Cost increases on the composite deckhouse and hangar for the first ship of the Zumwalt-class destroyer (DDG-1000) program have in part prompted the Navy to hold a competition for the possible use of steel to build the structures for the third vessel, the service said.
The Navy has yet to decide on whether to pursue the steel alternative since it opened the competition in February, and is still in negotiations with Huntington Ingalls Industries [HII] to lower the cost of the composite deckhouse, hangar and aft peripheral vertical launching system (PVLS), the service said.
The decision on using steel on the third ship, the DDG-1002, will occur in the next few months–or “very soon,” Capt. Jim Downey, the program manager for the DDG-1000, told Defense Daily in a brief interview last week. “The competition is underway right now,” he said.
In a written response to previously submitted questions, Downey said it was necessary to create a second track for the deckhouse, hangar and PVLS because the negotiations with Huntington Ingalls Industries so far have not reached an agreement.
“Negotiations between the Navy and HII for the DDG-1002 work have been ongoing for more than a year,” Downey said. “Because the sole source negotiations have not reached an affordable solution and deliveries of these components for DDG-1002 are becoming time critical, the Navy is pursuing a steel deckhouse/hangar/Aft PVLS limited competition in parallel.”
Naval Sea Systems Command (NAVSEA) refused to provide the amount of the cost increase for the composite structures. Spokesman Chris Johnson said that information can’t be released because of sensitivities in the ongoing negotiations with Huntington Ingalls Industries and in the competition.
Downey said additional cost growth in the construction of the first ship has also been experienced at General Dynamics [GD] Bath Iron Works, which is building the hull. He said the increases were typical for the first ship of a class.
“Cost increases on the first ship are primarily attributed to construction of the lead ship at Bath Iron Works (BIW) and completion of the lead ship hangar, deckhouse and aft peripheral vertical launching system (PVLS) at Huntington Ingalls Industries (HII),” he said.
General Dynamics and Huntington Ingalls Industries are two of the four prime contractors on the DDG-1000 program. The others are Raytheon [RTN] and BAE Systems.
Downey said the deckhouse took four to six months longer to complete than expected due to the complexities of using composites. The composites required rework in some areas, such as on box beams, and drove up labor expenses, he said.
“There was no material growth, there weren’t things like that,” he said in the interview at the Sea-Air-Space exposition. “There was cost related to the rework of the composites. This is the first time a (composite) structure that size was ever built.”
The Navy originally went with the composite structures to save weight on the ship. Downey said, however, that shifting to the heavier steel won’t be a problem because the ships are coming in about 100,000 pounds lighter than expected.
“Steel is cheaper to build with,” he said, adding the “savings offset the weight.”
Downey said the program is not in danger of violating the Nunn-McCurdy Act, which calls for congressional notification and possible restructuring if cost increases breach 15 percent. The program underwent the Nunn-McCurdy process in 2010 after the Navy truncated it from 10 to three ships, causing per unit costs to rise.
“The Navy is not experiencing cost increases that would trigger a new (Nunn-McCurdy) breach and no funding has been shifted within the program to avoid a (Nunn-McCurdy) cost threshold breach,” Downey said in his written responses.
Some of the cost increases have been offset by savings in other areas of the program, and that overall it is coming in at about 6.8 percent below the acquisition program baseline (APD) estimate furnished in March 2011, Downey said. That percentage is based on the select acquisition report (SAR) published in December of 2011.
The second ship, the DDG-1001, is also being built with a composite deckhouse, hangar and PVLS. Downey said despite the challenges, “the Navy has seen significant learning on the DDG-1001 deckhouse and hangar related to composite production.”
A spokesman for Huntington Ingalls Industries, Bill Glenn, said the contractor “continues to perform well” on the composite structures for the DDG- 1000s and was applying the experience to the second ship.
“We demonstrated considerable improvement from the first set of class products to the second set and we are committed to working closely with the Navy to complete our work on DDG-1001 by the first quarter of 2014,” he said.
The DDG-1000, the future USS Zumwalt, is scheduled to deliver in 2014. The Navy issued $1.8 billion in hull construction contracts to General Dynamics in 2011 for the remaining two ships planned, the futures USS Michael Monsoor (DDG-1001) and Lyndon B. Johnson (DDG-1002), are scheduled to deliver in 2015 and 2018.
The Navy has not issued a contract to Huntington Ingalls Industries for a composite deckhouse, hangar and PVLS for the DDG-1002.