Navy's Aircraft Carrier Program

The 1993 Bottom-Up Review--an evaluation of the nation's defense strategy, force structure, and modernization done in response to the end of the Cold War and the dissolution of the Soviet Union--concluded that a force of 10 aircraft carriers could meet the military's war-fighting requirements but that 12 carriers were needed for sufficient overseas presence. The Bottom-Up Review recommended that construction of CVN-76 begin in fiscal year 1995 to maintain the 12-carriers force structure, allow flexibility in the carriers force size, avoid cost increases arising from a construction delay, and preserve the industrial base at Newport News Shipbuilding. This staff study supplements GAO's April 1994 testimony (GAO/T-NSIAD-94-171) on the affordability of several carrier force structure investment alternatives to begin building CVN-76 in fiscal year 1995. The staff study discusses the budget implications of a wide range of options for meeting the Bottom-Up Review force structure requirement for 12 carriers, including the purchase of conventionally powered carriers instead of nuclear-powered carriers. It also discusses each option's effect on employment levels at Newport New Shipbuilding.

GAO found that: (1) there are several available options for maintaining the 12-carrier force at less cost than projected in the BUR and the Navy Recapitalization Plan; (2) the least expensive option maintains employment levels at or above minimum levels, authorizes building the proposed nuclear carrier in fiscal year 1995, switches to construction of conventionally powered carriers in later years, and would cost 25 percent less than the BUR and Navy Recapitalization Plan options; (3) options to build CVN-76 in fiscal year 1995 would stop the downward trend in employment at about the minimum sustaining employment level of 10,000 employees, require building carriers sooner than they are needed for force structure purposes, and incur expenses sooner than necessary; (4) options to delay building the carrier would result in a continuing decline in employment to about 7,500 employees; (5) in the long term the employment levels in the BUR and the Navy Recapitalization Plan also fall below 10,000 employees; (6) the option to build nuclear carriers at the historical rate of one every 3 years maintains stable employment levels but costs about 40 percent more than the options in the BUR and the Navy Recapitalization Plan; (7) options for using carriers for their full service lives are less expensive than those in the BUR and Navy Recapitalization Plan, but in the near term the employment levels fall below the minimum sustaining level; (8) a transition to constructing conventionally powered carriers would save the largest amount of investment resources; and (9) criteria for comparing nuclear and conventional carriers include affordability, operational effectiveness, potential utilization, availability of homeports and shipyards for maintenance, and supporting infrastructure such as training and disposal of nuclear materials.