told reporters today on a conference call that he’s “comfortable with the ships out there,” including the first, the USS Freedom, which is in Singapore on an eight-month deployment.

“Admiral Perez had a free hand” to criticize the program, “did a credible job” and “provided some pretty good insights,” Hunt said.

Numbers Question

The report’s criticism of the Navy’s plan to have as few as 40 sailors operating each vessel contributed to a Navy decision to add 10 more, Hunt said.

While “we’ve fixed some of” the issues in the earlier assessments “before I stand up and say everything is corrected, I want to see it operate,” Hunt said. “That’s what we are doing right now.”

While the ship started out as a “mess,” it has “become one of our best-performing programs,” Navy Secretary Ray Mabus told the House defense appropriations subcommittee yesterday.

“We have two great shipbuilders” and the vessels are “coming out now under budget and on time,” he said.

Greenert acknowledged the delivery delays to the Senate defense appropriations subcommittee during an April 24 hearing without providing details.

“I believe that the current delivery schedule will meet the needs of the Navy,” Greenert said. “It was mostly just some hitches that you get here and there when you get a new class of ship.”

The companies are getting in position to deliver an LCS every six months, the Naval Sea Systems Command said.

‘Aggressive’ Schedule

The Navy has 20 vessels under contract. Construction costs have doubled to $440 million per ship from an original goal of $220 million. The Navy is requesting $2 billion to buy four more in fiscal 2014, half from Lockheed and half from Austal.

The 13-month slip in schedule for the fourth ship, the USS Coronado, was caused by issues including “an aggressive initial schedule” and “not chasing schedule at the expense of cost performance,” the Navy said.

“We’ll defer to the Navy to discuss reasons for schedule changes,” General Dynamics spokesman Jim DeMartini said in an e-mailed statement. “We work continually with the Navy to monitor cost and schedule performance.”

Austal spokesman Craig Hooper referred inquiries to the Navy. Lockheed spokeswoman Dana Casey said in an e-mail that the company requested a delay so it could complete shipyard improvements “and to account for work being finished on other government projects.”

“Lockheed Martin is confident that future schedule shifts will be avoided as the shipyard’s workforce will be dedicated” to the Littoral Combat Ship, she said. “We’re already seeing the positive impact.”

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net

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