Sailors of the USS Richard M. McCool Jr. stand at attention during the ship’s commissioning ceremony at Naval Air Station Pensacola, Fla., Sept. 7, 2024. (EJ Hersom/U.S. Defense Department)
WASHINGTON — The Navy’s approach to managing the shipbuilding industry is ineffective as ships face lengthy construction delays, according to a new federal watchdog report.
“These problems are in part because the ship industrial base faces workforce and infrastructure challenges that put the Navy’s goals out of reach. Yet, the Navy continues to expect different performance outcomes in the coming years than it has achieved in the past,” according to a report published Thursday by the Government Accountability Office.
The Navy, which relies on contracted private shipbuilding companies, planned to have a battle force of 313 ships by 2025. But in its fiscal 2025 shipbuilding plan, the Navy said the service will have 287 ships by 2025 — 26 fewer ships than expected.
From 2019-2023, the Navy planned for the delivery of 11 new Virginia-class submarines and 15 new Arleigh Burke-class destroyers. Only four of those submarines and seven of the destroyers were delivered. Additionally, the report found 37 out of 45 — or 85% — of ships now under construction are facing delays ranging from five months to more than three years.
For years, shipbuilders have said they need a stable industrial base to hire and retain a workforce and invest in shipyard infrastructure. The Navy has tried to reassure the shipbuilding industry through long-range planning, seeking the funds for future ships years in advance.
“However, our analysis of the Navy’s shipbuilding plans for fiscal years 2019 through 2025 found that the Navy made significant changes to these plans from year to year, resulting in an unreliable signal of shipbuilding demand,” the report read.
The Navy planned in 2019 to procure 11 ships in fiscal 2025. But under its fiscal 2025 plan, the Navy reduced its procurement plans to six ships. In its 2024 plan, the Navy envisioned purchasing as many as 35 next-generation attack submarines but has since proposed buying just 14 of those vessels.
Enduring changes, the report read, require a strategic, rather than reactive, approach that aligns with the National Defense Industrial Strategy. The Defense Department’s industrial strategy was first released last year to guide the department’s policy development and investment in the industrial base in three- to five-year increments.
“As such, developing a strategy to motivate the ship industrial base to perform better — including goals and the resources it needs to achieve them — will help the Navy break a cycle of poor performance that has stifled the growth and modernization of the fleet for decades,” the report reads.
The GAO made six recommendations to the Navy and the Defense Department that include improving visibility across investments and establishing metrics for investments, and creating a ship industrial base strategy. Additionally, Navy leaders and the Office of the Secretary of Defense should better coordinate shipbuilding investments to ensure there are no duplicate investments, the report reads.
The watchdog report was released as John Phelan, the nominee to be the next Navy secretary, testified before the Senate Armed Services Committee about how he would use his background in the private sector to “step outside the status quo,” if he is confirmed, to tackling issues such as shipbuilding and recruitment. A businessman with no military experience, Phelan is “not a traditional” candidate, multiple lawmakers have said.
“You are a non-traditional appointee for this position, and that can be OK if the tradition is not working,” said Sen. Tim Kaine, D-Va., who introduced the GAO report during the hearing. “I think the punchline in this report is the tradition isn’t working.”
Kaine, who is the top Democrat on the Senate’s subcommittee on sea power, said it was his assumption that if Congress provides the funds, the Navy and the private sector will deliver the ships. The Defense Department spent more than $5.8 billion from 2014-2023 to support the shipbuilding industrial base, with plans to spend an additional $12.6 billion through fiscal 2028.
“Putting more money into the bucket without changing how we are doing things — I now have completely lost confidence that that is going to solve the problem,” Kaine said.
