Order Code RL32109
Navy DDG-1000 Destroyer Program: Background,
Oversight Issues, and Options for Congress
Updated July 15, 2008
Ronald O’Rourke
Specialist in Naval Affairs
Foreign Affairs, Defense, and Trade Division

Navy DDG-1000 Destroyer Program: Background,
Oversight Issues, and Options for Congress
Summary
The Navy is procuring a new kind of destroyer called the DDG-1000. The ship
is also known as the Zumwalt class destroyer, and was earlier called the DD(X).
Navy budget plans call for procuring a total of seven DDG-1000s. The first two were
procured in FY2007 using split funding (i.e., two-year incremental funding) in
FY2007 and FY2008. The Navy estimates their combined procurement cost at
$6,325 million. This figure includes about $1.9 billion in detailed design/non-
recurring engineering (DD/NRE) costs for the entire DDG-1000 class.
The Navy’s proposed FY2009 budget requests funding to procure the third
DDG-1000 in FY2009; the Navy estimates its procurement cost at $2,653 million.
The ship received $150 million in advance procurement funding in FY2008, and the
Navy’s proposed FY2009 budget requests the remaining $2,503 million. The Navy’s
proposed FY2009 budget also requests $51 million in advance procurement funding
for the fourth DDG-1000, which the Navy budget plans call for procuring in FY2010.
On July 14, 2008, defense trade publications reported that Navy leaders have
recently changed their thinking and now support ending procurement of DDG-1000s
with the two ships already procured and restarting procurement of Arleigh Burke
(DDG-51) class destroyers, which were most recently procured in FY2005. The
trade publication Inside the Navy, for example, reported on July 14 that: “In a
dramatic, behind-the-scenes about-face, the Navy is rescinding support for its
Zumwalt-class DDG-1000 destroyer program, seeking to persuade Pentagon leaders
to limit the program to two ships and resume construction of Arleigh Burke-class
DDG-51 destroyers.... Industry sources say the Navy is interested in completing the
first two DDG-1000s and then buying 11 new DDG-51s, which would mean
reopening production lines for the Arleigh Burkes.”
The House Armed Services Committee, in its report (H.Rept. 110-652 of May
16, 2008) on the FY2009 defense authorization bill (H.R. 5658), recommended
reducing the Navy’s request for FY2009 DDG-1000 procurement funding from
$2,503 million to zero, and increasing the Navy’s FY2009 request for DDG-1000
advance procurement funding from $51 million to $400 million. The report states
that the $400 million is to be used either for construction of DDG-1000s or for
restarting construction of Arleigh Burke (DDG-51) class destroyers, which were last
procured in FY2005. The Senate Armed Services Committee, in its report (S.Rept.
110-335 of May 12, 2008) on the FY2009 defense authorization bill (S. 3001),
recommended approval of the Navy’s requests for FY2009 procurement and advance
procurement funding for the DDG-1000 program.
The DDG-1000 program raises several potential oversight issues for Congress,
including the accuracy of Navy cost estimates for the program, program affordability
and cost effectiveness, technical risk, and the program’s potential implications for the
shipbuilding industrial base. Congress has several options regarding the DDG-1000
program. This report will be updated as events warrant.

Contents
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Issue for Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
July 14, 2008, Press Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Statements at February and March House Hearings . . . . . . . . . . . . . . . . . . . 4
Reports of House and Senate Armed Services Committees . . . . . . . . . . . . . 5
Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
DDG-1000 Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Surface Combatant Industrial Base . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Oversight Issues for Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Accuracy of Navy Cost Estimate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Program Affordability and Cost Effectiveness . . . . . . . . . . . . . . . . . . . . . . 16
Technical Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Industrial Base . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Options for Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
List of Potential Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Deferring DDG-1000s and Procuring Other Ships Instead . . . . . . . . . . . . . 24
FY2009 Legislative Activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
FY2009 Defense Authorization Bill (H.R. 5658/S. 3001) . . . . . . . . . . . . . . 27
Appendix A. DDG-1000 Mission Requirements . . . . . . . . . . . . . . . . . . . . . . . . . 29
Appendix B. Comparisons of DDG-1000 and DDG-51 . . . . . . . . . . . . . . . . . . . 35
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
July 19, 2005, Navy Testimony . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
June 10, 2005, Navy Briefing to CRS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
April 10, 2008, Navy Briefing to CRS and CBO . . . . . . . . . . . . . . . . . . . . . 40
May 7, 2008, Navy Letter to Senator Kennedy . . . . . . . . . . . . . . . . . . . . . . 41
July 2, 2008, DOD letter to Representative Taylor . . . . . . . . . . . . . . . . . . . 43
Appendix C. Potential Lower-Cost Ships . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
List of Tables
Table 1. Actual and Planned DDG-1000 Procurement . . . . . . . . . . . . . . . . . . . . . 7
Table 2. DDG-1000 Program Funding, FY2002-FY2013 . . . . . . . . . . . . . . . . . . 8
Table 3. Congressional Action on FY2009 Funding Request . . . . . . . . . . . . . . 27
Table 4. DDG-1000 Capabilities Relative to DDG-51 Capabilities . . . . . . . . . . 41
Table 5. Alternative with LPD (AGS) and Smaller Cruiser-Destroyer . . . . . . . 48
Table 6. Alternative with Smaller Cruiser-Destroyer . . . . . . . . . . . . . . . . . . . . . 49

Navy DDG-1000 Destroyer Program:
Background, Oversight Issues, and Options
for Congress
Introduction
The Navy is procuring a new kind of destroyer called the DDG-1000. The ship
is also known as the Zumwalt class destroyer, and was earlier called the DD(X).
Navy budget plans call for procuring a total of seven DDG-1000s. The first two were
procured in FY2007 using split funding (i.e., two-year incremental funding) in
FY2007 and FY2008. The Navy estimates their combined procurement cost at
$6,325 million. This figure includes about $1.9 billion in detailed design/non-
recurring engineering (DD/NRE) costs for the entire DDG-1000 class.
The Navy’s proposed FY2009 budget requests funding to procure the third
DDG-1000 in FY2009; the Navy estimates its procurement cost at $2,653 million.
The ship received $150 million in advance procurement funding in FY2008, and the
Navy’s proposed FY2009 budget requests the remaining $2,503 million. The Navy’s
proposed FY2009 budget also requests $51 million in advance procurement funding
for the fourth DDG-1000, which the Navy budget plans call for procuring in FY2010.
Issue for Congress
The issue for Congress is whether to approve, modify, or reject the Navy’s
proposals for the DDG-1000 program. Decisions that Congress makes on
procurement of surface combatants will significantly affect future Navy capabilities,
Navy funding requirements, and the shipbuilding industrial base.
July 14, 2008, Press Reports
On July 14, 2008, defense trade publications reported that Navy leaders have
recently changed their thinking and now support ending procurement of DDG-1000s
with the two ships already procured and restarting procurement of Arleigh Burke
(DDG-51) class destroyers, which were most recently procured in FY2005.
The defense trade publication Inside the Navy reported on July 14 that:
In a dramatic, behind-the-scenes about-face, the Navy is rescinding support
for its Zumwalt-class DDG-1000 destroyer program, seeking to persuade
Pentagon leaders to limit the program to two ships and resume construction of
Arleigh Burke-class DDG-51 destroyers, Inside the Navy has learned.

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Chief of Naval Operations Adm. Gary Roughead and Navy Secretary
Donald Winter were scheduled to meet with officials in the Office of the
Secretary of Defense [OSD] to discuss DDG-1000 on Thursday, July 10. But
industry and Pentagon sources confirmed the big meeting was postponed because
Pentagon acquisition chief John Young was tied up with a lengthy congressional
hearing on the Air Force tanker debacle.
Industry sources say the Navy is interested in completing the first two
DDG-1000s and then buying 11 new DDG-51s, which would mean reopening
production lines for the Arleigh Burkes.
By advocating this approach, Roughead is breaking with a long tradition of
strong Navy support for the next-generation destroyer program, also known in
past years as DD(X) and DD-21.
Chairman of the Joint Chiefs of Staff Adm. Michael Mullen, who led the
Navy before Roughead, told reporters in March 2007 that the sea service did not
need more DDG-51s.
“That’s moving me back to the 1980’s technology,” he said at the time.
Young, who formerly served as the Navy’s acquisition chief, has recently
defended the DDG-1000 program and slammed the idea of resuming DDG-51
construction.
Publicly, the Navy is not yet ready to admit its position. Navy spokesman
Cmdr. Jeff Davis declined to comment.
But industry sources say Roughead appears determined to set his own
course for the Navy and that he does not see the need to buy seven DDG-1000s.
Under the Navy’s proposal, the first two DDG-1000s would provide
opportunities to cultivate technologies that could be incorporated later in other
vessels, an aspect of the program Roughead has touted before.
“But what the DDG-1000 brings to our Navy and the two ships that we put
on contract recently is an introduction of new technologies that will be very
important to how we go forward,” he told Senate appropriators during a March
5 hearing.
Roughead is also allying himself with the House Armed Services
Committee, which has made similar recommendations to curtail DDG-1000 plans
and restart DDG-51 production....
The DDG-1000 meeting, which was supposed to be chaired by Deputy
Defense Secretary Gordon England, is likely to be rescheduled for the week of
July 21, these sources said.
The timing of the meeting happens to fall just after the Navy is due to
submit its fiscal year 2010 budget proposal to OSD.
An industry source said the FY-10 budget submission probably would not
include the plan to change the DDG-1000 program of record because the Navy
has not yet received any approval from OSD. The plan could be revised later if

CRS-3
OSD gives consent, or if Congress changes the fate of DDG-1000 in FY-09
defense policy and spending legislation.
On July 31, Navy officials are slated to testify before a House panel about
DDG-1000.
“The purpose of the hearing is for the subcommittee to better understand
the warfighting requirements and acquisition costs of either continuing the
Zumwalt-class DDG-1000 destroyer program, returning to procurement of
Burke-class DDG-51 destroyers, or a combination of the two,” Rep. Gene Taylor
(D-MS), chairman of the House Armed Services seapower and expeditionary
forces subcommitee, writes in a July 7 letter to Winter.
A July 2 letter that Young penned to Taylor strongly defends the
DDG-1000 program, illustrating the resistance the Navy faces from OSD.
Young writes that he “remains convinced” that the DDG-1000 program is
“poised for proper execution.” Restarting the DDG-51 program would “pose risk
to the shipbuilding budget and inject additional cost,” Young complains in the
missive.
Young concedes the DDG-1000 hull cannot support the most capable radars
under consideration for the future cruiser known as CG(X), arguing the same is
true for the DDG-51 hull. And the DDG-1000 hull can still support more capable
radar suites than the DDG-51 hull, the letter states.1
The defense trade publication Defense News similarly reported on July 14 that:
Indications are growing that the U.S. Navy is poised to forego further
construction of the advanced but very expensive DDG 1000 Zumwalt-class
destroyers and end the program at two ships....
On the record, Navy officials are mum about their plans. Service support
for the DDG 1000 program has been lukewarm at best, and while publicly
supporting the ships, Navy leaders behind the scenes have worked halt further
production.
The move still awaits blessing from on high, sources said, including
approval from Defense Secretary Robert Gates and the White House.
Chief of Naval Operations Adm. Gary Roughead “holds his cards real
close,” said one Congressional source. “But read the body language. He knows
he’s in trouble with the DDG 1000s. That ship is going to cost anywhere from
$1.5 billion to $3 billion more than advertised. And when that happens there’s
no slush fund. The only billpayer is Navy shipbuilding.”
The Navy, said the Congressional source, needs to protect other programs
such as submarine and littoral combat ships from being cut to pay for potential
DDG 1000 cost overruns.
1 Christopher J. Castelli, “In Major Reversal, Navy Aims To Curtail DDG-1000 Destroyer
Program,” Inside the Navy, July 14, 2008.

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Instead of the big destroyer, the Navy also hopes to protect the CG(X)
cruiser, a bigger combatant designed to protect aircraft carrier battle groups and
provide ballistic missile defense.
Roughead, the Congressional source said, “has his eyes on the cruiser. He’s
trying to make sure that ship is a national asset,” the source said.
But the cruiser won’t be ready to build anytime soon. Navy plans officially
call for the first ship to be funded in 2011, but no design has been chosen and
leaders admit the CG(X) will be delayed — at least to 2015, some say, and
maybe beyond....
The Navy in past years steadfastly argued against more DDG 51s, but
service leaders seemingly have had a change of heart. In March, then-Navy
acquisition chief John Thackrah confirmed the service was analyzing the
construction of more DDG 51s, and Roughead — in private — seems to have
embraced the idea as well....
A Navy official would not confirm the moves to curtail DDG 1000
production at two ships, but noted the need to protect other shipbuilding
programs.
“We need traction and stability in our combatant lines to reach 313 ships,
and we should not raid the combatant line to fund other shipbuilding priorities,”
Lt. Clayton Doss, a Navy spokesman at the Pentagon, said July 14.
Doss noted the program of record remains in place for DDG 1000, and
Congress has yet to pass a new defense bill.
“Until the 2009 National Defense Act is signed by the president it is
inappropriate to comment,” Doss said.
Work on the new Program Objective Memorandum [POM] for [FY]2010
— a key budget-planning document — is ongoing, Doss said. “Service inputs are
to be submitted to the Office of the Secretary of Defense later this month. While
it would be inappropriate to discuss internal budget discussions, it is fair to say
that, as one would expect, the Navy is discussing all options to develop the
surface ship force for the future that will meet all identified requirements.”2
Statements at February and March House Hearings
At a February 27, 2008, hearing on Navy shipbuilding programs before the
Defense subcommittee of the House Appropriations Committee, the chairman of the
subcommittee, Representative John Murtha, stated that the subcommittee was
considering deferring procurement of the third DDG-1000 and using the funding
programmed for that ship to instead procure three other ships for the Navy in FY2009
2 Christopher P. Cavas, “DDG 1000 Destroyer Program Facing Major Cuts,”
DefenseNews.com, July 14, 2008.

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— a San Antonio (LPD-17) class amphibious ship and two Lewis and Clark (TAKE-
1) class dry cargo ships.3
At a March 6, 2008, hearing on the Department of the Navy’s proposed FY2009
budget before the House Armed Services Committee, certain committee members,
including Representative Gene Taylor, the chairman of the Seapower and
Expeditionary Forces subcommittee, stated that they were considering the option of
not procuring additional DDG-1000s and instead procuring additional Arleigh Burke
(DDG-51) class Aegis destroyers. These DDG-51s, it was stated at the hearing,
could act as a bridge to a design for the Navy’s planned CG(X) cruiser that is based
on an enlarged version of the DDG-51 hull and powered by one-half of the reactor
plant that the Navy has designed for its new Ford (CVN-78) class nuclear-powered
aircraft carriers.4
Reports of House and Senate Armed Services Committees
The House Armed Services Committee, in its report (H.Rept. 110-652 of May
16, 2008) on the FY2009 defense authorization bill (H.R. 5658), recommended
reducing the Navy’s request for FY2009 DDG-1000 procurement funding from
$2,503 million to zero, and increasing the Navy’s FY2009 request for DDG-1000
advance procurement funding from $51 million to $400 million. The report states
that the $400 million is to be used either for construction of DDG-1000s or for
restarting construction of Arleigh Burke (DDG-51) class destroyers, which were last
procured in FY2005.
The Senate Armed Services Committee, in its report (S.Rept. 110-335 of May
12, 2008) on the FY2009 defense authorization bill (S. 3001), recommended
approval of the Navy’s requests for FY2009 procurement and advance procurement
funding for the DDG-1000 program.
Background
DDG-1000 Program
Origin of Program. The program known today as the DDG-1000 program
was announced on November 1, 2001, when the Navy stated that it was replacing a
destroyer-development effort called the DD-21 program, which the Navy had
3 Source: Transcript of spoken remarks of Representative Murtha at the hearing. See also,
for example, Dan Taylor, “Murtha Mulls Cutting DDG-1000, Adding Two T-AKE Ships
and 10th LPD-17,” Inside the Navy, March 3, 2008, and Ashley Roque, “Murtha, Young
Press Navy on Shipbuilding Plan, Look to Alter 2009 Budget,” CongressNow, February 27,
2008.
4 Source: Transcript of spoken remarks of Representatives Gene Taylor and Jim Saxton at
the hearing.

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initiated in the mid-1990s, with a new Future Surface Combatant Program aimed at
developing and acquiring a family of three new classes of surface combatants:5
! a destroyer called DD(X) for the precision long-range strike and
naval gunfire mission,
! a cruiser called CG(X) for the air defense and ballistic missile
mission,6 and
! a smaller combatant called the Littoral Combat Ship (LCS) to
counter submarines, small surface attack craft (also called “swarm
boats”) and mines in heavily contested littoral (near-shore) areas.7
On April 7, 2006, the Navy announced that it had redesignated the DD(X)
program as the DDG-1000 program. The Navy also confirmed in that announcement
that the first ship in the class, DDG-1000, is to be named the Zumwalt, in honor of
Admiral Elmo R. Zumwalt, the Chief of Naval operations from 1970 to 1974. The
decision to name the first ship after Zumwalt was made by the Clinton
Administration in July 2000, when the program was still called the DD-21 program.8
Planned Surface Combatant Force Structure. The Navy in coming
years wants to achieve and maintain a fleet of 313 ships, including 88 cruisers and
destroyers and 55 LCSs.9 The 88 cruisers and destroyers are to include 7 DDG-
1000s, 19 CG(X) cruisers, and 62 older Arleigh Burke (DDG-51) class Aegis
destroyers.10
5 The DD-21 program was part of a Navy surface combatant acquisition effort begun in the
mid-1990s and called the SC-21 (Surface Combatant for the 21st Century) program. The SC-
21 program envisaged a new destroyer called DD-21 and a new cruiser called CG-21. When
the Navy announced the Future Surface Combatant Program in 2001, development work on
the DD-21 had been underway for several years, while the start of development work on the
CG-21 was still years in the future. The current DDG-1000 destroyer CG(X) cruiser
programs can be viewed as the descendants, respectively, of the DD-21 and CG-21. The
acronym SC-21 is still used in the Navy’s research and development account to designate
the line item (i.e., program element) that funds development work on both the DDG-1000
and CG(X).
6 For more on the CG(X) program, see CRS Report RL34179, Navy CG(X) Cruiser
Program: Background, Oversight Issues, and Options for Congress
, by Ronald O’Rourke.
7 For more on the LCS program, see CRS Report RL33741, Navy Littoral Combat Ship
(LCS) Program: Oversight Issues and Options for Congress
, by Ronald O’Rourke.
8 For more on Navy ship names, see CRS Report RS22478, Navy Ship Names: Background
For Congress
, by Ronald O’Rourke.
9 For more on the proposed 313-ship fleet, see CRS Report RL32665, Navy Force Structure
and Shipbuilding Plans: Background and Issues for Congress
, by Ronald O’Rourke.
10 The Navy’s 62 DDG-51s were procured between FY1985 and FY2005. The first entered
service in 1991. By the end of FY2006, 49 had entered service and the remaining 13 were
in various stages of construction, with the final ships scheduled to be delivered in 2010 or
2011. The Navy plans to give DDG-51s a mid-life modernization and operate them to age
(continued...)

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Planned DDG-1000 Procurement Through FY2013. Table 1 shows
actual and planned procurement of DDG-1000s in the FY2009-FY2013 Future Years
Defense Plan (FYDP). As shown in the table, the Navy plans to procure all 7 DDG-
1000s by the end of the FYDP. The Navy originally envisaged procuring a total of
16 to 24 DDG-1000s. Navy officials subsequently testified in February and March
2005 that they had a requirement for 8 to 12. The Navy’s 313-ship plan, announced
in February 2006, reduced the planned total to 7.
Table 1. Actual and Planned DDG-1000 Procurement
FY07
FY08
FY09
FY10
FY11
FY12
FY13
DDG-1000
2a
0a
1
1
1
1
1
Source: FY2009-FY2013 Future Years Defense Plan (FYDP).
a. Two DDG-1000s procured in FY2007 using split funding across FY2007 and FY2008.
Ship Missions and Design Features. The DDG-1000 program is
essentially a restructured continuation of the earlier DD-21 program, and the DDG-
1000 will resemble the DD-21 in terms of mission orientation and ship design: The
DDG-1000 is to be a multimission ship with an emphasis on land-attack operations,
reflecting a Navy desire to provide an updated replacement for the large-caliber naval
gunfire support capability that the Navy lost in 1990-1992, when it removed its four
reactivated Iowa-class battleships from service.
The DDG-1000 is to have a reduced-size crew (compared to the Navy’s current
destroyers and cruisers) of 142 sailors so as to permit reduced operating and support
(O&S) costs. The ship is to incorporate a significant number of new technologies,
including a wave-piercing, tumblehome hull design for reduced detectability, a
superstructure made partly of large sections of composite materials rather than steel
or aluminum, an integrated electric-drive propulsion system, a total-ship computing
system for moving information about the ship, automation technologies for the
reduced-sized crew, a dual-band radar, a new kind of vertical launch system (VLS)
for storing and firing missiles, and two copies of a 155mm gun called the Advanced
Gun System (AGS).
With a full load displacement of 14,987 tons, the DDG-1000 design is roughly
50% larger than the Navy’s current 9,500-ton Aegis cruisers and destroyers, and
larger than any Navy destroyer or cruiser since the nuclear-powered cruiser Long
Beach (CGN-9), which was procured in FY1957.
Program Funding. Table 2 shows DDG-1000 funding through FY2013.
The table excludes about $1.1 billion in research and development funding provided
for the predecessor DD-21 program from FY1995 through FY2001. Additional
10 (...continued)
35. (See CRS Report RS22595, Navy Aegis Cruiser and Destroyer Modernization:
Background and Issues for Congress
, by Ronald O’Rourke.) The DDG-51s, which displace
about 9,200 tons, are equipped with the Aegis combat system and are therefore referred to
as Aegis destroyers.

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funding for research and development and for outfitting and post-delivery costs is
programmed for the DDG-1000 program after FY2013. The table also excludes $513
million in post-FY2013 outfitting and post-delivery costs.
Table 2. DDG-1000 Program Funding, FY2002-FY2013
(millions of then-year dollars, rounded to nearest million; totals may not add due
to rounding)
FY02
Total
thru FY 07 FY08 FY09 FY10
FY11
FY12
FY13
thru
FY06
FY13
Research, Development, Test and Evaluation, Navy (RDTEN) account
DDG-1000a
4549
756
493
449
521
565
326
174
7832
Shipbuilding and Conversion, Navy (SCN) account
DDG-1000 and
1010
2557
2757
0
0
0
0
0
6325b
DDG-1001
DD/NREb
994
893
0
0
0
0
0
0
1887b
Construction
16
1664
2757
0
0
0
0
0
4437b
DDG-1002
0
0
150 2503
0
0
0
0
2653
DDG-1003
0
0
0
51
2663
0
0
0
2714
DDG-1004
0
0
0
0
51
2377
0
0
2428
DDG-1005
0
0
0
0
0
50
2569
0
2619
DDG-1006
0
0
0
0
0
0
50
2347
2397
Outfitting/post-
0
0
0
0
16
61
87
132
295
delivery costsc
Subtotal SCN
1010
2557
2907 2554
2730
2488
2706
2479
19430
TOTAL
5559
3313
3399 3003
3250
3053
3032
2653
27262
Source: Navy data provided to CRS on May 8, 2008, and July 7, 2007.
a. DDG-1000 portion of Program Element (PE) 0604300N, DDG-1000 Total Ship System
Engineering (previously called SC-21 Total Ship System Engineering). PE0604300N
also includes funding the CG(X) cruiser program. Figures shown do not include
$1,111.4 million in RDTEN funding provided for DD-21/DD(X) program in FY1995-
FY2001. Additional RDTEN funding for the DDG-1000 program required after
FY2013. The Navy states that figure for RDTEN for FY2002-FY2006 does not
include congressional adds to PE0604300N during that period; budget-justification
documents show about $41 million in such additional funding in FY2006 and much
smaller amounts in FY2002-FY2005.
b. DD/NRE is detailed design/non-recurring engineering costs for the class. In Navy
shipbuilding programs, DD/NRE costs for a class of ships are traditionally included
in the procurement cost of the lead ship(s) in the class.
c. $513 million in additional outfitting/post-delivery costs programmed after FY2013.
As can be seen in the table, the Navy is requesting $449 million in FY2009
research and development funding for the DDG-1000 program. This $449 million
is included within $679 million that the Navy is requesting in FY2009 for a line item
(i.e., program element, or PE) in the Navy’s research and development account called

CRS-9
“DDG-1000 Total Ship System Engineering” (PE0604300N, the 100th line item in
the account). This line item was previously called “SC-21 Total Ship System
Engineering.” Although this line item is named for the DDG-1000 program, it
includes research and development funding for both the DDG-1000 and CG(X)
programs. The other $230 million requested in this line item is for the CG(X)
program.11
Based on the figures in the table, when $1.1 billion in FY1995-FY2001 DD-
21/DD(X) research and development costs and $513 million in post-FY2013
outfitting and post-delivery costs are included, the Navy estimates the total
acquisition (i.e., development plus procurement) cost of the seven-ship DDG-1000
program at about $28.9 billion in then-year dollars, or an average of about $4.1
billion per ship, not including additional DDG-1000 research and development costs
after FY2013.
Several major technologies developed for the DDG-1000 are to be used on the
CG(X) cruiser and other future Navy ships, so at least some portion of the DDG-1000
program’s research and development costs might be viewed as not truly specific to
the DDG-1000 program. Based on the figures in the table, when the DDG-1000
program’s research and development costs are excluded, the Navy estimates the total
procurement cost of the DDG-1000 program (including $513 million in post-FY2013
outfitting and post-delivery costs) at about $19.9 billion in then-year dollars, or an
average of about $2.8 billion per ship.
Acquisition Strategy.
Navy Management. Since September 30, 2005, the Navy has managed the
DDG-1000 program through a series of separate contracts with major DDG-1000
contractors, including Northrop Grumman Shipbuilding (NGSB), General Dynamics
Bath Iron Works (GD/BIW), Raytheon, and BAE Systems (the maker of the AGS).
Under this arrangement, the Navy is acting as the overall system integrator for the
program.
Earlier Proposal for Winner-Take-All Acquisition Strategy. Under a
DDG-1000 acquisition strategy approved by the Under Secretary of Defense for
Acquisition, Technology, and Logistics (USD AT&L) on February 24, 2004, the first
DDG-1000 was to have been built by NGSB, the second ship was to have been built
by GD/BIW, and contracts for building the first six were to have been equally divided
between NGSB and GD/BIW.
In February 2005, Navy officials announced that they would seek approval from
USD AT&L to instead hold a one-time, winner-take-all competition between NGSB
and GD/BIW to build all DDG-1000s. On April 20, 2005, the USD AT&L issued
a decision memorandum deferring this proposal, stating in part, “at this time, I
11 As discussed in a previous footnote, SC-21 means surface combatant for the 21st Century
and refers to the Navy’s pre-November 2001 SC-21 program to develop a destroyer called
the DD-21 (now called the DDG-1000) and an eventual cruiser called the CG-21 (now
called CG(X)).

CRS-10
consider it premature to change the shipbuilder portion of the acquisition strategy
which I approved on February 24, 2004.”
Several Members of Congress also expressed opposition to Navy’s proposal for
a winner-take-all competition. Congress included a provision (Section 1019) in the
Emergency Supplemental Appropriations Act for 2005 (H.R. 1268/P.L. 109-13 of
May 11, 2005) prohibiting a winner-take-all competition. The provision effectively
required the participation of at least one additional shipyard in the program but did
not specify the share of the program that is to go to the additional shipyard.
On May 25, 2005, the Navy announced that, in light of Section 1019 of P.L.
109-13, it wanted to shift to a “dual-lead-ship” acquisition strategy, under which two
DDG-1000s would be procured in FY2007, with one to be designed and built by
NGSB and the other by GD/BIW.
Section 125 of the FY2006 defense authorization act (H.R. 1815/P.L. 109-163)
again prohibited the Navy from using a winner-take-all acquisition strategy for
procuring its next-generation destroyer. The provision again effectively requires the
participation of at least one additional shipyard in the program but does not specify
the share of the program that is to go to the additional shipyard.
Milestone B Approval for Dual-Lead-Ship Strategy. On November 23,
2005, the USD AT&L, granted Milestone B approval for the DDG-1000, permitting
the program to enter the System Development and Demonstration (SDD) phase. As
part of this decision, the USD AT&L approved the Navy’s proposed dual-lead-ship
acquisition strategy and a low rate initial production quantity of eight ships (one more
than the Navy currently plans to procure).
Construction Sequence for Two Lead Ships. Until July 2007, it was
expected that NGSB would be the final-assembly yard for the first DDG-1000 and
that GD/BIW would be the final-assembly yard for the second. On July 17 and 18,
2007, it was reported that the Navy was considering the option of instead assigning
the first ship to GD/BIW and the second to NGSB. The potential switch in
construction sequence reportedly was being considered by the Navy in part because
the Navy believed it could provide some additional help in maintaining GD/BIW’s
work force as its DDG-51-related construction work winds down, and because it
could also provide some additional time for NGSB to recover from Katrina-related
damage.12 On September 25, 2007, the Navy announced that it had decided to build
the first DDG-1000 at GD/BIW, and the second at NGSB.13 The difference in the
two ships’ construction schedules (about one year) is driven in large part by the
12 Christopher P. Cavas, “First DDG 1000 Could Shift To Bath,” Defense News, July 17,
2007; Geoff Fein, “Navy Exploring Workload Options For DDG-1000,” Defense Daily, July
18, 2007.
13 Geoff Fein, “Bath Iron Works To Take Delivery of First Set of DDG-1000 Equipment,”
Defense Daily, September 26, 2007; Christopher P. Cavas, “Bath To Build First DDG
1000,” DefenseNews.com, October 1, 2007; and Chris Johnson, “Navy Changes Equipment
Delivery For First Two DDG-1000 Destroyers,” Inside the Navy, October 1, 2007.

CRS-11
production capacities of vendors making certain components for the ships — some
of these vendors can make only one ship-set worth of components at a time.
Contract Modification Awards for Two Lead Ships. On February 14,
2008, the Navy awarded contract modifications to GD/BIW and NGSB for the
construction of the two lead ships. The awards were modifications to existing
contracts that the Navy has with GD/BIW and NGSB for detailed design and
construction of the two lead ships. Under the modified contracts, the line item for
the construction of the dual lead ships is treated as a cost plus incentive fee (CPIF)
item.
Acquisition Strategy for Third and Subsequent Ships.14 Under an
acquisition strategy approved by the Department of Defense (DOD) acquisition
executive and documented in an updated Acquisition Strategy Report (ASR) of
February 13, 2008, the Navy intends to conduct a single competition between
GD/BIW and NGSB for the contracts to build the five remaining ships in the
program (i.e., ships three through seven). The winner of the competition would build
three ships (the third, fifth, and seventh ships in the program, to be procured in
FY2009, FY2011, and FY2013, respectively), while the other firm would build two
ships (the fourth and sixth ships in the program, to be procured in FY2010 and
FY2012, respectively).
Under this strategy, each firm would build a minimum of two ships, and the two
firms would in effect compete for the right to build the remaining fifth ship. In light
of the shared production arrangement for the DDG-1000 program (see discussion
below), the two firms more specifically would be competing for the right to build
certain portions of that fifth ship, and to perform the final-assembly work on that ship
— work that would amount to about 50% of the total shipyard labor hours needed
to build that fifth ship. The two firms could also be viewed as competing for the
timing of their respective second ships, as the winner’s second ship would be the ship
to be procured in FY2009, while the other firm’s second ship would be the ship to
be procured in FY2010.
The Navy intends to structure the contract with the winning firm as a fixed-price
incentive fee (FPIF) contract to build the ship to be procured in FY2009, with priced
options for building the ships to be procured in FY2011 and FY2013. The Navy
intends to structure the contract with the other firm as an FPIF contract to build the
ship to be procured in FY2010, with a priced option to build the ship to be procured
in FY2012. If one or more of the third and subsequent ships are not procured in the
years in which the Navy currently plans procure them, the options would not be
exercised and the Navy might conduct a new competition to determine who would
build the follow-on ships in the program.
Shared Production Arrangement. NGSB and GD/BIW have agreed on
a shared-production arrangement for building DDG-1000s. Under this arrangement,
certain parts of each ship will be built by NGSB, certain other parts of each ship will
14 The information presented in this section is based on an April 10, 2008, Navy briefing to
CRS and CBO on the DDG-1000 program.

CRS-12
be built by GD/BIW, and the remaining parts of each ship would be built by the yard
that does final-assembly work on that ship. Each firm’s repeating portion of the ship
would amount to about 25% of the labor hours for the ship; the yard that does the
final-assembly work on the ship would also perform the remaining 50% or so of the
labor hours needed to build the ship. The arrangement can be viewed as somewhat
analogous to the joint-production arrangement for Virginia-class submarines that was
proposed by industry and the Navy, and then approved by Congress in Section 121
of the FY1998 defense authorization act (H.R. 1119/P.L. 105-85 of November 18,
1997).15
Procurement Cost Cap. Section 123 of the FY2006 defense authorization
act (H.R. 1815/P.L. 109-163 of January 6, 2006), limits the procurement cost of the
fifth DDG-1000 to $2.3 billion, plus adjustments for inflation and other factors.
Surface Combatant Industrial Base
All cruisers, destroyers, and frigates procured since FY1985 have been built at
two shipyards — General Dynamics’ Bath Iron Works (GD/BIW) in Bath, ME, and
the Ingalls shipyard in Pascagoula, MS, that forms part of NGSB.16 Both yards have
long histories of building larger surface combatants. Construction of Navy surface
combatants in recent years has accounted for virtually all of GD/BIW’s ship-
construction work and for a significant share of Ingalls’ ship-construction work.
Navy surface combatants are overhauled, repaired, and modernized at GD/BIW,
NGSB, other private-sector U.S. shipyards, and government-operated naval shipyards
(NSYs).
Lockheed Martin and Raytheon are generally considered the two leading Navy
surface ship radar makers and combat system integrators. Boeing is another system
integrator and maker of Navy surface ship weapons and equipment.
The surface combatant industrial and technological base also includes hundreds
of additional firms that supply materials and components. The financial health of the
supplier firms has been a matter of concern in recent years, particularly since some
of them are the sole sources for what they make for Navy surface combatants.
Oversight Issues for Congress
Accuracy of Navy Cost Estimate
One potential oversight issue for Congress concerns the accuracy of the Navy’s
cost estimate for the program.
15 For more on the Virginia-class joint-production arrangement, see CRS Report RL32418,
Navy Attack Submarine Force-Level Goal and Procurement Rate: Background and Issues
for Congress
, by Ronald O’Rourke.
16 NGSB also includes the Avondale shipyard near New Orleans, Newport News
Shipbuilding of Newport News, VA, and a fourth facility at Gulfport, MS.

CRS-13
CBO June 2008 Report. The Congressional Budget Office (CBO) believes
that the Navy is significantly underestimating DDG-1000 procurement costs. CBO
reported in June 2008 that it believes the first two DDG-1000s will each cost about
56% more than the Navy estimates, that the other five ships in the program would
each cost about 64% more than the Navy estimates, and that the complete seven-ship
class consequently would cost about 60% more than the Navy estimates. CBO
reported that:
The [Navy’s FY]2009 budget suggests that the Navy expects the first two [DDG-
1000s] to cost $3.2 billion each [in constant FY2009 dollars] and the next five
to cost an average of $2.2 billion each [in constant FY2009 dollars] — a cost
increase of about $200 million per ship [in constant FY2009 dollars] for the last
five ships compared with the cost in the Navy’s 2008 budget. CBO, by contrast,
estimates that the first two DDG-1000s would cost $5.0 billion apiece [in
constant FY2009 dollars] and that the next five would cost an average of $3.6
billion each [in constant FY2009 dollars].
The Navy’s estimate for the two lead-ship DDG-1000s prices the ship at
about $250 million (in 2009 dollars) per thousand tons of lightship displacement
(the weight of the ship minus its crew, fuel, ammunition, and stores). In
comparison, the lead ship of the DDG-51 class destroyer cost about $390 million
per thousand tons [in constant FY2009 dollars], and the lead ship of the
Ticonderoga class cruiser cost more than $400 million per thousand tons [in
constant FY2009 dollars].... CBO used the DDG-51 lead-ship cost as its basis for
estimating the cost of the lead ship of the DDG-1000 class, adjusting for the size
of the ship.
The Navy has asserted that the basis for CBO’s estimate may not be valid
because the DDG-51 had a number of problems in the early stages of its
construction that should not be expected to occur during the construction of the
first DDG-1000s. In particular, the design of the lead DDG-51 was disrupted and
delayed because a new design tool being used at the time was incomplete and not
well understood. It had to be abandoned and the design restarted using more
traditional methods. The design of the lead DDG-51 was thus about 20 percent
complete when construction began. In comparison, according to the Navy, the
design of the DDG-1000 is progressing far more smoothly; the Navy expects to
have the design 85 percent complete when construction begins this summer. In
addition, the DDG-51 is a smaller, more densely built ship; therefore, the Navy
believes that on a ton-for-ton basis, it has been more difficult to build than the
DDG-1000 class is going to be.
Although the Navy may not encounter the same problems constructing the
lead DDG-1000s that it did when constructing the lead DDG-51, it is CBO’s
view that the service is likely to encounter other problems that will increase the
costs of the DDG-1000 and delay its construction. As Navy officials have stated,
lead ships are often very difficult to build, and many problems typically occur
during construction. Problems with the first littoral combat ships (for which costs
doubled) and with the lead ship of the LPD-17 class amphibious transport dock
(for which costs increased by 80 percent and construction time more than
doubled) illustrate the difficulties the Navy has encountered recently in
constructing lead ships. Both the LCS and the LPD-17 are much less complex
technologically than the DDG-1000 will be. And Navy officials have stated that
the Virginia class submarine program was at about the same point in its design
that the DDG-1000 will be when construction of those new submarines began.

CRS-14
Nevertheless, the cost of the first two ships of the Virginia class exceeded their
budget by an average of 17 percent. Moreover, the DDG-1000 program is
incorporating 10 major new technologies into the lead ship of the class compared
with the technologies used in the previous-generation DDG-51 destroyer. Those
technologies include electric drive and a distributed power system, a tumblehome
hull (one in which the sides of the ship slope outward to increase stealthiness),
an advanced gun system, new radars, and composite materials and stealthy
coatings for the deckhouse. In the past, the Navy typically introduced three or
four major new technologies into a new class of surface combatant.
Comparing the Navy’s estimate for two additional DDG-51s and the Navy’s
estimate for the seventh DDG-1000 to be purchased in 2013 illustrates the risk
for cost growth in the latter program. Last year, the Navy stated that if the
Congress authorized and bought two new DDG-51s in 2008 — ships that would
have the benefit of substantial efficiencies and lessons learned because of the 62
similar ships built previously — the cost would be between $3.1 billion and $3.2
billion, or about $1.6 billion each in 2009 dollars. At the same time, in its fiscal
year 2009 budget submission to the Congress, the Navy stated that the cost to
build the seventh DDG-1000 in 2013 would be about $2.4 billion in 2013 dollars.
Deflating the cost of the seventh DDG-1000, using the inflation index for
shipbuilding that the Navy provided to CBO, brings the Navy’s estimate for that
ship to about $1.9 billion in 2009 dollars. The lightship displacement of the
DDG-1000 is about 5,000 tons (or more than 50 percent) greater than the
lightship displacement of the DDG-51s under construction today. In effect, the
Navy’s estimates imply that those 5,000 extra tons, as well as the 10 new
technologies being incorporated into the DDG-1000 class, will add only 15
percent, or about $300 million, to the ship’s cost.17
CBO also stated:
Recent developments in the DDG-1000 program could change CBO’s
estimate. Each of the two shipbuilders plans to build about 25 percent of the
seven individual ships. The remaining 50 percent of each ship would be built by
the home shipyard, wherein one builder would construct four destroyers and the
other, three. This “teaming” arrangement, somewhat similar to the teaming
arrangement used to build Virginia class attack submarines, would in effect allow
half of the content of the seventh ship to benefit from experience developed
during the construction of the six previous ships; the other half of the ship’s
content would benefit from lessons learned during the construction of only three
ships. In addition, the Navy has placed both of the lead ships under contract, with
fixed-price contracts for the materials that will be used to construct the ships.
CBO did not have sufficient data or time to evaluate the effect that these and
other developments could have on its estimate but will do so in future analyses
and updates of this report.18
CBO also stated:
17 Congressional Budget Office, Resource Implications of the Navy’s Fiscal Year 2009
Shipbuilding Plan June 9, 2008
, pp. 20-23.
18 Ibid, p. 23 (footnote 16).

CRS-15
The relatively simple design of the LCSs and the substantial cost increases
that have occurred in the program suggest that the Navy may also have trouble
meeting its cost targets for the larger, much more complex surface combatants
in its shipbuilding plan, such as the DDG-1000 and the CG(X).19
GAO July 2007 Testimony. Although the Navy publicly stands by its DDG-
1000 cost estimates, the Government Accountability Office (GAO) testified in July
2007 that the Navy had assigned a confidence level of about 45% to its own
estimates, meaning that the Navy itself believed there was about a 55% chance that
DDG-1000s will exceed the Navy’s estimates. GAO testified that:
One way to improve the cost-estimating process is to present a confidence
level for each estimate, based on risk and uncertainty analyses. By conducting
an uncertainty analysis that measures the probability of cost growth, the Navy
can identify a level of confidence for its estimates and determine whether
program costs are realistically achievable. Navy cost analysts told us that they
used quantitative risk analyses to test the validity of cost estimates of CVN 78
and DDG 1000. We believe that the Navy and the Department of Defense (DOD)
should take this a step further — requiring a high confidence level threshold
when making program commitments and budget requests. The Defense
Acquisition Performance Assessment Panel recommended an 80 percent
confidence level, meaning that a program has an 80 percent chance of achieving
its estimated costs. Whether this is the right level warrants thoughtful discussion,
but it is worth noting that analyses for CVN 78 and DDG 1000 were well below
an 80 percent confidence level (in the case of DDG 1000 at around 45 percent)
— increasing the likelihood that costs will grow above budget.20
GAO’s July 2007 testimony was presented while Congress was considering the
Navy’s proposed FY2008 budget. In its proposed FY2009 budget, the Navy has
increased its estimate of DDG-1000 procurement costs by about 6.9%.21 In light of
this increase, it is possible that the Navy’s confidence level has increased from 45%
to some higher figure.
October 2007 Report on CAIG Estimate. On October 1, 2007, it was
reported that the Cost Analysis Improvement Group (CAIG), a cost-estimating office
within the Office of the Secretary of Defense, had estimated that the first two DDG-
19 Ibid, p. 27.
20 Government Accountability Office, Defense Acquisitions[:] Realistic Business Cases
Needed to Execute Navy Shipbuilding Programs, Statement of Paul L. Francis, Director,
Acquisition and Sourcing Management Team, Testimony Before the Subcommittee on
Seapower and Expeditionary Forces, Committee on Armed Services, House of
Representatives
, July 24, 2007 (GAO-07-943T), pp. 17-18.
21 Under the FY2008 shipbuilding plan, the Navy estimated the combined end cost of the
seven DDG-1000s at $18,185 million in then-year dollars; under the FY2009 shipbuilding
plan, the Navy estimates their combined end cost at $19,136 million in then-year dollars.
There is no change in the years in which the ships are to be procured.

CRS-16
1000s would together cost about $7.2 billion to procure, or about 14% more than the
Navy’s combined estimate for the two ships in 2007.22
March 2008 CRS Testimony on Potential Impact of Cost Growth.
Using CBO’s cost estimates for the DDG-1000 program, CRS testified in March
2008 on the question of the potential implications for the Navy’s shipbuilding
program of cost growth in the DDG-1000 program. CRS stated that:
Under CBO’s estimates, the first two DDG-1000s, instead of having a
combined cost of about $6.3 billion in then-year dollars, as the Navy now
estimates, might have a combined cost of roughly $10.2 billion in then-year
dollars, which would be an increase of roughly $3.9 billion in then-year dollars.
The remaining five ships in the class, instead of having a combined procurement
cost of about $12.8 billion in then-year dollars, as the Navy now estimates, might
have a combined procurement cost of roughly $20.7 billion in then-year dollars,
which would be an increase of roughly $7.9 billion in then-year dollars. Under
CBO’s estimates, the combined cost growth for all seven ships would be roughly
$11.8 billion in then-year dollars, which is a figure roughly comparable to the
total amount of funding in Shipbuilding and Conversion, Navy (SCN)
appropriation account in certain recent years.23
Program Affordability and Cost Effectiveness
Another potential oversight issue for Congress concerns the affordability and
cost effectiveness of the DDG-1000 program.
Testimony at July 19-20, 2005, Hearing. The affordability and cost-
effectiveness of the DDG-1000 program was explored extensively at a two-part
hearing on the DDG-1000 program held on July 19 and 20, 2005, before the
Projection Forces subcommittee of the House Armed Services Committee. At the
end of the July 19 portion of the hearing, DOD and Navy witnesses were asked by
the subcommittee chairman, Representative Roscoe Bartlett, to provide the
subcommittee with their own individual views on the procurement cost figures at
which the lead DDG-1000 and a follow-on DDG-1000 (defined as the fifth ship)
would become unaffordable. At the beginning of the July 20 portion of the hearing,
Representative Bartlett stated that the figures provided by the witnesses ranged from
$4 billion to $4.5 billion for the lead ship and $2.5 billion to $2.9 billion for the fifth
ship. The Navy’s current cost estimates for the first and fifth DDG-1000s are below
these figures; CBO’s current cost estimates for the first and fifth DDG-1000s are
substantially above these figures.
22 “Sticker Price,” Defense Daily, October 1, 2007. See also Christopher P. Cavas, “DDG
1000 Contract Talks Hit Rough Seas,” DefenseNews.com, October 15, 2007, which refers
to “a recent non-Navy estimate” of $7.2 billion for the two ships.
23 Statement of Ronald O’Rourke, Specialist in Naval Affairs, Congressional Research
Service, Before the House Armed Services Committee, Subcommittee on Seapower and
Expeditionary Forces Hearing on The Navy Shipbuilding Budget Request, March 14, 2008,
p. 9.

CRS-17
Comparison with DDG-51. The debate over the affordability and cost-
effectiveness of the DDG-1000 program has often focused on comparing the costs
and capabilities of the DDG-1000 and DDG-51 designs. In making such
comparisons, a potential key question for Congress is, What are the military
capability gaps that need to be filled through procurement of destroyers over the next
several years, and which general procurement approach for filling those gaps —
procurement of DDG-1000s, procurement of DDG-51s, or some other approach —
would be the best in terms of affordability and cost effectiveness?
The DDG-1000 and DDG-51 are both multimission destroyers, but they have
somewhat different mission emphases. The DDG-1000 design features a stronger
emphasis on land-attack operations and operations in littoral waters. The DDG-51
design is more oriented toward blue-water operations. Consistent with its larger size,
higher procurement cost, and greater use of new technologies, the Navy believes the
DDG-1000 is more capable than the DDG-51 design in several respects. For detailed
comparisons of the capabilities of the DDG-1000 and DDG-51 designs, see
Appendix B.
The Navy testified in April 2008 before the Seapower subcommittee of the
Senate Armed Services Committee that a single additional DDG-51 might cost about
$2.1 billion to procure in FY2009, and that two additional DDG-51s might require
about $3.3 billion to procure in FY2009.24
A May 7, 2008, letter from Admiral Gary Roughead, the Chief of Naval
Operations (CNO), to Senator Edward Kennedy that was obtained by a defense trade
publication and posted on its website provided information on the comparative costs
and capabilities of the DDG-1000 and DDG-51. The letter stated that a single
additional DDG-51 might cost about $2.2 billion to procure in FY2009, and that two
additional DDG-51s might require about $3.5 billion to procure in FY2009, if built
at competing production yards. The letter stated that the average procurement cost
of subsequent DDG-51s would be about $1.8 billion each, and that the estimated
annual operating and support cost of a DDG-51 would be $41.2 million, while that
of a DDG-1000 would be $37.3 million, of $3.9 million less.25 For the full text of
the letter, see Appendix B.
On June 3, 2008, John Young, the Under Secretary of Defense for Acquisition,
Technology, and Logistics, in testimony to the Senate Armed Services Committee,
questioned the accuracy of the cost figures in the May 7 letter, stating, among other
things, that he believed the annual operating and support cost of the DDG-1000
would be about $10 million less than that of a DDG-51, and that the procurement
cost figures in the letter relied on certain assumptions that might not prove accurate.
24 Source: Spoken testimony of Navy officials at April 8, 2008, hearing before the Seapower
subcommittee of the Senate Armed Services Committee.
25 Source: Letter dated May 7, 2008, from Admiral G. Roughead to the Honorable Edward
M. Kennedy, posted on the Internet at InsideDefense.com (subscription required) on May
30, 2008. For the full text of the letters, see Appendix B. See also Thomas Duffy, “Navy
Says DDG-100, DDG-51 Annual Operating Costs Are Rated Even,” Inside the Navy, June
2, 2008.

CRS-18
Young’s testimony was viewed as defending the DDG-1000 more strongly than did
the CNO’s May 7, 2008, letter.26
A July 2, 2008, letter from John Young to Representative Gene Taylor that was
obtained by a defense trade publication and posted on its website provides additional
comments regarding the DDG-1000 and DDG-51, as well as information about the
readiness of the DDG-1000 design to enter production. The letter can be viewed as
supporting continued DDG-1000 procurement and cautioning against the alternative
of restarting DDG-51 procurement. For the full text of the letter, see Appendix B.
Arguments of DDG-1000 Supporters. The Navy and others who argue
that the DDG-1000 is affordable and more cost effective than the DDG-51 make the
following points, among others:
! Although the DDG-1000 design is more expensive to procure than
the DDG-51 design, it is much more capable than the DDG-51
design in many respects, making it more cost-effective than the
DDG-51 design.
! The DDG-1000 design has more growth potential — more capacity
for accepting upgrades and improvements over the ship’s operating
life — than the DDG-51 design, which gives the DDG-1000 design
a higher chance of remaining mission-effective over a 35-year
operating life than a new-built DDG-51.
! The DDG-1000 design is optimized for operations in littoral (near-
shore) waters, while the DDG-51 design is optimized for blue-water
operations farther from shore. The Navy has ample blue-water
warfighting capability, but needs to improve its littoral warfighting
capability. The Navy does not require additional DDG-51s.
! Within the area of littoral-warfare capabilities, a key Navy need is
to improve the fleet’s naval surface fire support (NSFS) capabilities.
The DDG-1000, with its two AGSs, was designed with this need in
mind and has much more NSFS capability than the DDG-1000
design.
! A DDG-1000, with a crew of 142 (about half the size of a DDG-51’s
crew), will have only about one-half the life-cycle crew-related costs
of a DDG-51. Crew-related costs are a major component of a ship’s
total life-cycle operating and support (O&S) costs. The lower life-
cycle crew-related costs of the DDG-1000 design compared to those
of the DDG-51 design enhance the DDG-1000 design’s cost-
effectiveness relative to the DDG-51 design.
26 See, for example, Emelie Rutherford, “Young Claims Inaccuracies, Assumptions In Navy
Destroyer Cost Comparison,” Defense Daily, June 5, 2008; and Dale Eisman, “Warning:
Delay On Ship Will Run Up Navy’s Costs,” Norfolk Virginian-Pilot,” June 4, 2008: D1.

CRS-19
! Building additional DDG-1000s would keep open the production
line for the DDG-1000 hull design, which could form the basis for
the design of the Navy’s planned CG(X) cruiser. Past Navy
testimony has indicated a Navy preference for basing the CG(X), if
possible, on the DDG-1000 hull design, so as to reduce CG(X) hull
design costs and take maximum advantage of DDG-1000 production
learning curve benefits.
! Building additional DDG-51s would involve reopening the DDG-51
production line. Some elements of that line could take a long time
to deliver their initial products, which could stretch out the
production schedule for the initial DDG-51, increasing its cost.
Production costs for DDG-51s could also be higher than some
estimate due to the break in the DDG-51 production learning curve
since FY2005, and the higher percentage of so-called “green” (i.e.,
inexperienced) labor in DDG-51 production facilities compared to
percentages in FY2005 and previous years..
Arguments of DDG-1000 Skeptics or DDG-51 Supporters. Those who
are skeptical of the affordability and cost effectiveness of the DDG-1000, or who
believe that procurement of DDG-51s would be more cost effective than procurement
of DDG-1000s, might argue the following:
! The DDG-1000’s capability improvements, though significant, are
not worth the ship’s cost, particularly if the ship’s cost turns out to
be closer to CBO’s estimates than to the Navy’s estimates. Actual
DDG-51 production costs are fairly well understood as a result of
many prior years of production, while actual DDG-1000 production
costs are unknown. As a consequence, procuring DDG-51s would
pose less risk in terms of potential cost overruns than procuring
DDG-1000s.
! Many of the DDG-1000’s capability improvements, though
significant, might not be needed to address critical military
capability gaps. The DDG-1000’s capabilities reflect insufficient
discipline on the Navy’s part in establishing mission requirements
for the DDG-1000. (For a discussion of DDG-1000 mission
requirements, see Appendix A.) Although the Navy states that it
does not require additional DDG-51s, the Navy would find good
uses for them. The Navy might discover in coming years that it
needs additional Aegis-equipped ships to perform the Navy’s
emerging mission of ballistic missile defense.
! If the DDG-1000’s most-needed contribution to military capabilities
is the improved NSFS capability provided by the ship’s two AGSs,
then the DDG-1000 design represents a very expensive way to add
this capability to the fleet. AGSs can be added to the fleet less
expensively by building a modified version of the LPD-17
amphibious ship hull equipped with two AGSs. (For a discussion of
potential lower-cost ship designs, see Appendix C.)

CRS-20
! Crew-related costs are only one component of total O&S costs. The
DDG-1000 design’s total life-cycle O&S costs might be closer to the
DDG-51 design’s total life-cycle O&S costs than might be suggested
by a comparison of crew-related costs only. In addition, future
DDG-51s can be built to a modified design that could reduce their
crew size from roughly 300 to something closer to 200, reducing the
differential in crew-related costs between the DDG-1000 and DDG-
51 designs.
! The two DDG-1000s already procured are enough to mature and
demonstrate the DDG-1000 technologies that the Navy wants to use
on the CG(X) cruiser and other future Navy surface ships. Procuring
additional DDG-51s would reopen the production line for the DDG-
51 hull design, which might serve as the basis for the CG(X) design.
Technical Risk
A third potential oversight issue for Congress concerns technical risk in the
DDG-1000 program, which can affect the Navy’s ability to build DDG-1000s on
schedule and within budgeted costs. Over the past few years, GAO has reported on
the technical risks involved in developing the several significant new technologies
that are to be incorporated into the DDG-1000. The Navy over the years has worked
to retire these risks. GAO reported in March 2008 that:
Three of 12 DDG 1000 critical technologies are fully mature, having been
demonstrated in a sea environment. While 7 other technologies are approaching
full maturity, 5 of them will not demonstrate full maturity until after installation
on the ship. Two technologies remain at lower levels of maturity — the volume
search radar and total ship computing environment. Land-based testing of a
volume search radar prototype is expected to begin in May 2008 — a delay of
over 12 months since last year’s assessment. Software development for the total
ship computing environment has been replanned, shifting functionality to later
software blocks. The Navy plans on completing 85 percent of the ship’s detail
design prior to the start of construction....
The volume search and multifunction radars constitute the dual band radar
system. While the multifunction radar has been tested at sea, the volume search
radar continues to experience delays. Problems in developing the prototype and
constructing the test facility have delayed land-based testing of the volume
search radar by over a year. In order to support the ship construction schedule,
the Navy has begun initial testing at an alternate test site. Because of issues with
a critical circuit technology, the volume search radar will not demonstrate full
power output until at least 2010 — after production of the dual band radar is well
under way. Problems or delays discovered during testing will likely affect radar
production and installation.
The total ship computing environment includes hardware and six blocks of
software code. Current software development is focused on the fourth block. The
Navy has reduced its software development efforts in order to accommodate
available funding. As a consequence, some functionality has been deferred to
blocks five and six. The Navy believes that cost and schedule parameters will
still be achieved by leveraging non-development items and existing software

CRS-21
code. However, full maturity will not occur until after the start of ship
construction.
Of the seven technologies approaching full maturity, the Navy expects to
demonstrate full maturity of the integrated deckhouse and peripheral vertical
launch system by the start of ship construction in July 2008. Production of a
large-scale deckhouse test unit is under way and final validation of the vertical
launching system will occur in spring 2008. Practical limitations prevent the
Navy from fully demonstrating all critical technologies at sea prior to ship
installation. Testing of other technologies continues through ship construction
start.
Due to scheduling issues for the lead ships, the Navy did not have time to
fully test the integrated power system prior to shipyard delivery and instead
requested funds in fiscal year 2008 to procure an additional unit. The Navy will
conduct integrated power system testing in 2010 using this unit at a land-based
test site. Considerable software development remains and land-based testing will
mark the first integrated testing between the power generation and distribution
system and the control system. If problems are discovered during testing,
construction plans and costs could be at risk because the power systems needed
for the first two ships will already have been delivered to the shipyards.
The Navy continues to test prototypes of the ship’s hull form to
demonstrate stability in extreme sea conditions at higher speeds. According to
Navy officials, existing computer simulation tools over-predicted the ship’s
tendency to capsize. The Navy is now relying on testing of scale models in tanks
and on the Chesapeake Bay, and is updating its computer simulation tool.
Ongoing testing is aimed at developing guidance for operating the ship safely
under different sea conditions.27
Lockheed states that GAO’s discussion of the volume search radar is based on
outdated information, and that the development of the volume search radar is
proceeding well.28
As individual DDG-1000 technologies mature, technical risk in the DDG-1000
program will shift more to the follow-on task of system integration — of getting all
ship’s technologies to work together smoothly in a single platform. In past defense
acquisition programs, system integration has often proven to be at least as
challenging as the task of developing individual new technologies.
As mentioned in the Background Section, the Navy since September 30, 2005,
has been acting as the system integrator for the DDG-1000 program. Problems in the
execution of the Coast Guard Deepwater program29 and the Littoral Combat Ship
(LCS) program led to a reexamination in Congress in 2007 of the concept of the
27 Government Accountability Office, Defense Acquisitions[:] Assessments of Selected
Weapon Programs
, GAO-08-467SP, March 2008, pp. 69-70.
28 Source: Lockheed perspective provided to CRS on July 3, 2008.
29 For additional discussion of the Deepwater program, see CRS Report RL33753, Coast
Guard Deepwater Program: Background, Oversight Issues, and Options for Congress
, by
Ronald O’Rourke.

CRS-22
private-sector lead system integrator (LSI), and to a desire among some Members to
shift certain acquisition functions, including system design and integration, from the
private sector, to where they had migrated starting in the 1990s, back to the federal
government. The Navy’s decision in 2005 to begin acting as the system integrator
for the DDG-1000 program will make the program an early test of DOD’s ability to
once again perform the system-integration function following the downsizing of
DOD’s technical and acquisition workforce that occurred when acquisition functions
were earlier transferred to the private sector. The DDG-1000 program, in addition
to being an early test of DOD’s abilities in this area, may represent a fairly
challenging test, given the number of significant new technologies that are to be
integrated into the ship.
In discussing the system-integration task, Navy officials argue that the DDG-
1000 program office has the authority and resources to access technical capacity
throughout the Navy, including expertise at Navy research, development, and testing
centers in various parts of the country. Navy officials also argue that the engineering
development models (EDMs) that it has used to develop key technologies for the
DDG-1000 have been designed not only to develop the ability of each technology to
work as a stand-alone item, but also to integrate well with other systems when
installed on the ship. Navy officials also argue that since its beginning in the 1980s,
the Navy has been responsible for managing a large number of contractors who make
various components of the DDG-51 (including the Aegis combat system) that are
then provided by the Navy to the shipbuilders as government-furnished equipment
(GFE). By comparison, Navy officials argue, the task of overseeing the integration
of the DDG-100 combat system will require the Navy to work with only two
contractors (Raytheon and BAE).30
Industrial Base
A fourth potential oversight issue for Congress concerns the potential industrial-
base implications of the DDG-1000 program. The Navy’s 30-year shipbuilding plan
calls for procuring an average of about 1.5 DDG-1000s/CG(X)s over the next 17
years. If affordability considerations limit DDG-1000/CG(X) procurement to one
ship per year in FY2011 and subsequent years, the average workload over time for
the cruiser-destroyer industrial base in those years might thus be reduced by roughly
one-third from levels that would be achieved under the Navy’s 30-year plan.
The Navy informed CRS on March 11, 2008, that a DDG-1000 would require,
by Navy estimates, about 2.5 times as much shipyard labor to build as would be
required to build a DDG-51.31 On April 10, 2008, the Navy clarified that this ratio
was based on the number of labor hours that the Navy estimates will be needed to
build the first two DDG-1000s, and that subsequent DDG-1000s would require
smaller amounts of shipyard labor, reducing the ratio for subsequent ships to
30 Source: Navy briefing to CRS and CBO on April 10, 2008.
31 Source: Navy Office of Legislative Affairs telephone call to CRS on March 11, 2008.

CRS-23
something less than 2.5 to 1.32 (The DDG-51 design, in contrast, is already well
down its learning curve and would not decline by a substantial additional amount
through additional production.) Assuming a rate of learning in the DDG-1000
production process that might be typical for a complex combatant ship, and taking
into account the shared production arrangement for the DDG-1000, a seventh DDG-
1000 might require roughly 1.7 to 1.9 times as much shipyard labor to build as a
DDG-51, and a class of seven DDG-1000s might require roughly 2 to 2.2 times as
much shipyard labor to build as a group of seven DDG-51s.33
The Navy has stated that procuring additional DDG-51s would pose some
production-line uncertainties regarding DDG-51 sub-vendors.34
Options for Congress
List of Potential Options
Potential options for Congress for the DDG-1000 program, some of which could
be combined, include but are not limited to the following:
! approve the seven-ship DDG-1000 program as proposed by the
Navy;
! use a block-buy contract for DDG-1000s procured during the five-
year period FY2009-FY2013;
! establish terms and conditions for the acquisition strategy to be used
for the third and subsequent ships in the program;
! defer procurement of the third and/or subsequent DDG-1000s and
use the funding programmed for that ship/those ships to instead
procure other Navy ships;
! to help accelerate CG(X) procurement, procure three CG(X)s in
FY2011, FY2012, and FY2013 in lieu of the fifth, sixth, and seventh
DDG-1000s;
32 Source: Navy briefing to CRS and CBO on April 10, 2008.
33 Source: CRS calculation based on a CRS assumption of:
— a smooth learning curve of 85% to 90% for the DDG-1000 program;
— a unified learning curve for the portions of every DDG-1000 that are to be built by only
one single firm; and
— a split learning curve for the portion of each DDG-1000 that is to be built by the yard
performing the final-assembly work on the ship.
For a discussion of shipbuilding learning curves, see CRS Report 96-785 F, Navy Major
Shipbuilding Programs and Shipbuilders: Issues and Options for Congress
, by Ronald
O’Rourke, pp. 95-110. [out of print and available directly from the author]
34 Source: Testimony of Navy officials before Seapower subcommittee of Senate Armed
Services Committee on April 8, 2008.

CRS-24
! as an annual affordability measure, limit DDG-1000/CG(X)
procurement to a combined total of no more than one ship per year;
! as total-program affordability measure, limit DDG-1000/CG(X)
procurement to a combined total of 11 or 12 ships (one for each of
11 or 12 planned carrier strike groups (CSGs));
! procure no more than two DDG-1000s for use as technology
demonstrators for future surface combatants (and also as operational
warships), and supplement the industrial base with other work; and
! start design work now on a lower-cost naval gunfire support ship
and/or a lower-cost cruiser-destroyer, and start procuring these ships,
rather than additional DDG-1000s or CG(X)s, when these new
designs are ready for procurement.
With regard to the final option above, for additional discussion of potential
lower-cost ships, see Appendix C.
Deferring DDG-1000s and Procuring Other Ships Instead
As mentioned in the “Introduction” section, on July 14, 2008, the defense trade
publication Inside the Navy reported that: “In a dramatic, behind-the-scenes
about-face, the Navy is rescinding support for its Zumwalt-class DDG-1000 destroyer
program, seeking to persuade Pentagon leaders to limit the program to two ships and
resume construction of Arleigh Burke-class DDG-51 destroyers.... Industry sources
say the Navy is interested in completing the first two DDG-1000s and then buying
11 new DDG-51s, which would mean reopening production lines for the Arleigh
Burkes.”
As also mentioned in the “Introduction” section, at a February 27, 2008, hearing
on Navy shipbuilding programs before the Defense subcommittee of the House
Appropriations Committee, the chairman of the subcommittee, Representative John
Murtha, stated that the subcommittee is considering deferring procurement of the
third DDG-1000 and using the funding programmed for that ship to instead procure
three other ships for the Navy in FY2009 — a San Antonio (LPD-17) class
amphibious ship and two Lewis and Clark (TAKE-1) class dry cargo ships.
As also mentioned in the “Introduction” section, at a March 6, 2008, hearing on
the Department of the Navy’s proposed FY2009 budget before the House Armed
Services Committee, certain committee members, including Representative Gene
Taylor, the chairman of the Seapower and Expeditionary Forces subcommittee, stated
that they are considering the option of not procuring additional DDG-1000s and
instead procuring additional Arleigh Burke (DDG-51) class Aegis destroyers. These
DDG-51s, it was stated at the hearing, could act as a bridge to a design for the Navy’s
planned CG(X) cruiser that is based on an enlarged version of the DDG-51 hull and
powered by one-half of the reactor plant that the Navy has designed for its new Ford
(CVN-78) class nuclear-powered aircraft carriers.
With regard to the option of procuring additional DDG-51s instead of additional
DDG-1000s, two variations might be envisaged. One would use the funding

CRS-25
programmed for the third through seventh DDG-1000s to procure additional DDG-
51s. The other would use the funding programmed for the third and fourth DDG-
1000s to procure additional DDG-51s, and the funding for the fifth through seventh
DDG-1000s to procure CG(X)s currently planned for procurement in later years, so
as to accelerate the introduction of CG(X)s into the fleet.
As shown in Table 2, a total of $12,661 million is programmed in FY2009-
FY2013 for the procurement of the third through seventh DDG-1000s.35 As
mentioned earlier, the Navy has testified in 2008 that a single additional DDG-51
might cost about $2.1 billion to procure, and that two additional DDG-51s might
require about $3.3 billion to procure.36 Based on the two-ship DDG-51 procurement
cost figure, a total of $12,661 million might procure about 7.7 DDG-51s.
A total of $5,217 million is programmed in FY2009 and FY2010 for the
procurement of the third and fourth DDG-1000s.37 Again based on the Navy’s cost
estimate for procuring two DDG-51s, a total of $5,217 million might procure about
3.2 DDG-51s.
As mentioned earlier in the section on DDG-1000 affordability and cost-
effectiveness, and discussed in more detail in Appendix B, the DDG-1000 and
DDG-51 are both multimission destroyers, but they have somewhat different mission
emphases. The DDG-1000 design features a stronger emphasis on land-attack
operations and operations in littoral waters. The DDG-51 design is more oriented
toward blue-water operations. Consistent with its larger size, higher procurement
cost, and greater use of new technologies, the Navy believes the DDG-1000 is more
capable than the DDG-51 design in several respects. Under the option discussed
here, the greater individual capability of the DDG-1000 design in certain respects
would be offset to some degree by the greater quantity of DDG-51s.
Procuring three DDG-51s might provide 69% to 75% as much shipyard labor
as procuring two DDG-1000s, and procuring eight DDG-51s might provide 78% to
86% as much shipyard labor as procuring five DDG-1000s.38
35 This figure excludes outfitting and post-delivery costs and $150 million in FY2008
advance procurement funding for the third DDG-1000.
36 Source: Spoken testimony of Navy officials at April 8, 2008, hearing before the Seapower
subcommittee of the Senate Armed Services Committee.
37 This figure excludes outfitting and post-delivery costs, $150 million in FY2008 advance
procurement funding for the third DDG-1000, and $51 million in FY2010 advance
procurement funding programmed for the fifth DDG-1000.
38 Source: CRS calculation based on Navy statement to CRS of March 11, 2008, as further
clarified by Navy statement to CRS on April 10, 2008, that each of the first two DDG-1000s
would require about 2.5 times as much shipyard labor to build as would be required to build
a DDG-51, and further based a CRS assumption of:
— a smooth learning curve of 85% to 90% for the DDG-1000 program;
— a unified learning curve for the portions of every DDG-1000 that are to be built by only
one single firm; and
— a split learning curve for the portion of each DDG-1000 that is to be built by the yard
(continued...)

CRS-26
Procuring DDG-51s instead of DDG-1000s could increase work for supplier
firms that provide materials and components for DDG-51s but not DDG-1000s, and
reduce work for supplier firms that provide materials and components for DDG-
1000s but not DDG-51s. The Navy states that procuring additional DDG-51s would
pose some production-line uncertainties regarding DDG-51 sub-vendors.39
For additional arguments relating to the issue of procuring DDG-51s rather than
DDG-1000s, see the earlier section on DDG-1000 affordability and cost-
effectiveness.
The DDG-51s procured under this option could be built to a modified design
with improved warfighting capabilities. The option of building DDG-51s to a
modified design has been discussed in CRS reports since 1994.40 Building DDG-51s
to a modified design could affect the ships’ procurement cost and increase the
technology and cost risks associated with their procurement.
FY2009 Legislative Activity
Table 3 summarizes congressional action on the Navy’s FY2009 request for
research and development, procurement, and advance procurement funding for the
DDG-1000 program.
38 (...continued)
performing the final-assembly work on the ship.
For a discussion of shipbuilding learning curves, see CRS Report 96-785 F, Navy Major
Shipbuilding Programs and Shipbuilders: Issues and Options for Congress
, by Ronald
O’Rourke, pp. 95-110. [out of print and available directly from the author]
39 Source: Testimony of Navy officials before Seapower subcommittee of Senate Armed
Services Committee on April 8, 2008.
40 A 1994 CRS report presented the option of building DDG-51s to a lengthened
configuration with a total of 128 VLS cells, as opposed to the 96 on the current Flight IIA
DDG-51 design. (See CRS Report 94-343 F, Navy DDG-51 Destroyer Procurement Rate:
Issues and Options for Congress
, by Ronald O’Rourke, pp. CRS-27 to CRS-28. [out of
print; available directly from the author]) In more recent years, CRS has presented the
option of building a ship based on a lengthened version of the DDG-51 hull, with a
displacement of about 11,000 tons, as one possibility for a potential lower-cost cruiser-
destroyer design. See, for example, Appendix C.

CRS-27
Table 3. Congressional Action on FY2009 Funding Request
(figures in millions of then-year dollars, rounded to nearest million)
Authorization
Appropriation
Request
HASC
SASC
Conf.
HAC
SAC
Conf.
Research and
449
449
449
developmenta
Procurementb
Procurement
2503
0
2503
Advance
51
400c
51
procurement
Total
2554
400c
2554
procurement
Source: FY2009 Navy budget submission and committee reports on the FY2009 defense
authorization and appropriation bills.
Notes: HASC is House Armed Services Committee; SASC is Senate Armed Services
Committee, HAC is House Appropriations Committee; SAC is Senate Appropriations
Committee; Conf. is conference report.
a. Research, Development, Test, and Evaluation, Navy (RDT&EN) account.
b. Shipbuilding and Conversion, Navy (SCN) account.
c. To be used “for the construction of DDG 51 class destroyers or DDG 1000 class
destroyers.”
FY2009 Defense Authorization Bill (H.R. 5658/S. 3001)
House. The House Armed Services Committee, in its report (H.Rept. 110-652
of May 16, 2008) on H.R. 5658, recommended reducing the Navy’s request for
FY2009 DDG-1000 procurement funding from $2,503 million to zero, and increasing
the Navy’s FY2009 request for DDG-1000 advance procurement funding from $51
million to $400 million. (Page 79, lines 010 and 011.) The $400 million in advance
procurement funding would be used “for the construction of DDG 51 class destroyers
or DDG 1000 class destroyers.” (Page 83) The report recommended approval of the
DDG-1000 portion of the Navy’s request for FY2009 research and funding request
for the DDG-1000 and CG(X) programs. (Page 186, line 97.) With regard to
procurement and advance procurement funding, the report states that:
The committee authorizes a reallocation of funding in the Shipbuilding and
Conversion, Navy account and the National Defense Sealift Fund. The committee
recommends: full funding for the 10th ship of the LPD 17 class; an increase in
advance procurement funding for the Virginia class submarine program,
necessary for the procurement of 2 ships in fiscal year 2010; advance
procurement for the final 2 ships of the T-AKE class; and advance procurement
for the construction of DDG 51 class destroyers or DDG 1000 class destroyers.
The committee notes that due to the overall delay in the DDG 1000 destroyer
program, the Navy would be unable to execute the full funding request in fiscal
year 2009 for the third ship of the planned seven ship class. Additionally, the
committee is concerned with potential significant cost overruns in the DDG 1000
program and considers it prudent to pause the program until technological
challenges are completely understood.

CRS-28
The committee authorizes these programs without prejudice to any specific
program. The committee also understands the Navy is strongly considering
re-starting the DDG 51 class destroyer upgraded with an improved radar system
to fill an urgent need in ballistic missile defense. The committee would only
support that decision if the industrial base for surface combatant construction is
not affected. The committee expects the Secretary of Defense, subject to the
availability of appropriations, to enter into advance procurement and advance
construction contracts for the construction of surface combatants balanced
between the two current surface combatant shipyards, taking into account
workforce challenges still in effect on the Gulf Coast due to the lingering
economic effects of Hurricane Katrina. (Page 83)
See also the additional views of Representative Niki Tsongas on pages 654-655
of the report.
Senate. The Senate Armed Services Committee, in its report (S.Rept. 110-335
of May 12, 2008) on S. 3001, recommended approval of the Navy’s requests for
FY2009 procurement and advance procurement funding for the DDG-1000 program.
(Page 58, lines 010 and 011.) The report recommended approval of the DDG-1000
portion of the Navy’s request for FY2009 research and funding request for the DDG-
1000 and CG(X) programs. (Page 181, line 97.)

CRS-29
Appendix A. DDG-1000 Mission Requirements
The DDG-1000’s capabilities reflect an Operational Requirements Document
(ORD) for the DDG-1000 that was approved by the Joint Staff of DOD in February
2004. Key performance parameters included in this document include having two
AGSs that can each fire 10 rounds per minute, for a total of 20 rounds per minute.41
DOD stated in 2005 that
During the restructuring of the DD-21 program into the DD(X) program, the
Navy re-evaluated each DD-21 Key Performance Parameter (KPP) to determine
the potential for minimizing the size of the ship and ultimately the cost. The
Navy made many adjustments and the resulting DD(X) KPPs represent the
Navy’s minimum requirements. No other known alternative meets all of the
DD(X) KPPs and provide the sustained, precision, long-range naval surface fire
support that the United States Marine Corps requires.42
Some observers speculate that the Navy and DOD established requirements for
the DDG-1000 without a full appreciation of how large and expensive a ship design
the requirements would generate. Naval analyst Norman Friedman, the author of
numerous books on U.S. warship designs, stated in a 2004 book on U.S. destroyer
designs that
In past [Navy ship design] practice, the naval policymakers in OpNav [the
Office of the Chief of Naval Operations] would write a draft set of [ship]
characteristics.... The Preliminary Design branch of BuShips [the Bureau of
Ships] or NAVSEA [the Naval Sea Systems Command] would develop sketch
designs to meet the requirements. Often the OpNav policymakers would find the
results outrageous — for example, exorbitantly expensive. Such results would
force them to decide just how important their various requests had been.
Eventually Preliminary Design would produce something OpNav found
acceptable, but that might not actually be built....
In contrast to past practice, no preliminary design [for the DDG-1000] was drawn
up to test the cost of various requirements. Each requirement was justified in
operational terms, (e.g., a level of stealth that would reduce detectability by some
percentage); but those sponsoring the ship had no way of knowing the impact
that a particular combination of such requirements would have. Normally
NAVSEA would have created a series of sketch designs for exactly that
purpose.43
An August 2005 trade press article suggested that growth in DD-21/DDG-1000
requirements (and cost) over time may have been related to the disestablishment of
a Navy ship-design board called the Ship Characteristics Improvement Board (SCIB)
41 Statement by The Honorable Kenneth J. Krieg, Under Secretary of Defense (Acquisition,
Technology and Logistics), Before the Subcommittee on Projection Forces, House Armed
Services Committee, United States House of Representatives, July, 19, 2005, p. 2.
42 Ibid, pp. 6-7.
43 Norman Friedman, U.S. Destroyers, An Illustrated Design History, Revised Edition.
Annapolis, Naval Institute Press, 2004, pp. 437 and 447-448. Punctuation as in the original.

CRS-30
— an entity that Admiral Michael Mullen, who became the Chief of Naval
Operations on July 22, 2005, reestablished under a new name:
Adm. Michael Mullen, the chief of naval operations, has directed the Navy
to re-establish a high-level panel to closely monitor and control the requirements
and configurations of new ships in a bid to rein in the skyrocketing cost of new
vessel procurement.
Adm. Robert Willard, vice chief of naval operations, is leading the effort
as part of a larger undertaking to draw up alternative options for the Navy’s
current shipbuilding program....
In essence, sources said, Mullen is looking to reconstitute the Ship
Characteristics Improvement Board, which eventually became inactive in 2002.
For more than 100 years, the Navy has maintained a high-level group of officials
to advise service leaders on ship design and configuration. This group,
established in 1900 as the General Board has gone through many name changes,
including the Ship Characteristics and Improvement Board in the early 1980s
and, until 2002, the Ship Characteristics and Improvement Panel.
Navy officials say that the panel’s oversight began to wane in the late
1990s, just as the DD-21 program — originally envisioned as a $750 million
replacement for Spruance-class destroyers — took off, before becoming
officially inactive in 2002. Requirements during this time were added to the new
destroyer program, some of which raised eyebrows in the Navy, such as the need
for a flag officer quarters. No other ship in that class has accommodations for
an admiral. Still, the DDG-1000 has come to be regarded as a technology carrier
for future surface ships and the price tag has ballooned to $3 billion a copy.
Mullen’s goal, spelled out in a July 25 memo to Willard and provided to
InsideDefense.com, is to put in place a “process that adequately defines warship
requirements and manages changes to those requirements (e.g. Ship
Characteristics Improvement Board) in a disciplined manner, with cost and
configuration control as the paramount considerations.”...
A recent RAND study conducted at the request of Mullen’s predecessor,
retired Adm. Vern Clark, concluded that a key cause for climbing ship costs is
the number of requirements tacked on to a program, according to a consultant
familiar with the findings of the study, which has not been made public.
“So, what I think Mullen has in the back of his head is, ‘I’ve got to get the
requirements process for ships back under control or we’re always going to end
up, every time we talk about a new destroyer, with a $3 billion ship,’” said a
former senior Navy official.
This senior official, who was in a key Pentagon position as the DD-21
program commenced, said that without a panel overseeing the ship’s
configuration and true requirements the new destroyer program became weighed
down with capabilities that carried a high price tag.
“In hindsight, we realized that we had put requirements on the ship that no
one had really vetted for its cost impact on the ship. For example, it was to

CRS-31
operate acoustically silent and risk free in minefields,” said the official. “If the
SCIB had existed, this probably would not have happened.”44
A March 2007 report from the Center for Strategic and Budgetary Assessments
(CSBA) made a similar point:
For nearly a century, the Navy’s SCIB — a group of high-ranking DoN
[Department of the Navy] officials — worked to balance desired warship
warfighting requirements against their impact on a ship’s final design and
production costs. The primary reason why the Navy lost cost control over the
DD-21/DD(X)/DDG-1000 was that just as the ship entered its design definition
phase, the power of the Navy’s SCIB was waning, replaced by a Joint
requirements definition process with no fiscal checks and balances.45
Some observers, such as Norman Friedman, have raised questions about the
Navy’s decision to use a tumblehome (i.e., inward-sloping) hull for the DDG-1000.
A 2006 magazine article by Friedman, for example,
! raised questions about the implications of a tumblehome hull for the
ship’s ability to deal with underwater damage;46
! asked whether the Navy knew at the outset of the DDG-1000 design
process how much a decision to incorporate a tumblehome hull (and
other survivability features) would increase the size of the ship; and
! questioned whether the reduced visibility of the tumblehome hull to
certain types of radars — the central reason for using a tumblehome
hull — will be negated by its visibility to high-frequency (HF)
surface wave radars that are now for sale on the international market.
The article, which refers to the DDG-1000 by the previous designation DD(X),
stated:
In the case of the DD(X), the overriding requirement [in determining the
hull design] was to minimise radar cross section — stealth. Much of the hull
design was dictated by the attempt to reflect radar pulses away from the radar
emitting them, so that radar returns would be minimised. By now the main
technique is well known: slope all flat surfaces and eliminate the corner reflector
created by the juncture of the hull and water....
44 Jason Sherman, “Mullen To Bring Back Panel To Control Ship Configuration, Cost,”
Inside the Navy, August 8, 2005.
45 Robert Work, Know When To Hold ‘Em, Know When To Fold ‘Em: Thinking About Navy
Plans For The Future Surface Battle Line
, Washington, Center For Strategic and Budgetary
Assessments, 2007. p. 6. (CSBA Backgrounder, March 7, 2007.)
46 Other observers have also expressed concerns about the stability of the DDG-1000’s
tumblehome hull in certain see conditions. For a discussion, see Christopher P. Cavas, “Is
New U.S. Destroyer Unstable?,” DefenseNews.com, April 2, 2007.

CRS-32
If the ship could be stabilized sufficiently [against rolling from side to side], then
she would never (or almost never) present any vertical surfaces [to a radar]. In
the case of DD(X), stabilization is apparently achieved using ballast tanks. Such
tanks in turn demand internal volume deep in the ship. Overall, stealth demands
that as much as possible of the overall volume of the ship be buried in her hull,
where the shape of the ship can minimise radar returns. That is why,
paradoxically, a carefully-designed stealthy ship will be considerably larger —
for more internal volume — than a less stealthy and more conventional
equivalent. In the case of DD(X), there were also demands for improved
survivability. The demand for stealth implied that anti-ship missiles were the
most important envisaged threat. They hit above water, so an important
survivability feature would be to put as much of the ship’s vitals as possible
below water — which meant greater demands for underwater volume....
Once the tumblehome hull had been chosen, [the ship’s designers] were
apparently also constrained to slope the bow back [creating a surface-piercing or
ram bow] instead of, as is usual, forward....
There were numerous reasons why [past] naval architects abandoned
tumblehome hulls and ram bows. Tumblehome reduces a ship’s ability to deal
with underwater damage. When a conventional flared (outward-sloping) hull
sinks deeper in the water, its waterplane area [the cross-section of the ship where
it intersects the plane of the water] increases. It becomes somewhat more stable,
and it takes more water to sink it deeper into the water. Because the waterplane
area of a tumblehome ship decreases as it draws more water, such a ship is easier
to sink deeper. Tumblehome also apparently makes a ship less stable, and hence
less capable of resisting extreme weather conditions. The larger the ship, the
more extreme the weather has to be to make that critical. Critics of DD(X) have
concentrated on the danger; defenders have concentrated on how extreme the
critical weather condition would be.
In the end, whether the DD(X) hull form is attractive depends on an
evaluation of anti-radar stealth as a design driver. About a decade ago, the
DD(X) design concept was sold on the basis of a lengthy (and, incidentally,
unclassified) analysis, the gist of which was that a heavily-armed surface
combatant could play a decisive role in a Korean scenario...
The key analytic point... was that it would be very important for the ship to
come reasonably close to enemy shores unobserved. That in turn meant anti-
radar stealth. However, it soon came to mean a particular kind of anti-radar
performance, against centimetric-wave radars [radars with wavelengths on the
order of centimeters] of the sort used by patrol aircraft (the ship would fire [its
weapons] from beyond the usual horizons of shore-based radars). As it happens,
anti-ship missiles use much the same kinds of radars as patrolling aircraft, so it
could be argued that the same anti-radar techniques would be effective in the
end-game in which missiles would approach the ship....
Without access to files of the time, it is impossible to say whether those
approving the [DDG-1000] project realised that its stealth and survivability
characteristics would produce a 14,000 to 17,000 ton destroyer. About the same
time that DD(X) characteristics (requirements) were being approved, the decision
was taken at [the] Defense Department (not Navy) level that there would be no
internal feasibility design. In the past, the feasibility stage had the very useful
role of showing those setting requirements what their implications would be. At

CRS-33
the very least, the Navy’s senior leadership would have been given warning that
they would have to justify a drastic jump in destroyer size when they wanted to
build DD(X). That jump might well have been considered justified, but on the
other hand the leadership might also have asked whether a somewhat less
dramatic approach would have been acceptable.
About a decade after the requirements were chosen, with DD(X) well
advanced, the situation with regard to stealth may be changing. Shaping is
relevant only at relatively short [radar] wavelengths. For about a quarter-century,
there has been talk of HF surface wave radars, which operate at wavelengths of
about 10 to 200 meters — i.e. at wavelengths the size of a ship. Canada currently
operates this type of radar, made by Raytheon, for surveillance of the Grand
Banks; another is being tested in the Caribbean. Australia has bought this kind
of radar to fill gaps in over-the-horizon radar coverage. Turkey is buying such
radars for sale for some years. In 2005 it was reported unofficially that China
had bought [a] Russian HF surface wave radar the previous year.
It seems almost certain that HF surface wave radar can defeat any kind of
stealth shaping designed primarily to deal with shorter-wave[length] radars.
Moreover, [HF surface wave] radars have an inherent maximum range (due to the
way they operate) of about 180nm.... At long range [the radar’s beam] is not
nearly accurate enough to aim a missile. However, we can easily imagine a
netted system which would use the long-range [HF surface wave] radar to define
a small box within which the target ship would be. A missile with GPS [Global
Positioning System] guidance could be flown to that box, ordered to search it....
If the argument given here is realistic, then the considerable sacrifices inherent
in the DD(X) design no longer seem nearly as attractive. It can still be argued
that a design like the DD(X) is attractive well out to sea, beyond the reach of
coastal radars. In that case, however, there may be other signatures which can
be exploited. For example, ships proceeding at any speed create massive
wakes.... it is clear that the wake produces a radar return very visible from an
airplane or, probably, from a space-based radar....
In the end, then, how much is stealth worth? As a way of avoiding
detection altogether, probably less than imagined. That leaves the rather
important end-game, the hope being that decoys of some sort greatly exceed
actual ship radar cross-section. That is probably not a foolish hope, but it does
not require the sort of treatment reflected in [the] DD(X).
Now, it may be that the Untied States typically faces countries which have
not had the sense to buy anti-stealth radars (though we would hate to bet on that).
In that case, DD(X) may well be effectively invisible to them. So will a lot of
less thoroughly stealthy ships.47
Potential oversight questions for Congress include the following:
! SCIB and DDG-1000 requirements. Are the DDG-1000’s
requirements partly a result of inadequate discipline, following the
47 Norman Friedman, “The New Shape of Ships,” Naval Forces, No. II, 2006: 56-58, 60, 62-
63. Italics as in the original. Friedman makes somewhat similar comments in chapter 17
(pages 431-450) of U.S. Destroyers, An Illustrated Design History, Revised Edition, op cit.

CRS-34
disestablishment of the SCIB, in the Navy’s process for setting
requirements for new ships? If the SCIB had remained in existence
during the DD-21/DDG-1000 design process, which of the DDG-
1000’s current requirements would have been reduced or
eliminated?
! Tumblehome hull. How much did the decision to use a
tumblehome hull (and other survivability features) increase the size
and cost of the DDG-1000? In the mid-1990s, when design work
began on the ship now known as DDG-1000, how well did the Navy
understand the relationship between using a tumblehome hull and
ship size and cost? What effect does the tumblehome hull have on
the DDG-1000’s ability to deal with underwater damage? To what
degree will HF surface wave radars negate the stealth characteristics
of the DDG-1000 design?
! AGSs. Since the DDG-1000 is the only ship planned to carry AGSs,
and since AGSs are viewed by the Marine Corps as necessary to
meet Marine Corps requirements for naval surface fire support
capability, should the AGSs be considered the most-critical payload
element on the DDG-1000, and certain other payload elements,
though desirable, be considered as possibly less critical by
comparison?

CRS-35
Appendix B. Comparisons of DDG-1000 and
DDG-51
This appendix provides information on the capabilities and costs of the DDG-
1000 and DDG-51 designs, as presented by the Navy and DOD on five occasions:
! in July 19, 2005, Navy testimony before the Projection Forces
subcommittee of the House Armed Services Committee;
! at a June 10, 2005, Navy briefing to CRS;
! at an April 10, 2008, Navy briefing to CRS and CBO; and
! in a May 7, 2008, Navy letter to Senator Kennedy; and
! in a July 2, 2008, DOD letter to Representative Taylor.
Overview
The DDG-1000 and DDG-51 are both multimission destroyers, but they have
somewhat different mission emphases. The DDG-1000 design features a stronger
emphasis on land-attack operations and operations in littoral waters. The DDG-51
design is more oriented toward blue-water operations.
Consistent with its larger size, higher procurement cost, and greater use of new
technologies, the DDG-1000, the Navy believes, is more capable than the DDG-51
design in several respects. The Navy states that it designed the DDG-1000 for “full-
spectrum littoral dominance” and believes the DDG-1000 would be considerably
more capable than the DDG-51 in littoral operations. The Navy believes that because
of its reduced signatures, defensive systems, number of gun shells in its magazine,
and ability to resupply gun shells while underway, the DDG-1000 would have
considerably more capability than the DDG-51 to enter defended littoral waters and
conduct sustained operations there. The Navy believes that because of its guns,
aviation capabilities, special operations forces (SOF) support capabilities, and small-
boat capabilities, the DDG-1000 would be able to perform more littoral missions than
the DDG-51. The Navy believes that because of its radars and C4I/networking
capabilities, replacing a DDG-51 with a DDG-1000 in a carrier strike group would
increase the strike group’s anti-air warfare (AAW) capabilities by about 20%. The
Navy believes that because of differences in their sonar capabilities, the DDG-51 has
more blue-water anti-submarine warfare (ASW) capability than the DDG-1000.
July 19, 2005, Navy Testimony
At the July 19 portion of a July 19-20, 2005, hearing before the Projection
Forces subcommittee of the House Armed Services Committee, Navy officials
testified that, compared to the DDG-51 design, the DDG-1000 design’s capability
improvements include, among other things,

CRS-36
! a threefold improvement in capability against anti-ship cruise
missiles, including significantly better radar performance in
situations involving near-land radar clutter;
! a 10-fold improvement in overall battle force defense capability, in
part because of a 5-fold improvement in networking bandwidth
capacity;
! 15% more capability to defend against group attacks by enemy
surface craft (i.e., “swarm boats”);
! a 50-fold improvement (i.e., reduction) in radar cross-section, which
dramatically enhances survivability and reduces by half the total
number of missiles that need to be fired in an intercept engagement;
! a 10-fold increase in operating area against mines in shallow-water
regions;
! three times as much naval surface fire support capability, including
an ability to answer 90% of Marine Corps calls for fire within five
minutes, permitting the ship to meet stated Marine Corps firepower
requirements — a capability otherwise unavailable in the surface
fleet — giving the ship a capability roughly equivalent to one-half
of an artillery battalion, and permitting a 65% reduction in Marine
Corps artillery;
! a ship design that allows underway replenishment of gun shells,
creating the equivalent of an almost-infinite ammunition magazine
and permitting nearly continuous fire support;
! almost 10 times as much electrical capacity available for ship
equipment, giving the ship an ability to support future
electromagnetic rail guns and high-energy laser weapons; and
! features such as an automated fire-suppression system, peripheral
vertical launch system, and integrated fight-through-damage power
system that significantly increase ship survivability.48
48 Source: Points taken from Statement of Admiral Vern Clark, U.S. Navy, Chief of Naval
Operations, Before The House Armed Services Committee Projection Forces Subcommittee,
July 19th, 2005, and Statement of The Honorable John J. Young, Jr., Assistant Secretary of
the Navy (Research, Development and Acquisition), and RADM Charles S. Hamilton, II,
Program Executive Officer For Ships, Before the Projection Forces Subcommittee of the
House Armed Services Committee on DD(X) Shipbuilding Program, July 19, 2005.

CRS-37
June 10, 2005, Navy Briefing to CRS
The following comparison of DDG-1000 and DDG-51 capabilities is based on
information provided by the Navy to CRS at a briefing on June 1, 2005. The
information has been updated in some places to account for changes since 2005.
Growth Margin. The DDG-51 and DDG-1000 designs each have about a 10%
growth margin. For the roughly 9,000-ton DDG-51, this equates to about 900 tons
of growth margin, while for the 14,987-ton DDG-1000, this equates to about 1,400
tons of growth margin.
Ship Mobility. The two designs are roughly equivalent in terms of maximum
sustained speed, cruising endurance, and seakeeping (i.e., stability in rough seas).
The DDG-1000’s draft (28 feet) is somewhat less than the DDG-51’s (31 feet).
Other things held equal, this might give the DDG-1000 an ability to operate in (or be
berthed at) places where the water depth is sufficient for the DDG-1000 but not for
the DDG-51. The DDG-1000’s length (600 feet) is greater than the DDG-51’s (505
feet). Other things held equal, this might give the DDG-51 an ability to be berthed
in spaces that are long enough for the DDG-51 but not for the DDG-1000.
Electrical Power for Weapons and Systems. The DDG-51 has 7.5
megawatts (MW) of electrical power for its weapon systems, while the DDG-1000
design, with its integrated electric-drive system, can provide up to 78 MW for its
weapons and power systems by diverting power from propulsion to weapons and
systems.
Signatures and Detectability. The DDG-1000 has a smaller radar cross-
section and lower infrared, acoustic, and magnetic signatures than the DDG-51. The
two designs are roughly equivalent in terms of the detectability of their radar and
other electromagnetic emissions. The DDG-1000’s reduced signatures, DDG-1000
supporters, will make the DDG-1000 harder to detect, localize, classify, and target,
giving the DDG-1000 a significant advantage in engagements against enemy forces.
Survivability and Damage Control. The Navy states that the DDG-1000
would be able to keep fighting after an attack like the one that disabled the USS Cole
(DDG-67) on October 12, 2000.
The two designs are roughly equivalent in terms of degree of
compartmentalization and ship stability when flooded. The DDG-1000’s vertical
launch system (VLS) is more heavily armored than the DDG-51’s. The DDG’s fire-
suppression system is automated only in the engine room and magazine, while the
DDG-1000’s system is automated throughout the ship, making it safer and more
effective. The DDG-51’s flood-control system is not automated, while the DDG-
1000’s is, which the Navy believes will make it more effective. The DDG-1000’s
electrical power distribution system is an “integrated fight-through” system, meaning
that it is designed to automatically isolate damaged areas and reroute electrical power
around them. All critical DDG-1000 systems are dual-fed, meaning that if power
from one source is cut off, it can be routed through a second source. The DDG-51’s
electrical power distribution system lacks these features.

CRS-38
C4I/Networking Bandwidth. The C4I49 and networking systems on the
DDG-1000 would have five times as much bandwidth as those on the DDG-51. The
C4I/networking capability of the DDG-1000 is equivalent to that on the LHD-8
amphibious assault ship. In addition to improved warfighting capability, this
increased bandwidth would provide sailors aboard the DDG-1000 a better ability to
“reach back” to information sources ashore when conducting at-sea maintenance of
shipboard equipment, potentially increasing the availability rates of shipboard
equipment.
Flag-Level Command Facilities. The DDG-1000 has facilities for
embarking and supporting a flag-level officer and his staff, so that they could use the
ship as platform for commanding a group of ships. The DDG-51 does not have such
facilities.
Anti-Air Warfare/Ballistic Missile Defense (AAW/BMD). The radars on
the two ships are roughly equivalent in terms of dB gain (sensitivity) and target
resolution. The firm track range of the DDG-1000’s dual-band radar — the range at
which it can maintain firm tracks on targets — is 25% greater for most target types
than the firm track range of the DDG-51’s SPY-1 radar. The DDG-1000’s AAW
combat system would be able to maintain about 10 times as many tracks as the DDG-
51’s Aegis system. The DDG-1000’s radar has much more capability for resisting
enemy electronic countermeasures and for detecting targets amidst littoral “clutter.”
As a result of the better performance amidst littoral clutter, the Navy believes that
ships escorted by the DDG-1000 in defended littoral waters would have three times
as much survivability as ships escorted by the DDG-51.
The two designs would use the same types of area-defense and point-defense
interceptor missiles. They would also use the same flares, chaff, and decoys to
confuse enemy anti-ship cruise missiles, but the Navy believes these devices would
be more effective on the DDG-1000 because of the DDG-1000’s reduced signatures.
Anti-Surface Warfare/Strike Warfare. The DDG-1000 would have
considerably more naval surface fire support (NSFS) capability than the DDG-51.
The DDG-51 has one 5-inch gun, while the DDG-1000 has two 155mm Advanced
Gun Systems (AGSs). The DDG-51’s gun can fire an initial salvo of 20 rounds per
minute and can subsequently fire at a sustained rate of four rounds per minute (20/4).
The DDG-1000’s two guns have a combined firing rate of 20/20. The shells
currently fired by the DDG-51’s gun have a range of 13 nm. Future shells are to have
a range of up to 50 nm. The shells to be fired by the DDG-1000’s guns are to have
a range of 63 to 74 nm, and consequently could cover (at 74 nm) more than three
times as much area ashore (assuming a 25 nm standoff from shore) as a shell with a
range of 50 nm. The shells fired by the DDG-51 carry 8 pounds of explosive, while
those fired by the DDG-1000 are to carry 24 pounds of explosive. When fired at less
than maximum range, the shells fired by the DDG-1000 can alter their flight paths
so that six to eight of them can hit a target at the same time; the shells to be fired by
the DDG-51 do not have this capability. The DDG-51 carries 600 of the 13nm-range
shells or 230 of 62nm-range shells, while the DDG-1000 carries a total of 600 of its
49 C4I stands for command and control, communications, computers, and intelligence.

CRS-39
shells. It might be possible to fit the DDG-51 with one of the 155mm guns to be
carried by the DDG-1000; it would likely require the removal of both the DDG-51’s
5-inch gun and its forward (32-cell) VLS. In this configuration, the DDG-51 might
carry about 120 of the gun’s 155mm shells.
The 155mm guns on the DDG-1000 could be replaced in the future with an
electromagnetic rail gun or directed-energy weapon. The DDG-51 does not have
enough electrical power to support such weapons.
Antisubmarine Warfare (ASW). The DDG-51’s sonar system is more
capable for blue-water ASW operations, while the DDG-1000’s system is more
capable for littoral ASW operations. The DDG-1000’s bow-mounted sonar and
towed array can interact to more rapidly triangulate targets. The Flight IIA DDG-51
lacks a towed array. The DDG-1000’s radar would have more capability than the
DDG-51’s radar for detecting submarine periscopes.
The DDG-51 has six torpedo tubes for firing lightweight (12.75-inch diameter)
anti-submarine torpedoes, while the DDG-1000 has none, but the Navy does not
believe these tubes to be of significant operational value against potential future
threats. Both ships can launch lightweight torpedoes from their helicopters or fire the
Vertical Launch Antisubmarine Rocket (VLA), which is armed with a lightweight
torpedo.
The ships would use the same countermeasures for confusing enemy torpedoes,
but the Navy believes these countermeasures would be more effective on the DDG-
1000 because of the DDG-1000’s reduced signatures.
Mine Warfare (MIW). The DDG-1000’s bow-mounted sonar includes an in-
stride mine-avoidance capability; the DDG-51’s sonar suite has less capability for
detecting mines. The DDG-51 can be built to a design that permits the ship to
embark and operate the Remote Minehunting System (RMS); six ships in the DDG-
51 program (DDGs 91 to 96) have been built to this design. The Navy says that the
DDG-1000’s reduced acoustic and magnetic signatures would translate into a
significantly greater operating area in mined waters.
Missiles for Performing Above Missions. The DDG-51 has 90 missile-
launching tubes in its VLS, while the DDG-1000 has 80. The DDG-51’s VLS tubes
can accommodate a missile up to 21 inches in diameter, 21 feet in length, and about
3,000 pounds in weight. The DDG-1000’s VLS tubes can accommodate a missile
up to 24 inches in diameter, 22 feet in length, and about 4,000 pounds in weight. The
gas-management (i.e., heat-management) system of the DDG-1000’s VLS tubes can
accommodate a hotter-burning missile than the gas-management system of the DDG-
51’s VLS, so the DDG-1000 might be more capable of using future missiles if they
are hotter-burning.
Aviation for Performing Above Missions. The DDG-51 can embark and
operate two SH-60 helicopters but does not have electronics for launching and
recovering unmanned aerial vehicles (UAVs). The DDG-1000 can embark, operate,
and provide full maintenance for two SH-60 helicopters or one SH-60 helicopter and
three UAVs. The DDG-1000’s flight deck is larger than the DDG-51’s and can

CRS-40
accommodate all joint rotary-wing aircraft, including the MV-22, the CH-53, and the
H-47. The DDG-1000’s flight deck is 10 feet higher off the water and can therefore
be used for full flight operations in a sea state (i.e., sea condition) that is at least one
step higher (i.e., rougher) than is possible for the flight deck on the DDG-51.
Special Operations Forces (SOF) Support. The DDG-1000 has
additional berthing for 20 SOF personnel (i.e., a platoon), as well as a space for SOF
mission planning and spaces for stowing SOF gear. The DDG-51 lacks these
features.
Boats. The DDG-51 can embark two seven-meter boats that are deployed and
recovered with a davit. The DDG-1000 can embark two 11-meter boats and four
rubber raiding craft that are deployed and recovered with a stern ramp, which permits
faster and safer launching and recovering, and launch/recovery operations in higher
sea states.
Habitability Features for Crew. On the DDG-51, enlisted crew berthing
spaces accommodate 20 to 60 sailors each. On the DDG-1000, every sailor would
have a stateroom, and each stateroom would accommodate four sailors. The Navy
believes these features would improve crew quality of life, which can improve
retention rates.
April 10, 2008, Navy Briefing to CRS and CBO
At an April 10, 2008, briefing to CRS and CBO, Navy officials presented a
briefing slide providing a comparison of the DDG-1000 design’s capabilities relative
to the DDG-51 design’s capabilities. The briefing slide is reprinted below (with
some editing changes for readability) as Table 4.

CRS-41
Table 4. DDG-1000 Capabilities Relative to DDG-51 Capabilities
Item
DDG-1000 compared to DDG-51
Radar cross section
Significantly smaller
Ship detectability by threat
Threat must fly lower and closer to detect the ship
aircraft
Firm track range on enemy
Significant improvement, especially in land-clutter
anti-ship cruise missiles
environments
Performance against small
Engage small boats at 3 times the effective range and
boat swarm raids
engage 10 times more threats
Safe operating area in areas
Significantly larger
with enemy bottom mines
Land attack capability
3 times as much lethality and 40% greater range than
Extended Range Guided Munition (ERGM)a
Manning
50% less crew
Electrical power
Sufficient capacity for rail gun, laser weapons, and
future radar upgrades
Source: Navy briefing slide #7, entitled “Multi-Mission Combatant,” in Navy briefing to
CRS and CBO, April 10, 2008. CRS has edited the words in the table to make them easier
to understand.
a. ERGM was a 5-inch extended-range guided munition for the 5-inch guns on Navy
cruisers and destroyers. The Navy in 2008 canceled development of ERGM.
In addition to the information presented in Table 4, another slide in the Navy
briefing stated that the DDG-1000’s radar cross section will be similar to that of a
fishing boat.50 Navy officials have also stated separately that the DDG-1000’s
acoustic signature will be similar, at certain speeds, to that of certain U.S. Navy
submarines.51
In elaborating on the point in Table 4 pertaining to the DDG-1000’s electrical
power, Navy officials stated at the briefing that at a speed of 20 knots, the DDG-1000
would have 58 megawatts of power available for powering non-propulsion shipboard
systems. The briefing stated that the DDG-51, by comparison, has 7.5 megawatts of
power available for non-propulsion systems.
May 7, 2008, Navy Letter to Senator Kennedy
A May 7, 2008, letter from Admiral Gary Roughead, the Chief of Naval
Operations (CNO), to Senator Edward Kennedy that was obtained by a defense trade
publication and posted on its website provided information on the comparative costs
and capabilities of the DDG-1000 and DDG-51. The letter stated:
50 Navy briefing slide #8, entitled “Zumwalt Advantage,” in Navy briefing to CRS and
CBO, April 10, 2008.
51 Source: Spoken testimony of Navy officials at hearing before Seapower subcommittee of
Senate Armed Services Committee on April 8, 2008.

CRS-42
Thank you for your letter of April 21, 2008, concerning cost estimates for
the continuation of the DDG 51 program and the DDG 1000 program.
As you indicated in your letter, without firm contracts for future ships of
either class, we are only able to provide a best estimate of the costs we would
incur in either of these programs. Since we are phasing out production of the
DDG 51 class, there would be start-up costs associated with returning this line
to production. As a result, the estimated end cost to competitively procure a lead
DDG-51 (Flight IIa — essentially a repeat of the final ships currently undergoing
construction) in Fiscal Year (FY) 2009 assuming a truncation of the DDG 1000
class after the two lead ships would be either $2.2B for a single ship or $3.5B for
two lead ships (built at competing production yards). This estimate is based on
a Profit Related to Offer (PRO) acquisition strategy. The average cost of
subsequent DDG 51 Flight IIa class ships would be about $1.8B (FY09) per ship
compared to the $2.6B estimated cost of subsequent DDG 1000 class ships.
Below is the breakdown of the one and two ship FY09 DDG 51 estimates,
compared to that of the DDG 1000 in the same year. DDG 1000 costs include
FY08 advanced procurement funds:
(FY$M)
DDG 51
DDG 51
DDG 1000
(FY09)
(FY09)
(FY09)
Qty
1
2
1
Plans/Basic
854.4
1607.8
1393.3
[construc-tion]
Change Orders
39.1
76.1
66.0
Government
1138.2
1556.7
1126.8
Furnished Equip
Other
56.4
57.5
66.6
Total Ship Cost
2088.1
3298.1
2652.6
The table provided below compared the annual operations and support costs
for the DDG 51 and DDG 1000 class ships.
(FY$M)
DDG 1000
DDG 51
Operating
$18.5
$15.7
(steaming)
Maintenance
$10.3
$5.6
Manpower
$8.5
$19.9
Total
$37.3
$41.2
Crew Size
14 officers
24 Officers
106 enlisted
272 Enlisted
The total annual cost for the DDG 51 is a class average based o 17 years of
operations and maintenance, and does not include personnel reduction savings
expected from the DDG Modernization program. While there are cost savings
associated with the DDG 1000’s smaller crew, they are largely offset by higher
estimated maintenance costs for this significantly more complex ship.

CRS-43
Clearly the relative value of the DDG 1000 resides in the combat system
(Dual-Band Radar, Volume Search Radar, ASW Suite, etc) that provide this ship
with superior warfighting capability in the littoral. However, the DDG 51 can
provide Ballistic Missile Defense capability against short and medium range
ballistic missiles and area Anti-Air Warfare capability (required in an anti-access
environment) where the DDG 1000 currently does not. Upgrading the DDG
1000 combat system with this capability would incur additional cost. The DDG
51 class also possesses better capability in active open ocean Anti-Submarine
Warfare than does the DDG 1000.
On balance, the procurement cost of a single DDG 51 is significantly less
than that of a DDG 1000, and the life-cycle costs of the two classes are similar.
I appreciate the opportunity to share my perspective on these two alternatives
with you. A similar letter has been sent to Senator Martinez. As always, if I can
be of further assistance, please let me know.52
On June 3, 2008, John Young, the Under Secretary of Defense for Acquisition,
Technology, and Logistics, in testimony to the Senate Armed Services Committee,
questioned the accuracy of the cost figures in the May 7 letter, stating, among other
things, that he believed the annual operating and support cost of the DDG-1000
would be about $10 million less than that of a DDG-51, and that the procurement
cost figures in the letter relied on certain assumptions that might not prove accurate.
Young’s testimony was viewed as defending the DDG-1000 more strongly than did
the CNO’s May 7, 2008, letter.53
July 2, 2008, DOD letter to Representative Taylor
A July 2, 2008, letter from John Young, the Under Secretary of Defense for
Acquisition, Technology and Logistics (i.e., the DOD acquisition executive), to
Representative Gene Taylor that was obtained by a defense trade publication and
posted on its website provides additional comments regarding the DDG-1000 and
DDG-51, as well as information about the readiness of the DDG-1000 design to enter
production. The letter stated:
I agree that the Navy’s preliminary design analysis for the next generation
cruiser indicates that, for the most capable radar suites under consideration, the
DDG 1000 hull cannot support the radar. This applies just as well to the DDG
51 hull. However, it is my understanding that engineering analysis shows that
the existing DDG 1000 hull design can support significantly more capable radar
suites than the existing DDG 51 hull design. Moreover, while it is not possible
to quickly estimate the production cost of a redesigned DDG 51 alternative, I
suspect that, given the dense and complex nature of the DDG 51 hull, as
52 Source: Letter dated May 7, 2008, from Admiral G. Roughead to the Honorable Edward
M. Kennedy, posted on the Internet at InsideDefense.com (subscription required) on May
30, 2008. Emboldening in the second table as in the original. See also Thomas Duffy,
“Navy Says DDG-100, DDG-51 Annual Operating Costs Are Rated Even,” Inside the Navy,
June 2, 2008.
53 See, for example, Emelie Rutherford, “Young Claims Inaccuracies, Assumptions In Navy
Destroyer Cost Comparison,” Defense Daily, June 5, 2008; and Dale Eisman, “Warning:
Delay On Ship Will Run Up Navy’s Costs,” Norfolk Virginian-Pilot,” June 4, 2008: D1.

CRS-44
compared to that of the DDG 1000 hull, the cost of a redesigned DDG 51 very
likely will be equal to or greater than that of a DDG 1000.
Your letter also warns that cost over-runs for the DDG 1000 program might
cripple the Navy’s shipbuilding programs. I am equally concerned that restarting
the DDG 51 program would pose risk to the shipbuilding budget and inject
additional cost for the following reasons:
— Direct production hours for one DDG 1000 ship are about 2.5 times
that of one DDG 51 restart ship. This validates DOD’s experience that two to
three DDG 51 destroyers need to be purchased annually to sustain the production
workload base for two surface combatant shipyards. That number of DDG 51
ships costs more per year than one DDG 1000 follow ship. The cost per year for
modified DDG 51 ships would be even higher.

— Several ship and vendor base issues,
including
equipment
obsolescence, main reduction gears, configuration change issues, and re-start of
production lines, would need to be resolved in order to award and construct
additional DDG 51 class ships.
— The costs for the two DDG 1000 ships wold increase if that program
is truncated to only two ships.
— There will be program shutdown costs for the DDG 1000 program if
the program is truncated to only two ships.
— The Research, Development, Test, & Evaluation efforts for the DDG
1000 program must continue in order to deliver two complete lead ships and to
support the Dual Band Radar for the CVN 21 program.
In reference to your concern that there is no Joint Requirements Oversight
Council (JROC) or U.S. Marine Corps requirement for fire support that can only
be provided by the DDG 1000, the JROC validated the Operational Requirements
Document (ORD) for the DDG 1000 program. The ORD includes a requirement
to provide precise and sustained naval fires at extended ranges. The DDG 1000
with its advanced Gun System firing the Long Range Land Attack Projectile is
the only ship that can achieve that validated requirement.
I remain convinced that the DDG 1000 program is poised for proper
execution. Unlike DDG 51, LPD 17, and LCS, where the level of concurrent
design, development, and construction were critical flaws, leading to significant
cost increases on the lead ships, the DDG 1000 program benefits from early
technology maturation, and experienced design team using a mature design tool,
proven production processes, and other factors as outlined below:
— Design Drawing Status: DDG 1000 is significantly more mature in
detail design than was LPD 17 or DDG 51 at the same points in the program. For
example, at the time of the Detail Design and Construction (DD&C) contract
award, DDG 1000 detail design products were 55 percent complete, compared
to 0 percent for LPD 17 and DDG 51. At the start of fabrication, DDG 1000
detail design products will be approximately 80-85 percent complete, compared
to 20 percent for DDG 51 and 20-30 percent for the two LCS designs. While
design products for the LPD 17 were also in the 80 percent complete range at the
start of fabrication, this came about only after a long delay to fix and prove the
design tool during the detail design phase, a lesson learned and avoided for the
DDG 1000 program.
— Initial Module Construction: The jointly developed design of DDG
1000 is on schedule to be more mature than any previous shipbuilding program

CRS-45
at start of construction. The design and build of the machinery block in advance
of first ship construction completed in June 2008. This effort has been extremely
beneficial as a risk reduction measure.
— Design Tool Maturity: The DDG 1000 team of contractors worked
together on 3-D modeling during preliminary and system design for 6 years in
advance of the DD&C phase.
— Early Technical Product Definition: Contractor-developed technical
products enabled early development of design products (system diagrams, vendor
statements of work, etc.), which are typically developed during the early stages
of detail design. DDG 1000 leveraged these early developments to help the
program reduce the risk of rework and poor quality than undermine early-start
initiatives such as those experienced on other shipbuilding programs.
— Technology Maturity: The combined DDG 1000 design team learning
and use of the 3-D Product Modeling Tool 6 years in advance of the DD&C
ensures that the right quantity of qualified human capital resources are allocated
in support of the DD&C phase.
— Phase III Cost Performance: Cost performance on DDG 1000 was
within 2.5 percent of budget on the $2.7B development effort on Phase III,
leading to the DD&C phase.
— Current Phase Cost Performance: The current design, development,
and integration contract is performing at an overall cost performance index of
1.02 and a schedule performance index of 0.99 through April 2008. Detail
design and transition to production are on cost and schedule.54
54 Source: Letter dated July 2, 2008, from John J. Young, Jr., to the Honorable Gene Taylor,
posted on the Internet at InsideDefense.com (subscription required) on July 11, 2008. See
also Geoff Fein, “DDG-1000 Hull Can’t Support Most Capable Radar Planned For CG(X),
Pentagon Official Says,” Defense Daily, July 11, 2008.

CRS-46
Appendix C. Potential Lower-Cost Ships
Lower-Cost Gunfire Support Ship. CBO and naval analyst Robert Work
of the Center for Strategic and Budgetary Assessments (CSBA) have both suggested,
as a lower-cost naval gunfire support ship, an AGS-equipped version of the basic hull
design of the San Antonio (LPD-17) class amphibious landing ship. Such a ship
might begin procurement in FY2009, following procurement of a final “regular”
LPD-17 amphibious landing ship in FY2008. CBO estimates that an initial AGS-
armed LPD-17 might cost about $1.9 billion, including $400 million detailed design
and nonrecurring engineering costs, and that subsequent ships might cost about $1.5
billion each.55
Lower-Cost Cruiser-Destroyer. A new-design, lower-cost cruiser-
destroyer might:
! start procurement as soon as FY2011, if design work were started
right away;
! incorporate many of the same technologies now being developed for
the DDG-1000 and CG(X);
! employ a modular, “plug-and-fight” approach to some of its weapon
systems, like the LCS;
! be similar to the DDG-1000 and CG(X) in terms of using a reduced-
size crew reduce annual operation and support costs;
! use a second-generation surface combatant integrated electric-drive
propulsion system that is smaller and lighter than the first-generation
system to be installed in the first DDG-1000s;56
! carry a payload — a combination of sensors, weapon launchers,
weapons, and aircraft — that is smaller than that of the DDG-1000
or CG(X), but still sizeable; and
! be built in one or two variants — an air- and missile-defense version
to replace the CG(X), which would preserve CG(X) radar
capabilities while reducing other payload elements, and possibly also
a surface fire support version to supplement the DDG-1000, which
55 See Congressional Budget Office, Options for the Navy’s Future Fleet, May 2006, pp. 56-
57 (Box 3-1).
56 The integrated electric-drive system to be installed in the first DDG-1000s uses advanced
induction motors. A second-generation system could use smaller and lighter motors and
generators that employ permanent magnet or high-temperature superconducting technology.
Both of these technologies are currently being developed. For more on these technologies,
see CRS Report RL30622, Electric-Drive Propulsion for U.S. Navy Ships: Background and
Issues for Congress
, by Ronald O’Rourke. (July 31, 2000)

CRS-47
would preserve the DDG-1000’s two AGSs while reducing other
payload elements.
Notional options for a lower-cost cruiser-destroyer include, but are not limited
to, the following:
! a ship displacing about 9,000 tons — about the same size as the
DDG-51; or
! a ship displacing about 11,000 tons — about 25% less than the
DDG-1000’s displacement of about 14,500 tons, about the same size
as the nuclear-powered cruisers procured for the Navy in the 1960s
and 1970s, and about 1,800 tons larger than the DDG-51.
Such a ship might be based on either the DDG-51 hull design, which is a
conventional flared hull that slopes outward as it rises up from the waterline, 57 or a
new flared hull design, or a reduced-sized version of the DDG-1000’s tumblehome
(inwardly sloping) hull design.
The Navy in 2002 identified the following ship-design characteristics as items
that, if varied, would lead to DDG-1000 concept designs of varying sizes,
capabilities, and procurement costs:
! cruising range,
! maximum sustained speed,
! number of Advanced Gun Systems (AGSs) and AGS shells,
! hangar space for helicopters and UAVs,
! undersea warfare systems (i.e., sonars and mine countermeasures
systems), and
! numbers and types of boats for special operations forces.
Using these variables, the Navy in 2002 developed notional DDG-1000 concept
designs with estimated full load displacements ranging from 12,200 tons to about
16,900 tons. One of the concept designs, with an estimated full load displacement
of about 12,700 tons, included 32 Advanced Vertical Launch System (AVLS) cells
(rather than the DDG-1000’s 80), two AGSs (like the DDG-1000), 600 AGS shells
(like the DDG-1000), a maximum sustained speed a few knots lower than the DDG-
1000’s, and a helicopter flight deck smaller than the DDG-1000’s. Another concept
design, with an estimated full load displacement of about 12,200 tons, included 64
AVLS cells, 1 AGS, 450 AGS rounds, a maximum sustained speed a few knots lower
than the DDG-1000’s, and helicopter flight deck smaller than the DDG-1000’s.
The Navy in 2003 developed another set of notional DDG-1000 concept designs
with estimated full load displacements ranging from 11,400 tons to 17,500 tons. One
of the concept designs, with an estimated full load displacement of 13,400 tons,
57 Using the DDG-51 hull in its current dimensions might produce a ship of about 9,000
tons; lengthening the DDG-51 hull with a mid-hull plug might produce a ship of about
11,000 tons.

CRS-48
included 64 AVLS cells, 1 AGS, and 450 AGS rounds. Another concept design, with
an estimated full load displacement of 11,400 tons, included 32 AVLS cells, 1 AGS,
and 300 AGS rounds.
The 2002 and 2003 notional DDG-1000 concept designs with displacements of
less than 14,000 tons appear to have preserved other DDG-1000 features, such as the
wave-piercing, tumblehome hull, the integrated electric drive system (though with
reduced total power in at least some cases), the total ship computing environment,
the autonomic fire-suppression system and other features permitting a reduced-sized
crew, the DDG-1000 radar suite, the hull and towed-array sonars, medium-caliber
guns for use against surface targets, and a helicopter hangar (though not necessarily
as large a hangar as on the DDG-1000).
Reducing payload features a bit more than under the smallest of the 2002 and
2003 notional concept designs might lead to a design with a displacement of about
9,000 to 11,000 tons. The Navy has viewed designs of less than 14,000 tons as
unsatisfactory because of their reduced individual capabilities. It is not clear,
however, to what degree the Navy’s assessment of such designs also takes into
account the difference that size (and thus unit procurement cost) can have on the total
number of ships that might be procured within available resources, and consequently
on future cruiser-destroyer force levels. Total cruiser-destroyer force capability is
dependent on both cruiser-destroyer unit capability and the total number of cruisers
and destroyers.
Notional Procurement Profiles With Lower-Cost Ships. Table 5 and
Table 6 show notional procurement profiles incorporating the ships described above.
In Table 5, an AGS-equipped version of the basic LPD-17 hull design is procured
to supplement the Navy’s DDG-1000s, and an air- and missile-defense version of the
smaller cruiser-destroyer is procured starting in FY2011 in lieu of the CG(X). In
Table 6, a smaller cruiser-destroyer in two versions — an AGS-equipped version to
supplement the Navy’s DDG-1000s, and air- and missile-defense version in lieu of
the CG(X) — is procured starting in FY2011.
Table 5. Alternative with LPD (AGS)
and Smaller Cruiser-Destroyer
(annual quantities procured, FY2007-FY2021)
07
08
09
10
11
12
13-21
Total
DDG-1000
2a
0a
1
1
4
LPD (AGS)b
1
1
1
2
5
SCDc
1
2/year
19
Source: Prepared by CRS.
a. Each of the two ships to be procured in FY2007 is to be split-funded across FY2007 and FY2008.
b. Basic LPD-17 hull equipped with 2 Advanced Gun Systems (AGSs).
c. Air- and missile-defense version of smaller cruiser-destroyer (SCD), in lieu of CG(X).

CRS-49
Table 6. Alternative with Smaller Cruiser-Destroyer
(annual quantities procured, FY2007-FY2022)
07
08
09
10
11
12
13-22
Total
DDG-1000
2a
0a
1
1
1
5
SCDb
1
2/year
21b
Source: Prepared by CRS.
a. Each of the two ships to be procured in FY2007 is to be split-funded across FY2007 and FY2008.
b. Includes 2 AGS-equipped versions of smaller cruiser-destroyer (SCD), for a total (along with 5
DDG-1000s) of 7 AGS-equipped ships, and 19 air- and missile-defense versions, in lieu of
CG(X).
CSBA Report Recommendations. A March 2007 report from the Center
for Strategic and Budgetary Assessments (CSBA) on the Navy’s surface combatant
force discusses existing and future Navy surface combatants and makes the following
recommendations (emphasis as in the original):
— First, “fold” the CG-21 hand: cancel all planned new CG-21s [i.e., DDG-
1000s and CG(X)s] beyond the two DDG-1000s already authorized.
58 A
variation of this plan would be to build just one ship. By building two (or one)
operational test beds/technology demonstrators, the Navy can recoup most of the
previous “bets” made on the CG-21s. Having one or two test ships would allow
further testing and refinement of the SPY-3 multifunction radar, which is to be
installed on future aircraft carriers regardless of what happens with the
DDG-1000, and perhaps on other ships. Over time, the ships could be modified
to test other future surface combatant combat systems such as underwater combat
systems or electronic warfare systems. Regardless of configuration, the ships
would provide the battle fleet with a test article for new integrated power system
components as well as electrically-powered weapons. In this role, the less
capable advanced induction motor to be installed on the first two DDG-1000s
ships will be as effective as the permanent magnet motor — the Navy’s desired
electric motor. The ships’ larger VLS cells would allow the Navy to test larger
diameter guided missiles. In fleet exercises, the ships would help to identify the
true operational payoffs of ship stealth within the context of distributed naval
battle networks. Finally, these large ships with small crews would help the Navy
to refine the maintenance concepts for future optimally manned fleet combatants
(i.e., warships with reduced crews).
— Second, “hold” the Aegis/VLS fleet: design a comprehensive, Aegis/VLS
Battle Network Reliability and Maintenance (BNRAM) program, with the
goal of producing the maximum number of interchangeable, Interim Large
Battle Network Combatants. (I-LBNCs).
The Navy’s ultimate goal is to shift
to a new Large Battle Network Combatant, or LBNC — a far better description
of future Total Force Battle Network [TFBN] ships-of-the-line than the
multimission guided-missile “cruisers” and “destroyers” or general-purpose
“destroyers” associated with today’s legacy Total Ship Battle Force. Until they
can be designed, betting an additional $10-15 billion on five or six additional
DDG-1000s would appear to provide far less of a TFBN payoff than making a
similar sized or even smaller bet on a well-thought-out and executed BNRAM
program to convert the 84 programmed Aegis/VLS warships into more powerful
58 The CSBA report uses the term CG-21s to refer collectively to DDG-1000s and CG(X)s.

CRS-50
I-LBNCs. This conversion program would be patterned after earlier
modernization and conversion efforts, like the Fleet Reliability and Maintenance
(FRAM) program, which converted many of the large legacy fleet of World War
II destroyers into effective Cold War ASW escorts. The BNRAM would include
a thorough mid-life upgrade to the ships’ hull, machinery and electrical (HM&E)
systems; a combat systems upgrade to allow the ships to counter emerging
threats; and a battle network upgrade to allow the ships to operate as part of a
coherent naval battle network. Consistent with battle network precepts, the intent
of the BNRAM would be to bring as many ships as possible to a common
I-LBNC combat system baseline. The BNRAM would also aim to lower
substantially the operations and maintenance costs (O&M) costs necessary to
operate the legacy Aegis/VLS fleet, in order to save money in the near term, and
to offset to some degree the added costs necessary to keep older ships in service
over the longer term. A key part of this effort centers on reducing the crew size
needed to operate, maintain, and fight the ships. Importantly, because this effort
can justifiably be seen as converting legacy Aegis/VLS ships into more capable
I-LBNCs, the BNRAM should be funded out of more stable Ship Construction
Navy (SCN) funds rather than the more volatile O&M accounts.
— Third, immediately kick-start a clean-sheet competition to develop and
design a family of next-generation Large Battle Network Combatants, with
close oversight by the newly reconstituted Ship Characteristics
Improvement Board (SCIB).
For nearly a century, the Navy’s SCIB — a group
of high-ranking DoN [Department of the Navy] officials — worked to balance
desired warship warfighting requirements against their impact on a ship’s final
design and production costs. The primary reason why the Navy lost cost control
over the DD-21/DD(X)/DDG-1000 was that just as the ship entered its design
definition phase, the power of the Navy’s SCIB was waning, replaced by a Joint
requirements definition process with no fiscal checks and balances. One of the
first things Admiral Mike Mullen, the current Chief of Naval Operations, did
upon assuming his office was to reconstitute the Navy’s SCIB. With a chance to
start from a clean sheet of paper, naval design architects could leverage an
additional decade of experience in the post-Cold War era to design an entirely
new family of next-generation LBNCs, under the close oversight of the newly
reconstituted SCIB. These new warships would have a common gas turbine or
perhaps even a nuclear power plant that supplies enormous shipboard electrical
generating capacity; common electric propulsion motors; common integrated
power systems that distribute electric power to the ships’ electric motors, combat
systems, and weapons, as needed; and advanced automation to enable them to
operate with relatively small crews. Their single common hulls, or network
frames, should be large and easily produced, based on the best ideas of naval
engineers, with an affordable degree of stealth. The network frames would be
able to accept a range of open architecture battle network mission modules
consisting of sensors and onboard and offboard weapons designed explicitly to
support a battle network rapid capability improvement strategy. The
cost-constrained goal for the combination of network frames and network
mission modules would be to build new LBNCs at a rate of five every two years,
allowing the complete transition from 84 Aegis/VLS I-LBNCs to 88
next-generation LBNCs in 35 years. The ships would be built under a
profits-related-to-offer arrangement. While each of the two remaining surface
combatant shipyards could count on building one LBNC per year, they would
compete for an extra ship every other year. The yard with the lowest bid would
be able to claim higher profit margins on the two LBNCs it would build until the
next bi-annual competition. In this way, in addition to the natural cost savings

CRS-51
due to learning curve efficiencies, the Navy would be able to spark continuous
competition between the two building yards.
— Starting in FY 2008, build a minimum of seven additional [Arleigh]
Burke-class DDGs [i.e., DDG-51s] to help sustain the industrial base until
the new LBNC is ready for production.
In effect, building one modified Burke
each year between FYs 2008 and 2014 would replace the seven DDG-1000s in
the current plan. For reasons that are detailed in the forthcoming report, the first
four modified Burkes would be configured with the same Area Air Defense
Command Capability System (AADCCS) found on the Ticonderoga-class CGs.
In addition, all seven ships would serve as active test beds for DDG
improvements identified as possible candidates for further BNRAM backfits, or
to test next-generation LBNC technologies. As such, the ships would serve much
the same purpose as both the Forrest Sherman-class destroyers — which helped
to bridge the shipbuilding gap between World War II combatants and Cold War
combatants designed to battle jets, missiles, and high-speed submarines — and
modified legacy combatants like the USS Gyatt, DDG-1, which helped to
illuminate the way forward toward a new generation of BFC combatants.
Provided all went as planned, Congress would authorize two of the
next-generation LBNCs in FY 2015, split funded as in the current arrangement
for the DDG-1000, giving each of the two remaining surface combatant
construction yards one ship. The general fleet-wide transition from Aegis/VLS
I-LBNCs to the new LBNC design would then begin in FY 2017, with three ships
authorized after a bidding competition. Of course, if the design was not ready for
production, additional Burkes could be built until it was.
— Task each of the planning yards for CG and DDG modernization to
design and implement a comprehensive follow-on maintenance regime to
ensure all Aegis/VLS combatants are able to serve out the remainder of
their 35-year service lives effectively.
The Navy’s plan counts on every one of
the 84 programmed Aegis/VLS combatants of completing 35 years of
commissioned service. Yet, since the end of World War II, few surface
combatants remain in commission beyond 25-30 years of service — even after
receiving mid-life upgrades. Unless the BNRAM program includes a sustained
maintenance regime beyond its mid-life HM&E, combat systems, and battle
network upgrades and crew reduction measures, it is unlikely the ships will see
their 35th year. The building shipyards might be the logical organizations to
implement this new maintenance regime on the Navy’s behalf. By establishing
financial incentives that provide the yards with bonuses for every year a ship
stays in service beyond 25 years, the Navy will maximize the probability that the
ships will remain in service. As part of their efforts, the yards and the Navy
should also solicit ideas for further ship improvements from vendors, and
complete the trade studies for an expanded service life extension program
(SLEP) of the existing ships, with a goal of extending their expected service lives
to 40 years. This would provide a hedge should design work on the next-
generation LBNC be delayed for any reason, or if a future maritime challenge
spurs the need to rapidly expand the number of large combatants beyond the 88
included in the 313-ship Navy.