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Ship Costs in Perspective

March 2, 2010
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Someone asked why call for smaller, less capable warships? The above chart from the Congressional Budget Office, helps explain my thinking. Note that the cost of individual combatants now price double what they did in the 1980s. These figures are adjusted for inflation, which means for the same money you get fewer platforms.

My point is, thanks to the flexibility and capability of modern weapons, especially the Aegis system, and the enhanced accuracy of modern weapons like Standard SAMs and Tomahawk cruise missiles, you can build smaller ships, at less cost, more of them, without losing capability.

The same standard applies to naval airpower. Because the new Hornets are vastly more capable with precision bombs and missiles, plus more easier to maintain than older Tomcats and Intruders you can perform more sorties and destroy more targets with fewer planes. Naturally this should entail reducing the size of the airwing and the aircraft carrier. The smaller airwings are coming anyway, but the old flattop is just getting bigger, pricing itself into obsolescence.

You can only consider the smaller Flight III Arleigh Burke I proposed as being “less capable” as compared to modern naval thought, which is packing so many extra weapons and electronics into a warship, mostly redundant systems, making it too expensive and technically over-complicated. The apparently more capable ship ironically becomes less so because you can’t afford many of them, and the ones you get are so complicated as to be riddled with numerous faults.

Such vessels as the LCS, the DDG-1000, and the LPD-17 are examples of ships so heavenly capable they are little earthly good, Harbor Queens all, or potentially so. But a back to basics approach would fix all this. Smaller warships are not less capable but a logical response to the modern technology. It calls for a revolution in shipbuilding, which we are long past due.

26 Comments leave one →
  1. Chuck Hill permalink
    March 5, 2010 1:19 am

    Graham Strouse said, “…the only two permanently sunk by enemy fire were Arizona & the training ship Nevada, both at Pearl Harbor.

    I think you mean Utah vice Nevada.

  2. Graham Strouse permalink
    March 5, 2010 12:30 am

    I think it’s worth noting that modern diesel-electric and AIP submarines have VASTLY more endurance, & general capability then WWII submarines. That said, America’s submarine fleet was quite arguably more crucial then the carriers in WWII. At the beginning of the conflict they fought to buy time, harried Japanese & cut into Japanese supply lines. As the war progressed they became incredibly valuable scouts, severed Japan from its theived industrial base & wreaked havoc on Japanese surface units. American submarines dished out FAR more punishment then they soaked, even with the high attrition rate. The vast bulk of Japanese merchant shipping went to the bottom thanks to diesel-electric US subs and 29% of Japan’s naval shipping was also destroyed by those little subs.

    And don’t knock the BBs. Americas old battleships were incredibly durable & equipped with up to date radar & AA were extremely valuable as bombardment ships, AA escorts & command ships. A lot of people fail to mention that of all the US BBs operational in WWII (and there were A LOT, new and old), the only two permanently sunk by enemy fire were Arizona & the training ship Nevada, both at Pearl Harbor.

    BTW: By the end of the war the British were actually building more durable, if far less numerous CVs. Late-war British carriers were much more capable of surviving dive-bomb & kamikaze attacks then US carriers.

    Just sayin’.

  3. March 4, 2010 10:16 pm

    Hopefully you’ll indulge one more respons…

    Carriers decided the pacific, not the war. Once we owned the pacific, there was still the ground war to contend.

    Nuclear submarines can operate in shallow water, and do so. Yes, there are risks. But I’d say the risks are greater for diesel submarines. Here’s the thing about deisels: They cannot stay on station, and when submerged they cannot monitor Sonar, operate a fire control systems, run the gallery and air conditioning, prepare weapons for launch, make fresh water, on and on. A Deisel boat on a battery is simply not that capable. Even in shallow water. And consider this – Litoral waters are clogged to over flowing with local shipping. Thsi shipping has to be closely monitored by sonar and fire control to ensure safety from collission. Moreover, Deisels must always be mindful of a proper course and area for approaching to PD, to recharge.

    And in all that mess, you need really good sonar to find the bad guy. Otherwise, why are you there. And really good Sonars take lots of electricyt and chill water.

    No, not there with you about deisel submarines. If we build Deisels, we wont build Nucs. And even China is building nucs.

    I will concede one point though – the use of Littoral Combat ships will save a lot of on-station time by nuclear submarines.

    Tom

  4. Mike Burleson permalink*
    March 4, 2010 9:21 pm

    ” nothing beats a Nuclear Submarine in its element”

    No argument there Tom, but is the shallow seas the proper element for a 7000+plus ton nuke submarine? And how about numbers? Will we ever see 100 boats again or even rise above 40-50? My point is, capability is a wonderful thing if you can afford it. Thanks you so much for your service but I don’t think even you condone the drastic shrinkage of the fleet since the fall of the Iron Curtain, and the deployments aren’t less even though the fleet is smaller . New times call for new measures and the fleet must adapt or die.

    And if the end of the Jap carriers decided the Pacific War, why did we have to keep fighting past the summer of ’42? Certainly the capital ships create a condition for command of the sea but it takes a team effort to maintain sea control, a balanced fleet, currently top heavy and leaning hard.

  5. March 4, 2010 8:06 pm

    Great argument, Mike and I’ll try try to remember, I’m a guest here!

    First this: “My argument is, the price of buying only these type ships have given us a smaller, over-worked fleet”. Concur.

    Now this one: “Small diesel submarines roamed the vast expanses of the Pacific when the battlefleet lay in ruins at Pearl Harbor and the aircraft carriers were steadily dwindling in numbers because of ATTRITION”.

    We lost 52 submarines in the pacific; the highest mortality rate of any branch of military. Germany fared alot worse. And the number of warships sunk by submarines from either side was almost inconsequential. Even so, Diesel boats were today’s nucs. For their day, they were pinacle of technology. Not so today’s deisel boats – an attempt to buy cheap warfighting.

    And finally, it was Japan’s loss of her Carrier fleet and our ability to build a new one that decided the pacific.

    Germany was winning the war in the Altantic until we broke her communications code with the enigma machine. It was this one development more than anything else that caused her to loose in the Atlantic.

    Lots of moving parts and lessons to be learned in the events we both argue for our case. Who knows – maybe we’re both right.

    I do no this – as a 33 year submarine veteran – nothing beats a Nuclear Submarine in its element. Nothing.

    Tom

  6. CBD permalink
    March 4, 2010 4:13 pm

    Heretic,
    Well put. It should also be noted that the extra air and steel must be defended, so more defensive systems will be required to cover it all (adding expense, maintenance and manpower).

    Stealth shaping only helps so much…a larger vessel can be more readily shaped but also needs the shaping more to survive as well. Small vessels can also benefit from modest shaping as they can fully ‘disappear’ into the clutter with less effort — is simply less to hide. The electronics can all be accounted for, heat is masked with minimal effort and acoustic sources are few and known. The Hamina class ships are good examples of small ships that have minimal signatures across the board. The larger Visby goes further, but at greater expense.

  7. Mike Burleson permalink*
    March 4, 2010 9:46 am

    Tom, again I apologize for losing your comments. Here is my belated response:

    The idea that large multimission warships are better sea keepers, can remain longer on station, carry large weapons stocks is a given. No argument there.

    My argument is, the price of buying only these type ships have given us a smaller, over-worked fleet, that might be at risk in a future conflict because of its smaller numbers (you can only buy a handful of multi-billion dollar platforms naturally). Not taking attrition of platforms into account when a ship must perform the work of 4 previous vessels is a grave risk and doesn’t take the uncertain future into account.

    I disagree that small warships can’t do many functions now expected of only high end warships. The notion is historically without precedent. Small diesel submarines roamed the vast expanses of the Pacific when the battlefleet lay in ruins at Pearl Harbor and the aircraft carriers were steadily dwindling in numbers because of ATTRITION. At the height of the Guadalcanal Campaign we had only 1 barely operational USS Enterprise, so what ships took the lead in throwing back the Japanese but the smaller cruisers, destroyers, PT boats and diesel submarines?

    Your point is will taken that we can’t fight a war with only destroyers and cruisers (or frigates or coevettes) but imagine how even less capable we would be with only Aircraft Carriers! Without essential escorts the battleships cannot even leave port.

    Your historical reference toward small ships also fails to remember the small boys of 1000 ton corvettes and 1500 ton destroyer escorts that fought the Battle of the Atlantic. Back further In WW 1 and after Jutland, when the enemy refused to fight fair, resorting to submarine warfare, it was the destroyers (which were built to fight only small torpedo boats)which took the fight to the enemy, helping to preserve Western Civilization and keeping the Atlantic lifeline open.

    So because the Big Ships are so capable, as you contend and which I agree, we should be able to do more with less. Then we can spend stretched shipbuilding funds on building up ship numbers, because something a $10 billion aircraft carrier or $2 billion destroyer cannot do is be in more than one place at a time. But you cannot maintain sea control with battleships alone or even mostly large warships.

  8. Mike Burleson permalink*
    March 4, 2010 9:11 am

    Tom, for some reason your comments were going to the Spam folder. This happens a lot and I’m getting a little frustrated with WordPress as it is embarrassing to me.

  9. March 3, 2010 8:59 pm

    This is my second attempt to comment. I’d like to rebut the notion that a gaggle of inexpensive ships can be as effective as our current fleet. attend:

    – Inexpensive ships have a narrow range of missions. By that I mean, they have tiny fire control systems, fired by tiny generators, that launch one type of weapon system. Their hulls are thin, the crew small; they cannot fight when hurt.

    – When an U.S. Navy ship deploys overseas, it is thousands of miles away from a repair part or perhaps another friendly ship. What they need, they better bring with them.

    – Little tiny ships could work wonders in fighting off Somalia pirates; but thats not the next fight – its China. These little ships will be worthless when THAT cold war begins.

    – Little ships must await good weather. Not big ones.

    – A battle group can pretty much own the planet around them. A patrol boat; even an LCS, cannot do much of anything in a REAL battle.

    25 patrol boats against a small task force of say, 10 ships would be badly beaten.
    50 patrol boats against a small task force would have an equal result.
    100 patrol boats?

    And now Deisel Submarines. Batteries can drive you 4 knots submerged with a minimal amount of sonar and fire control running. After a hundred hours or so, they cant do much more than wait it out. Why would America send such a toy to the South China Sea?

    Alfred Mahan once wrote about bigger, more capable ships beating out a bevvy of smaller ones. A lesson we later learned in WW2 with Aircraft Carriers. Imagine us attempting to win that war with just Destroyers and Cruisers?

    Just a few thoughts
    Tom Desrosier
    http://www.dare2believe.com

  10. Heretic permalink
    March 3, 2010 11:02 am

    re: steel is cheap, and air is free.

    Cheap to build, but requires more manpower to maintain … and that manpower isn’t “free” in any sense of the word. And the air is “free” to the builder, but isn’t “free” when it comes to environmental control(s) … which also need to be maintained, and also add to the energy load/overhead costs of actually owning and operating a ship.

    You’re right as far as purchasing costs go, for the most part … but that isn’t the end of the story when it comes to life cycle and ownership costs in terms of manning and maintenance. Going “big” does impose its own costs, although admittedly not as much of a cost as adding electronics and weapon systems does.

    re: Contracting the Swedes

    Getting Kockums to build some of those fibreglass foam core hulled ships for the USN would be absolutely sweet. I keep wondering how good that hull technology is in a pressure hull application for AIP submarines … and how long it’s going to take before we start seeing conventional submarines made out of the stuff.

  11. Mike Burleson permalink*
    March 3, 2010 8:38 am

    “we did very well after that with a few capital ships (aircraft carriers and BBs) and many, many smaller hulls”

    Exactly! those small boys held the line until new construction came into the fleet. Early in a conflict, naturally you have attrition with all classes, so a large fleet is essential. I fear the Navy thinks all future wars will be like Korea, Vietnam, and Iraq, where no one was shooting at your Big Ships and you can take your sea control for granted.

    But I don’t want to deplete the fleet of high end assets, as I am often accused, just get our priorities in sync with reality.

  12. CBD permalink
    March 3, 2010 7:36 am

    Mike,
    I recently posted a little note in the warship costs thread about a poster (from AMI) who was claiming that LCS built in any European yard would likely have been more expensive…not sure if I buy his logic, but there are clearly a few with pricing experience who have the opposite perspective.

    Personally, I wouldn’ t mind a rebalancing of the fleet for the exact same reason you give: we found out at Pearl Harbor how difficult it was to have half of our eggs/battleships in one basket and then have that basket drop. It should also be noted that we did very well after that with a few capital ships (aircraft carriers and BBs) and many, many smaller hulls.

  13. Mike Burleson permalink*
    March 3, 2010 5:58 am

    Graham asked “How would you feel about opening up competition for military ship-building contracts to the Swedes, Germans, Japanese & South Koreans?”

    That is a touchy subject, with the US Congress being the biggest hindrance. I certainly see their point of view and I am as patriotic as the next guy, but if I have to choose between national security and jobs, I would easily pick security. As with foreign made cars, the influx of competition doesn’t seem to have hurt manufacturing here. We still have Ford and Chevrolet going strong.

    It is hard to get past the notion that ships built overseas are too often costing in the hundreds of millions while we build in the billions. Had the LCS been designed and built in Denmark for instance, it would doubtless come in at is original price of $220 million, maybe less. In contrast had Absalon been constructed in the USA, it would probably weighed in closer to the 10,000 tons and about the same cost of a Burke destroyer. I don’t think I am exaggerating here. It is that bad.

    And we build in quantity, which you would think lower the price. Not hardly. It gets worse every year, ships get bigger and pricier, quantity falls. The fleet is on a self induced death spiral. The only thing that will save it is a back to basics, a slimming down. Not of ships numbers, 1 ship doing the work of 4, because that means you must also make the crew work 4 times as hard.

    Reducing the size of warships, all classes and categories would produce big savings, and they are not more vulnerable. Because you have more of them there would be more threats for the enemy to have to contend with, also you would have more presence and launch platforms for new weapons. It’s the same thing we learned in World War 2, that bigger wasn’t always better. But sadly we had to learn that the HARD WAY. I’d hate to see that happen a second time.

  14. Graham Strouse permalink
    March 2, 2010 11:13 pm

    Mike,

    How would you feel about opening up competition for military ship-building contracts to the Swedes, Germans, Japanese & South Koreans? I’m not a big fan of unrestrained globalism broadly, but when it comes to critical areas such as defense, I think that challenging US manufacturers with best-in-the-world firms might help wake up our own industries…and reduce costs and improve product quality.

    We already buy from the Israelis so we’re not Simon Pure when it comes to “America First.” Why not expand ship-building competition.

    Look at it this way, when confronted by serious global automotive competition and limited national support, Ford finally stepped it up. Toyota, briefly #1, is foundering. Maybe we need a little international juice to keep our military builders on their toes too…

  15. Graham Strouse permalink
    March 2, 2010 7:51 pm

    @Scott B.,

    “404 Missile Not Found”

  16. Scott B. permalink
    March 2, 2010 5:50 pm

    B. Smitty said : “You need a blog. ;)”

    Too many black helos orbiting in my life already !!! ;-(

  17. B.Smitty permalink
    March 2, 2010 5:31 pm

    Scott B,

    You need a blog. ;)

    You already have a few month’s worth of material buried in various posts here and elsewhere.

    I’d subscribe.

  18. Scott B. permalink
    March 2, 2010 4:56 pm

    Mike Burleson said : “I am prepared to see us go to shipbuilding like we do cars. I think here is where even Scott would agree, and I place the Scandinavians, especially the Danes up there with the Koreans.”

    One of Deng Xioaping’s favorite Sichuanese proverbs was :

    “It does not matter if a cat is black or white as long as it catches mice”

    ;-))

  19. Scott B. permalink
    March 2, 2010 4:44 pm

    Oh, one last thing.

    Before we get yet another comment suggesting that THINKING BIG, not small means *keeping on doing what we’ve been doing*, here is what the way to go should look like :

    ABSALON (of course)

    Big enough yet affordable : this is the real gist of the THINK BIG, not small philosophy !!!

  20. Scott B. permalink
    March 2, 2010 4:33 pm

    Mike Burleson said : “Someone asked why call for smaller, less capable warships?”

    On more comment on the *small is beautiful* mantra.

    What I have observed over the years is that virtually all of the *small is beautiful* proponents tend to invert the causality between *big* and *sophisticated*.

    The causality is this : it’s big because it is sophisticated, and not the other way around. IOW, being big is merely a consequence of being sophisticated.

    Which has an interesting implication : because it’s big doesn’t necessarily mean that it will be sophisticated. IOW, being sophisticated is not necessarily the consequence of being big.

    Once you get the causality right, the next move is this : steel is cheap, and air is free.

    Since being *big* :

    1) offers much benefits on each of the 10 critical platform-centric attributes defined by Dr. Dalsjö,

    2) doesn’t necessarily mean expensive

    There isn’t any point in buying smaller ships, as Dr. Friedman explained back in 1999.

    From there, the only way to go is this : THINK BIG, not small !!!

  21. Scott B. permalink
    March 2, 2010 4:12 pm

    Mike Burleson said : “Someone asked why call for smaller, less capable warships? The above chart from the Congressional Budget Office, helps explain my thinking.”

    There’s nothing in the CBO study that may support, even mildly, the *small is beautiful* mantra.

    When you take a look at the comments that come with Table 2 in the CBO study, Dr Labs cites 3 main reasons (the 3 I’s) to explain the rise in average ship costs :

    1) Increased sophistication (improved capabilities).

    2) Inflation (but the figures in Table are in constant dollars, i.e. adjusted for inflation).

    3) Insufficient quantities to absorb fixed overhead costs.

    So, on the basis of the CBO study, one could make the case for :

    1) Less sophisticated warships, which doesn’t necessarily mean smaller warships as you keep suggesting : in fact, to illustrate this point, Dr. Labs cites the Spruance vs the Burkes, and it’s obvious that the latter weren’t much smaller than the former (FLD of 9,063 tons for USS Spruance, DD-963, vs 9,200 tons for USS Michael Murphy, DDG-112).

    OR (in the inclusive sense)

    2) More numerous warships (or more precisely increased production runs) to better absorb fixed overhead costs.

    A quick & dirty extrapolation of the figures given in Dr. Labs’ study would show that, leaving inflation aside, about half of the rise in average ship costs might be due to increased capabilities and another half to the under-absorption of fixed overhead costs.

    On a sidenote, it’s a pity Dr. Labs didn’t actually try provide an accurate ponderation of the 3 causes he suggests to explain the rise in average ship costs, because he had all the information to do so. Maybe in another report…

  22. Mike Burleson permalink*
    March 2, 2010 4:04 pm

    Matthew said “The South Korean shipping industry is #1 in the world, I think we could stand to learn from them.”

    I am prepared to see us go to shipbuilding like we do cars. I think here is where even Scott would agree, and I place the Scandinavians, especially the Danes up there with the Koreans.

  23. Jed permalink
    March 2, 2010 3:30 pm

    Mathew – the difference is the the threat to South Korea is North Korea, so patrol boats, missile boats and corvettes are fine. They have only really just moved into ‘blue water’ operations with their very nice frigate and destroyer designs.

    Unless the USA gave up global role, and the Canadians and Mexicans suddenly became the main threat to the USA, then have a navy of missile boats and corvettes would not really fit the bill – so the comparison is a bit “apples to oranges” I’m afraid.

  24. Matthew S. permalink
    March 2, 2010 3:01 pm

    Im starting to come around to your side Mike, not so much at the expense of these larger ships though. I think the South Korean navy is getting it right with so many patrol boats and corvettes. I think something like the following would be useful for the USN…

    http://en.wikipedia.org/wiki/Gumdoksuri_class_patrol_vessel

    The South Korean shipping industry is #1 in the world, I think we could stand to learn from them.

  25. Scott B. permalink
    March 2, 2010 2:41 pm

    Mike Burleson said : “My point is, thanks to the flexibility and capability of modern weapons, especially the Aegis system, and the enhanced accuracy of modern weapons like Standard SAMs and Tomahawk cruise missiles, you can build smaller ships, at less cost, more of them, without losing capability.”

    AEGIS, Standard Missiles (SM-2) and Tomahawks have been around since the early 1980s in the US Navy, and the latest variants, though still among the very best in class, are not technological breakthroughs, merely evolutionary designs.

    The technological breakthroughs that could make your logic valid, i.e. *get more bangs with less bucks*, didn’t really happen so far. In fact, the stubborn pursuit of such technological breakthroughs (under the label of *transformation*) is one of the main reasons why so many weapon programs spun out of control from a budget POV, while delivering relatively mediocre performances.

    IOW, like I told you sooo many times, you’re still trying to run the exact same flawed software that led to repeated system crashes. Merely re-booting the system won’t remove the bugs from the software !!!

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