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Thursday, October 17, 2013

Navy Littoral Combat Ship (LCS) Program: Background and Issues for Congress

Ronald O'Rourke
Specialist in Naval Affairs

The Littoral Combat Ship (LCS) is a relatively inexpensive Navy surface combatant equipped with modular “plug-and-fight” mission packages for countering mines, small boats, and dieselelectric submarines, particularly in littoral (i.e., near-shore) waters. Navy plans call for fielding a total force of 52 LCSs. Twelve LCSs were funded from FY2005 through FY2012. Another four (LCSs 13 through 16) were funded in FY2013, although funding for those four ships has been reduced by the March 1, 2013, sequester on FY2013 funding. The Navy’s proposed FY2014 budget requests $1,793.0 million for four more LCSs (LCSs 17 through 20), or an average of about $448 million per ship.

Two very different LCS designs are being built. One was developed by an industry team led by Lockheed; the other was developed by an industry team that was led by General Dynamics. The Lockheed design is built at the Marinette Marine shipyard at Marinette, WI; the General Dynamics design is built at the Austal USA shipyard at Mobile, AL. LCSs 1, 3, 5, and so on are Marinette Marine-built ships; LCSs 2, 4, 6, and so on are Austal-built ships.

The 20 LCSs procured or scheduled for procurement in FY2010-FY2015 (LCSs 5 through 24) are being procured under a pair of 10-ship, fixed-price incentive (FPI) block buy contracts that the Navy awarded to Lockheed and Austal USA on December 29, 2010.

The LCS program has become controversial due to past cost growth, design and construction issues with the lead ships built to each design, concerns over the ships’ ability to withstand battle damage, and concerns over whether the ships are sufficiently armed and would be able to perform their stated missions effectively. Some observers, citing one or more of these issues, have proposed truncating the LCS program to either 24 ships (i.e., stopping procurement after procuring all the ships covered under the two block buy contracts) or to some other number well short of 52. Other observers have proposed down selecting to a single LCS design (i.e., continuing production of only one of the two designs) after the 24
th ship.

In response to criticisms of the LCS program, the Navy has acknowledged certain problems and stated that it was taking action to correct them, disputed other arguments made against the program, and maintained its support for completing the planned program of 52 ships. Reported comments from some Navy officials suggest that the Navy might be open to changing the design of one or both LCS variants after the 24
th ship or perhaps down selecting to a single LCS design after the 24th ship.

A September 2, 2013, press report stated, “The office of the Secretary of Defense (OSD) reportedly supports the idea of limiting total purchases of littoral combat ships to only 24.... The Navy, according to sources, is countering with proposals for higher numbers, but strongly advocates going no lower than 32 ships.... The OSD proposal to limit LCS to 24 ships is understood to be part of” an alternative Department of Defense (DOD) budget plan that assumes reduced levels of DOD spending and includes “severe reductions in purchases and programs.”

Issues for Congress concerning the LCS program include the following:

  • the impact on the LCS program of the March 1, 2013, sequester on FY2013 funding and unobligated prior-year funding for the program; 
  • the potential impact on the LCS program of a possible sequester later this year or early next year on FY2014 funding and unobligated prior-year funding for the program;
  • whether to truncate the LCS program to 24 ships or some other number well short of 52;
  • whether procurement of LCS sea frames and mission modules should be slowed until operational testing of the sea frames and mission modules is more complete and other acquisition-process milestones are met;
  • whether to down select to a single LCS design after the 24th ship;
  • technical risk in the LCS program; and
  • what defense-acquisition policy lessons, if any, the LCS program may offer to policymakers.

Date of Report: September 27, 2013
Number of Pages: 95
Order Number: RL33741
Price: $29.95

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