Navy Maintenance

Cost Growth and Schedule Overrun Problems Continue at the Shipyards Gao ID: NSIAD-90-144 July 24, 1990

Pursuant to a congressional request, GAO reviewed the Navy's costs to overhaul and repair ships at public and private shipyards, focusing on the: (1) extent of cost growth and schedule overruns at both public and private shipyards; and (2) causes of the increases.

GAO found that: (1) contract costs increased from $2.8 billion to $3.7 billion between 1985 and 1988; (2) at private shipyards, cost growth averaged 31 percent and schedule overruns averaged 43 days; (3) at public shipyards, cost growth averaged 3 percent and schedule overruns averaged 81 days; (4) at private shipyards, inadequate and late government-furnished information and materials were among the major causes of contract cost growth and schedule overruns on 23 contracts; (5) government-caused delays and disruptions to contractors also result in cost growth and schedule overruns; (6) when a public shipyard becomes overloaded and has insufficient workers to properly execute the work load, cost growth and schedule overruns result; (7) public shipyards cited poorly defined work packages and poorly prepared drawings and specifications as causes for cost growth and schedule overruns; and (8) making major alterations on ships as quickly as possible was more important than the additional costs that resulted from poorly defined work packages.


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