Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress




Navy Constellation (FFG-62) Class Frigate
Program: Background and Issues for Congress

Updated March 27, 2024
Congressional Research Service
https://crsreports.congress.gov
R44972




Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Summary
The Navy began procuring Constellation (FFG-62) class frigates (FFGs) in FY2020, and a total
of six have been procured through FY2024. Current Navy plans call for procuring a total of at
least 20 FFG-62s. The Navy’s proposed FY2025 budget requests $1,170.4 million (i.e., about
$1.2 billion) for the procurement of the seventh ship in the program. The Navy’s FY2025 budget
submission programs the procurement of an additional six FFG-62s during the period FY2026-
FY2029 in annual quantities of 2-1-2-1.
FFG-62s are being built by Fincantieri/Marinette Marine (F/MM) of Marinette, WI. F/MM was
awarded a fixed-price incentive (firm target) contract for Detail Design and Construction
(DD&C) for up to 10 ships in the program—the lead ship plus nine option ships.
The FFG-62 program presents several potential oversight issues for Congress, including the
following:
• a 15-month delay in the scheduled delivery of the first FFG-62;
• the potential for cost growth in the FFG-62 program, particularly after the first 10
ships in the program;
• whether and when to introduce a second shipyard into the FFG-62 program;
• the number of vertical launch system (VLS) missile tubes in the FFG-62 design;
and
• technical risk in the FFG-62 program.
Congressional Research Service

link to page 5 link to page 5 link to page 5 link to page 5 link to page 5 link to page 5 link to page 5 link to page 6 link to page 6 link to page 7 link to page 7 link to page 9 link to page 10 link to page 13 link to page 14 link to page 15 link to page 15 link to page 15 link to page 17 link to page 19 link to page 20 link to page 21 link to page 22 link to page 23 link to page 26 link to page 26 link to page 26 link to page 27 link to page 27 link to page 27 link to page 27 link to page 27 link to page 28 link to page 28 link to page 7 link to page 8 link to page 8 link to page 9 link to page 11 Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Contents
Introduction ..................................................................................................................................... 1
Background ..................................................................................................................................... 1

Navy’s Force of Small Surface Combatants (SSCs) ................................................................. 1
SSCs in General .................................................................................................................. 1
SSC Force at End of FY2023 .............................................................................................. 1
SSC Force-Level Goal ........................................................................................................ 1

U.S. Navy Frigates in General .................................................................................................. 1
FFG-62 Class Program .............................................................................................................. 2
Program Name .................................................................................................................... 2
Ship Design and Capabilities .............................................................................................. 3
Procurement Quantities and Schedule ................................................................................ 3
Procurement Cost ................................................................................................................ 5
Acquisition Strategy............................................................................................................ 6
Competition and Contract Award ........................................................................................ 9
Delay in Delivery of First Ship ......................................................................................... 10
Issues for Congress ......................................................................................................................... 11
Delay in Delivery of First Ship ................................................................................................ 11
Potential for Cost Growth, Particularly After First 10 Ships ................................................... 11
Number of FFG-62 Builders ................................................................................................... 13
Number of VLS Tubes ............................................................................................................ 15
Technical Risk ......................................................................................................................... 16
June 2023 GAO Report ..................................................................................................... 17
January 2024 DOT&E Report .......................................................................................... 18
Press Reports ..................................................................................................................... 19
Legislative Activity for FY2024 and FY2025 ............................................................................... 22
Summary of Congressional Action on FY2024 Funding Request .......................................... 22
Summary of Congressional Action on FY2025 Funding Request .......................................... 22
FY2024 National Defense Authorization Act (H.R. 2670/S. 2226/P.L. 118-31) .................... 23
House ................................................................................................................................ 23
Senate ................................................................................................................................ 23
Enacted .............................................................................................................................. 23
House ................................................................................................................................ 23
Senate ................................................................................................................................ 24
Enacted .............................................................................................................................. 24


Figures
Figure 1. Oliver Hazard Perry (FFG-7) Class Frigate ..................................................................... 3
Figure 2. Constellation (FFG-62) Class Frigate .............................................................................. 4
Figure 3. Constellation (FFG-62) Class Frigate .............................................................................. 4
Figure 4. Constellation (FFG-62) Class Frigate .............................................................................. 5
Figure 5. FFG-62 Design Compared to FREMM Design ............................................................... 7

Congressional Research Service

link to page 9 link to page 26 link to page 26 link to page 30 link to page 32 Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Tables
Table 1. Programmed and Actual Annual FFG-62 Procurement Quantities ................................... 5
Table 2. Congressional Action on FY2024 Procurement Funding Request .................................. 22
Table 3. Congressional Action on FY2025 Procurement Funding Request .................................. 22

Appendixes
Appendix. Guaranty vs. Warranty in Construction Contract ......................................................... 26

Contacts
Author Information ........................................................................................................................ 28

Congressional Research Service

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Introduction
This report provides background information and discusses potential issues for Congress
regarding the Navy’s Constellation (FFG-62) class frigate program, a program to procure a new
class of at least 20 guided-missile frigates (FFGs). The Navy’s proposed FY2025 budget requests
$1,170.4 million (i.e., about $1.2 billion) for the procurement of the seventh ship in the program.
FFG-62s are being built by Fincantieri/Marinette Marine (F/MM) of Marinette, WI.
The FFG-62 program presents several potential oversight issues for Congress. Congress’s
decisions on the program could affect Navy capabilities and funding requirements and the U.S.
shipbuilding industrial base.
Background
Navy’s Force of Small Surface Combatants (SSCs)
SSCs in General
In discussing its force-level goals and 30-year shipbuilding plans, the Navy organizes its surface
combatants into large surface combatants (LSCs), meaning the Navy’s cruisers and destroyers,
and small surface combatants (SSCs), meaning the Navy’s frigates, Littoral Combat Ships
(LCSs), mine warfare ships, and patrol craft.1 SSCs are smaller, less capable in some respects,
and individually less expensive to procure, operate, and support than LSCs. SSCs can operate in
conjunction with LSCs and other Navy ships, particularly in higher-threat operating
environments, or independently, particularly in lower-threat operating environments.
SSC Force at End of FY2023
The Navy’s force of SSCs at the end of FY2023 consisted of 31 ships, including no frigates, 23
LCSs, and 8 mine warfare ships.
SSC Force-Level Goal
The Navy’s FY2025 30-year (FY2025-FY2054) shipbuilding plan calls for a future Navy of 381
manned battle force ships, including 73 SSCs, of which 15 are to be LCSs capable of conducting
mine warfare operations, plus 58 “FFG / FFG Flt II” ships, meaning 58 frigates and frigates built
to a modified (i.e., Flight II) design.2
U.S. Navy Frigates in General
In contrast to cruisers and destroyers, which are designed to operate in higher-threat areas,
frigates are generally intended to operate more in lower-threat areas. U.S. Navy frigates perform
many of the same peacetime and wartime missions as U.S. Navy cruisers and destroyers, but
since frigates are intended to do so in lower-threat areas, they are equipped with fewer weapons,

1 See, for example, CRS Report RL32665, Navy Force Structure and Shipbuilding Plans: Background and Issues for
Congress
, by Ronald O'Rourke.
2 U.S. Navy, Report to Congress on the Annual Long-Range Plan for Construction of Naval Vessels for Fiscal Year
2025, March 2024, Table 1 on page 4, column entitled “June 2023 BFSAR [Battle Force Ship Assessment and
Requirement] Report.
Congressional Research Service

1

link to page 7 Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

less-capable radars and other systems, and less engineering redundancy and survivability than
cruisers and destroyers.3
The most recent class of frigates operated by the Navy was the Oliver Hazard Perry (FFG-7) class
(Figure 1). A total of 51 FFG-7s were procured between FY1973 and FY1984. The ships were
built by three shipyards,4 entered service between 1977 and 1989, and were decommissioned
between 1994 and 2015. In their final configuration, FFG-7s were about 455 feet long and had
full load displacements of roughly 3,900 tons to 4,100 tons. (By comparison, the Navy’s Arleigh
Burke [DDG-51] class destroyers are about 510 feet long and have full load displacements of
roughly 9,700 tons.5) Following their decommissioning, a number of FFG-7s, like certain other
decommissioned U.S. Navy ships, have been transferred to the navies of U.S. allied and partner
countries.
FFG-62 Class Program
Program Name
The FFG-62 program was previously known as the FFG(X) program.6 On October 7, 2020, the
Navy announced that FFG-62 would be named Constellation, in honor of the first U.S. Navy
ships authorized by Congress in 1794—the six heavy frigates United States, Constellation,

3 Compared to cruisers and destroyers, frigates can be a more cost-effective way to perform missions that do not require
the use of a higher-cost cruiser or destroyer. In the past, the Navy’s combined force of higher-capability, higher-cost
cruisers and destroyers and lower-capability, lower-cost frigates has been referred to as an example of a so-called high-
low force mix. High-low mixes have been used by the Navy and the other military services in recent decades as a
means of balancing desires for individual platform capability against desires for platform numbers in a context of
varied missions and finite resources.
Peacetime missions performed by frigates can include, among other things, engagement with allied and partner navies,
maritime security operations (such as anti-piracy operations), and humanitarian assistance and disaster response
(HA/DR) operations. Intended wartime operations of frigates include escorting (i.e., protecting) military supply and
transport ships and civilian cargo ships that are moving through potentially dangerous waters. In support of intended
wartime operations, frigates are designed to conduct anti-air warfare (AAW—aka air defense) operations, anti-surface
warfare (ASuW) operations (meaning operations against enemy surface ships and craft), and antisubmarine warfare
(ASW) operations. U.S. Navy frigates are designed to operate in larger Navy formations or as solitary ships. Operations
as solitary ships can include the peacetime operations mentioned above.
4 The three shipyards were Bath Iron Works (BIW) of Bath, ME (now referred to as General Dynamics/Bath Iron
Works or GD/BIW), Todd Shipyards of Seattle, WA, and Todd Shipyards of San Pedro, CA. Todd Shipyards of Seattle
was acquired in 2011 by Vigor Shipyards. (See, for example, “Vigor Shipyards,” Wikipedia, edited January 22, 2024.)
Todd Shipyards of San Pedro was closed in 1989 following the completion of its FFG-7 construction work. (See, for
example, “Todd Pacific Shipyards, Los Angeles Division,” Wikipedia, edited January 26, 2023.)
5 This is the displacement for the current (Flight III) version of the DDG-51 design.
6 In the designation FFG(X), FF meant frigate, G meant guided-missile ship (indicating a ship equipped with an area-
defense anti-air warfare [AAW] system), and (X) indicated that the specific design of the ship had not yet been
determined. FFG(X) thus meant a guided-missile frigate whose specific design had not yet been determined.
The designation FF, with two Fs, means frigate in the same way that the designation DD, with two Ds, means
destroyer. FF is sometimes translated less accurately as fast frigate. FFs, however, are not particularly fast by the
standards of U.S. Navy combatants—their maximum sustained speed, for example, is generally lower than that of U.S.
Navy aircraft carriers, cruisers, and destroyers. In addition, there is no such thing in the U.S. Navy as a slow frigate.
Some U.S. Navy surface combatants are equipped with a point-defense AAW system, meaning a short-range AAW
system that is designed to protect the ship itself. Other U.S. Navy surface combatants are equipped with an area-
defense AAW system, meaning a longer-range AAW system that is designed to protect not only the ship itself, but
other ships in the area as well. U.S. Navy surface combatants equipped with an area-defense AAW system are referred
to as guided-missile ships and have a “G” in their designation.
Congressional Research Service

2

link to page 8 link to page 8 link to page 9
Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Constitution, Chesapeake, Congress, and President. FFG(X)s henceforth became known as
Constellation (FFG-62) class ships.
Figure 1. Oliver Hazard Perry (FFG-7) Class Frigate

Source: Photograph accompanying Dave Werner, “Fighting Forward: Last Oliver Perry Class Frigate
Deployment,” Navy Live, January 5, 2015, accessed September 21, 2017, at http://navylive.dodlive.mil/2015/01/05/
fighting-forward-last-oliver-perry-class-frigate-deployment/.
Ship Design and Capabilities
FFG-62s (Figure 2, Figure 3, and Figure 4) are to be multimission small surface combatants
capable of conducting anti-air warfare (AAW), anti-surface warfare (ASuW), antisubmarine
warfare (ASW), and electromagnetic warfare (EMW) operations. They are to be capable of
operating in both blue water (i.e., mid-ocean) and littoral (i.e., near-shore) areas, and capable of
operating either independently (when that is appropriate for their assigned missions) or as part of
larger Navy formations.
The FFG-62 design is based on the design of the Italian-French FREMM (Fregata Europea Multi-
Missione) frigate, a ship that has been built in two variants, one for the Italian navy and one for
the French navy. The FREMM design, in other words, served as what is known as the “parent”
design for the FFG-62 design. The use of a parent design for the FFG-62 program is discussed
further in the section below on the FFG-62 program’s acquisition strategy.
Procurement Quantities and Schedule
Total Procurement Quantity
The Navy wants to procure at least 20 FFG-62s. Navy budget documents, including the FY2025
budget-justification book for Navy’s shipbuilding account, describe the FFG-62 program as a 20-
ship program. As discussed earlier, however, the Navy’s FY2025 30-year (FY2025-FY2054)
shipbuilding plan calls for a future Navy of 381 manned battle force ships, including 58 “FFG /
FFG Flt II” ships, meaning 58 frigates and frigates built to a modified (i.e., Flight II) design.7 The

7 U.S. Navy, Report to Congress on the Annual Long-Range Plan for Construction of Naval Vessels for Fiscal Year
2025
, March 2024, Table 1 on page 4, column entitled “June 2023 BFSAR [Battle Force Ship Assessment and
Requirement] Report.
Congressional Research Service

3



Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

reference to a Flight II design might be interpreted as referring to a modified (i.e., Flight II)
version of the FFG-62 design. Such an interpretation would imply a combination of 20 (or more)
FFG-62s built to the original (i.e., Flight I) FFG-62 design plus 38 (or fewer) additional FFG-62s
built to a modified (i.e., Flight II) FFG-62 design.
Figure 2. Constellation (FFG-62) Class Frigate
Artist’s rendering of F/MM design

Source: Cropped version of il ustration accompanying Fincantieri Marinette Marine, “Fincantieri Marinette
Marine Awarded Second Constel ation-class Frigate,” May 20, 2021.
Figure 3. Constellation (FFG-62) Class Frigate
Computer rendering of F/MM design

Source: Fincantieri/Marinette Marine, screen capture from video entitled “Constel ation Class Frigate 360°
View,” posted at https://futurefrigate.com/, accessed December 8, 2020.
Congressional Research Service

4

link to page 9
Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Figure 4. Constellation (FFG-62) Class Frigate
Computer rendering of F/MM design

Source: U.S. Navy rendering shown on slide 2 of in Navy briefing entitled “Guided Missile Frigate (FFG 62)
Update, Sea Air Space [Exposition],” Captain Kevin Smith, April 5, 2022.
Annual Procurement Quantities
Table 1 shows programmed and actual annual procurement quantities for the FFG-62 program.
Table 1. Programmed and Actual Annual FFG-62 Procurement Quantities

FY20
FY21
FY22
FY23
FY24
FY25
FY26
FY27
FY28
FY29
Programmed

FY20 budget submission
1
2
2
2
2





FY21 budget submission

1
1
2
2
3




Dec. 9, 2020, document


1
3
3
4
4



FY22 budget submission


1
n/a
n/a
n/a
n/a



FY23 budget submission



1
2
1
2
1


FY24 budget submission




2
1
2
1
2

FY25 budget submission





1
2
1
2
1
Actual
1
1
1
1
2





Sources: Table prepared by CRS based on Navy’s FY2020-FY2025 budget submissions; December 9, 2020,
long-range Navy shipbuilding document; and enacted National Defense Authorization Acts (NDAAs) and DOD
Appropriations Acts for FY2020 and subsequent years.
Notes: n/a means not available. DOD’s FY2022 budget submission was a single-year budget that did not contain
line-item details for subsequent fiscal years.
Procurement Cost
FFG-62s generally have budgeted procurement costs of roughly $1.1 billion to $1.2 billion each.
The lead ship in the program has a higher estimated procurement cost ($1,386.7 million, or about
Congressional Research Service

5

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

$1.4 billion) than the follow-on ships because it is at the top of the production learning curve for
the class, and because the lead ship’s procurement cost incorporates much of the detailed
design/nonrecurring engineering (DD/NRE) costs for the class. (It is a traditional Navy budgeting
practice to attach most or all of the DD/NRE costs for a new ship class to the procurement cost of
the lead ship in the class.)
Acquisition Strategy
Number of Builders
The Navy’s baseline plan for the FFG-62 program envisages using a single builder at any one
time to build FFG-62s, but Navy officials have also spoken about the option of bringing a second
shipyard into the program at some point, particularly if annual procurement rates for FFG-62s rise
above two ships per year. An August 3, 2021, press report quoting a Navy official states
“It’s pre-decisional in the Navy right now but we do have in our contract a Technical Data
Package (TDP) that we can exercise that option all the way into the 10th ship. So our intent
is that, at some point based on a profile, we can exercise that TDP and then work with
candidate yards interested and then start building up on a second source and doing a
competition in the future,” [Capt. Kevin Smith, program manager of the new frigate class,
PMS-51] said during a briefing at the Navy League’s annual 2021 Sea Air Space expo
Monday [August 2] here.8
The Navy’s FY2025 30-year (FY2025-FY2054) shipbuilding plan states (emphasis added):
The Navy is mindful that as fleet composition evolves to meet competition and combat
requirements, the Navy must examine alternative opportunities within the industrial base.
Alternative opportunities include adjusting procurement profiles ensuring stability in
shipyard workload to prevent “boom and bust” periods of shipyard activity, and ensuring
ample competitive opportunities for current and future platforms (i.e., AS(X), LSM, T-
AOL, T-ARC), and a potential FFG 62 second source for construction once the design
and technical data package is mature and risks are reduced and validated
. These
opportunities allow the current industrial base to adapt while maintaining the capacity to
deliver the capability the nation needs.9
Parent-Design Approach
As noted earlier, FFG-62s are to be built to a modified version of an existing ship design—an
approach, called the parent-design approach, that can reduce design time, design cost, and cost,
schedule, and technical risk in building the ship. The Coast Guard and the Navy are currently
using the parent-design approach for the Coast Guard’s Polar Security Cutter (i.e., polar
icebreaker) program.10 The parent-design approach has also been used in the past for other Navy

8 Rich Abott, “Navy Outlines Plan For Second Frigate Shipyard,” Defense Daily, August 3, 2021.
9 U.S. Navy, Report to Congress on the Annual Long-Range Plan for Construction of Naval Vessels for Fiscal Year
2025
, March 2024, p. 13.
10 For more on the polar security cutter program, including the parent-design approach, see CRS Report RL34391,
Coast Guard Polar Security Cutter (Polar Icebreaker) Program: Background and Issues for Congress, by Ronald
O'Rourke.
Congressional Research Service

6

link to page 11
Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

and Coast Guard ships, including Navy mine warfare ships11 and the Coast Guard’s new Fast
Response Cutters (FRCs).12
Figure 5 shows a U.S. Navy briefing slide summarizing what the U.S. Navy says are the
“primary differences between the FFG 62 Class [design] and the FREMM Parent design.” The
Navy states that the design differences “were proposed by [the shipbuilding firm] Fincantieri and
incorporated [into Fincantieri’s proposed design for the FFG-62] prior to [the Navy’s] contract
award [for the FFG-62 program to Fincantieri].”13
Figure 5. FFG-62 Design Compared to FREMM Design

Source: Navy briefing slide provided to CRS and Congressional Budget Office (CBO) by Navy Office of
Legislative Affairs, August 27, 2021, with accompanying Navy information paper dated August 18, 2021.
An August 4, 2021, press report states
The Navy has chosen to elongate and widen the hull of its next-generation Constellation-
class frigate relative to the [FREMM] parent design, but the officer overseeing its
production says the internal layout will largely remain the same.

11 The Navy’s Osprey (MCM-51) class mine warfare ships are an enlarged version of the Italian Lerici-class mine
warfare ships.
12 The FRC design is based on a Dutch patrol boat design, the Damen Stan Patrol Boat 4708.
13 Source: Navy information paper dated August 18, 2021, on differences between FFG-62 design and FREMM parent
design, provided to CRS and the Congressional Budget Office (CBO) by Navy Office of Legislative Affairs on August
27, 2021.
Congressional Research Service

7

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

“The Italians did a very good job in the design of the internal spaces, and the flow of a lot
of those spaces,” Capt. Kevin Smith, program manager for the Constellation class, told
attendees at the Sea Air Space exposition on Monday [August 2]. “You could say we
bought a bigger house, [but] from a modeling and simulation perspective, it’s exactly the
same.”…
While some changes are to be expected to meet the Navy’s needs, enlarging the hullform
itself has the potential to change where components in the ship must be placed, as well as
the overall cost.
Asked about how possible changes in the ship’s hull could affect the internal design, Smith
said Fincantieri Marinette Marine, the Constellation’s prime contractor, worked with Naval
Surface Warfare Center Carderock to develop a scale model of the ship and that most
elements will stay true to the parent design. He cited the bridge and propulsion plant as
areas where the Navy has not made any significant changes to the layout.14

No New Technologies or Systems
As an additional measure for reducing cost, schedule, and technical risk in the FFG-62 program,
the Navy envisages developing no new technologies or systems for FFG-62s—the ships are to use
systems and technologies that already exist or are already being developed for use in other
programs.
FY2021 Legislation Regarding Land-Based Test Program for Engineering Plant
Section 125 of the FY2021 National Defense Authorization Act (H.R. 6395/P.L. 116-283 of
January 1, 2021) requires the Navy to commence, prior to the delivery of the first FFG-62, a land-
based test program for the FFG-62 engineering plant (i.e., its propulsion system and related
machinery). The provision specifies how the test program is to be conducted and requires the
Navy to complete the test program not later than the date on which the first FFG-62 is scheduled
to be available for tasking by operational military commanders.15

14 Justin Katz, “Navy Says Constellation Hull Change Won’t Affect Internal Design,” Breaking Defense, August 4,
2021.
15 Regarding Section 125, the conference report (H.Rept. 116-617 of December 3, 2020) on H.R. 6395/P.L. 116-283 of
January 1, 2021 states
Given that the Constellation-class will play a significant role in the Navy battle force for many
decades and the current program of record calls for building 20 frigates, the conferees believe a
strong technical foundation for this program is critically important.
The conferees note that the winning Constellation-class ship design is based on a foreign design.
While recognizing an existing parent design can reduce design, technical, and integration risks, the
conferees are concerned that significant risks remain in the FFG-62 program, including: cost
realism; shifting to predominantly U.S. component suppliers instead of the mainly foreign suppliers
used in the parent vessel design; and a complex Combined Diesel Electric and Gas Hull,
Mechanical and Electrical (HM&E) drive train that has not previously been used on U.S. Navy
ships.
The conferees believe land based engineering and test sites (LBETS) are critical resources for the
Department of Defense, particularly for Navy ship HM&E systems.…
Since 1972, NSWCPD LBETS testing has reduced the acquisition risk of five of the seven Navy
surface combatant classes (Spruance-class, Oliver Hazard Perry-class, Ticonderoga-class, Arleigh
Burke-class, and Zumwalt-class).… The littoral combat ship (LCS) classes, the Freedom- and
Independence-classes, are the two recent classes that have not had the benefit of a LBETS. Since
(continued...)
Congressional Research Service

8

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Legislation Regarding U.S. Content Requirements for Components
Section 856 of the FY2020 National Defense Authorization Act (S. 1790/P.L. 116-92 of
December 20, 2019) states
SEC. 856. APPLICATION OF LIMITATION ON PROCUREMENT OF GOODS
OTHER THAN UNITED STATES GOODS TO THE FFG–FRIGATE PROGRAM.
Notwithstanding any other provision of law, amounts authorized to carry out the FFG–
Frigate Program may be used to award a new contract that provides for the acquisition of
the following components regardless of whether those components are manufactured in the
United States:
(1) Auxiliary equipment (including pumps) for shipboard services.
(2) Propulsion equipment (including engines, reduction gears, and propellers).
(3) Shipboard cranes.
(4) Spreaders for shipboard cranes.
Section 8097(b) of the FY2024 DOD Appropriations Act (Division A of H.R. 2882/P.L. 118-47 of
March 23, 2024) states:
SEC. 8097….
(b) None of the funds provided in this Act for the FFG(X) Frigate program shall be used to
award a new contract that provides for the acquisition of the following components unless
those components are manufactured in the United States: Air circuit breakers;
gyrocompasses; electronic navigation chart systems; steering controls; pumps; propulsion
and machinery control systems; totally enclosed lifeboats; auxiliary equipment pumps;
shipboard cranes; auxiliary chill water systems; and propulsion propellers: Provided, That
the Secretary of the Navy shall incorporate United States manufactured propulsion engines
and propulsion reduction gears into the FFG(X) Frigate program beginning not later than
with the eleventh ship of the program.
Provisions similar to Section 8097(b) have been included in annual DOD appropriations acts
since the FY2020 DOD appropriations act.
Competition and Contract Award
Four industry teams competed for the FFG-62 program. On April 30, 2020, the Navy announced
that it had awarded the FFG-62 contract to the team led by Fincantieri/Marinette Marine (F/MM)
of Marinette, WI. F/MM was awarded a fixed-price incentive (firm target) contract for Detail
Design and Construction (DD&C) for up to 10 ships in the program—the lead ship plus nine
option ships. The other three industry teams reportedly competing for the program were led by

lead ship deliveries in 2008 and 2010, both LCS classes have encountered significant, costly, and
debilitating engineering failures. The conferees believe many of these LCS engineering failures
would have been discovered, analyzed, and corrected faster with less negative operational impact
had the Navy established a LCS LBETS.
Accordingly, the provision would require the Secretary of the Navy to establish a FFG-62 class
LBETS as soon as possible.…
In addition, the conferees direct the Secretary to submit to the congressional defense committees a
plan to implement this section with the budget materials that accompany the President’s Budget
request for fiscal year 2022. This plan shall include the costs, activities, and test plan necessary to
meet the requirements under this section. (Pages 1523-1524)
Congressional Research Service

9

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Austal USA of Mobile, AL; General Dynamics/Bath Iron Works (GD/BIW) of Bath, ME; and
Huntington Ingalls Industries/Ingalls Shipbuilding (HII/Ingalls) of Pascagoula, MS.
Under the DD&C contract, the Navy has the option of recompeting the program at any point prior
to the 10th ship. The Navy also has the option of seeking to convert the DD&C at some point into
a multiyear contract known as a block buy contract to procure the ships.16
Delay in Delivery of First Ship
In January 2024, it was reported that the delivery of the first ship in the program would be
delayed by at least one year, primarily due to shortages of workers at F/MM. A January 11, 2024,
press report stated
The first Constellation-class guided-missile frigate will deliver at least a year late due in
large part to workforce shortfalls at the Wisconsin yard where it’s built, USNI News has
learned.
The service has briefed Congress that the future USS Constellation (FFG-62) could deliver
in 2027 and that shipyard Fincantieri Marinette Marine has undergone an independent
review to assess the delay, a legislative source confirmed to USNI News this week.
During a program briefing on Thursday at the annual Surface Navy Symposium, the deputy
manager for the frigate program acknowledged potential schedule slippage in the program
due to the workforce issues. When asked for a ballpark on the schedule, Andy Bosak told
USNI News the assessment is “ongoing.”…
Fincantieri Marinette Marine is short by several hundred people across both the blue and
white-collar workforce, Bosak confirmed.
The yard in Marinette, Wis., is having trouble hiring welders, Capt. Kevin Smith, the
program executive officer for unmanned and small combatants, told an audience at the
same symposium. The workforce issues extend across multiple trades and disciplines,
Bosak said on Thursday [January 11].
To get after the workforce shortfalls, Fincantieri has received $50 million from the Navy
for the surface combatant industrial base. The yard is using that money to issue bonuses to
employees both in the blue and white-collar workforce to incentivize them to stay at
Marinette. Employees who work on the frigate in the Marinette yard starting Jan. 1, 2024,
and are still employed on Dec. 31, 2024, will receive $5,000, USNI News understands.
Employees who are working on the frigate in the Marinette yard and remain with the
program until the ship launches will receive another $5,000….
Fincantieri is also having issues managing the workforce rollover from its other programs,
the last Freedom-class Littoral Combat Ships [LCSs] and Saudi Arabia’s multi-mission
surface combatant [or MMSC, a variant of the LCS design]. Some engineers who were
supposed to roll over to the Connie [i.e., Constellation] program are still working on the
LCS or the MMSC.17
The Navy’s FY2025 budget submission shows the lead ship’s scheduled delivery date as December
2027—15 months later than the September 2026 scheduled delivery date shown in the Navy’s

16 For more on block buy contracting, see CRS Report R41909, Multiyear Procurement (MYP) and Block Buy
Contracting in Defense Acquisition: Background and Issues for Congress
, by Ronald O'Rourke.
17 Mallory Shelbourne and Sam LaGrone, “First Constellation Frigate Delayed At Least a Year, Schedule Assessment
‘Ongoing,’” USNI News, January 11, 2024. See also Megan Eckstein, “Frigate Program Delayed as Shipyard Is a ‘Few
Hundred’ Workers Short,” Defense News, January 11, 2024.
Congressional Research Service

10

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

FY2024 budget submission. The FY2025 budget submission states that delivery dates for the second
and subsequent ships in the program are under review.18
Issues for Congress
Delay in Delivery of First Ship
One potential oversight issue for Congress concerns the delay in the delivery of the first ship in
the program. Potential oversight questions for Congress include the following:
• What impact will the delay have on the delivery schedules for follow-on ships in
the program?
• What actions do the shipyard and the Navy plan to take to address the reported
worker shortages at the shipyard? How long will it take for those actions to
produce results, and how confident are the shipyard and the Navy that these
actions will be sufficient to eliminate the reported worker shortages? If these
actions include increasing pay and benefits for workers at the shipyard, what
impact will that have on the cost of FFG-62s (or other Navy ships) built at the
shipyard in coming years?
• To what degree do worker shortages at the shipyard reflect circumstances unique
to the shipyard? To what degree to they reflect circumstances affecting shipyards
across the country?
• What lessons for future Navy shipbuilding efforts, if any, can the shipbuilding
industry and the Navy learn from the delay in the delivery of the first ship?
Potential for Cost Growth, Particularly After First 10 Ships
Another potential issue for Congress concerns the potential for cost growth in the FFG-62
program, particularly after the first 10 ships in the program, which are to be procured under a
fixed-price incentive (firm target) contract. As discussed in greater detail in earlier versions of
this CRS report,19 CRS and CBO analyses done in 2020 suggested that if FFG-62s were to wind
up costing about the same to construct per thousand tons of displacement as other recent U.S.
military surface combatants, then FFG-62s could cost substantially more to build than their
budgeted unit procurement costs. The preliminary CRS analysis, done by CRS following the
Navy’s April 30, 2020, contract award in the FFG-62 program, suggested that if FFG-62s were to
wind up costing about the same to construct per thousand tons of displacement as other recent
U.S. military surface combatants, then the third and subsequent FFG-62s could cost 17% to 56%
more than the budgeted estimates for those ships in the Navy’s FY2021 budget submission. A
follow-on and more refined analysis of the issue that was done by CBO and released on October
13, 2020,20 and which also compared the Navy’s FFG-62 budgeted cost estimate to actual costs
for building other recent U.S. military surface combatants, estimated that the first 10 FFG-62s
would cost 40% more to build than the Navy estimates. An October 2023 CBO report on the cost
of the Navy’s FY2024 30-year shipbuilding plan, based on updated Navy and CBO figures,

18 Department of Defense, Fiscal Year (FY) 2025 Budget Estimates, Navy, Justification Book Volume 1 of 1,
Shipbuilding and Conversion, Navy
, March 2024, p. 234.
19 See, for example, the version dated December 21, 2022, or earlier versions dating back to the version of May 4,
2020.
20 Congressional Budget Office, The Cost of the Navy’s New Frigate, October 2020, 11 pp.
Congressional Research Service

11

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

estimated that FFG-62s on average will cost 10% to 20% more than the updated Navy
estimates.21
Depending on the exact terms of the fixed-price incentive (firm target) contract that the Navy
awarded to F/MM for the first 10 ships in the FFG-62 program, some portion (perhaps much) of
any cost growth that might occur on the first 10 FFG-62s could be borne by F/MM rather than the
Navy, although F/MM under such a circumstance might also have the option of seeking some
form of contractual relief from the Navy, which if granted could shift at least some of the cost
growth back to the government.22 If F/MM were to bear most or all of any cost growth that might
occur on the first 10 FFG-62s, then cost growth in the FFG-62 program, if it were to occur, might
not affect Navy budgeting substantially until the 11th ship in the program. Under the Navy’s
FY2025 budget submission, the 11th ship in the program is to be the first of the two ships that are
programmed for procurement in FY2028.
Potential oversight questions for Congress include the following:
• What is the Navy’s basis for its view that FFG-62s—ships that are to be about
three-quarters as large as U.S. Navy’s new Flight III Arleigh Burke (DDG-51)
class destroyers23 in terms of displacement, and with installed capabilities that are
in many cases similar to those of DDG-51s—can be procured for less than one-
half the cost of Flight III DDG-51s?
• Under the terms of the fixed-price incentive (firm target) contract that the Navy
awarded to F/MM for the FFG-62 program, what portion of any cost growth that
might occur on the first 10 FFG-62s might be borne by F/MM, and what portion
might be borne by the Navy?
• If the budgeted procurement costs of FFG-62s rise substantially starting with the
11th ship in the program, what impact, if any, would that have on the Navy’s
ability to afford other Navy program priorities? What impact, if any, would it
have on the cost effectiveness of the FFG-62 program relative to other Navy
investments?

21 Congressional Budget Office, An Analysis of the Navy’s Fiscal Year 2024 Shipbuilding Plan, October 2023, Table 8
on pp. 26-27. CBO states that the new estimated difference between CBO and the Navy of 10% to 20%, as opposed to
the 40% difference from CBO’s October 2020 report, is due to four factors: (1) an increase by the Navy since October
2020 in its estimated costs for building FFG-62s; (2) a decrease by CBO since October 2020 in its estimated costs for
building FFG-62s due to an updated treatment of inflation; (3) a shift by CBO from estimating the cost of ships 1
through 10 in CBO’s October 2020 report to ships 5 through 20 in CBO’s October 2023 report, which among other
things eliminated from the analysis the cost of the lead ship, where there is a fairly substantial difference between the
CBO and Navy estimates; and (4) the rounding off in CBO’s reports of Navy and CBO estimates to the nearest tenth of
a billion dollars per ship, which can shift resulting calculations of the percent difference in cost. (Source: CBO
telephone call with CRS, November 14, 2023.)
22 For example, in 2019, Eastern Shipbuilding Group of Panama City, FL, requested and received contractual relief for
Offshore Patrol Cutters (OPCs) that it is building for the Coast Guard. The relief was granted under P.L. 85-804 as
amended (50 U.S.C. 1431-1435), a law that authorizes certain federal agencies to provide certain types of extraordinary
relief to contractors who are encountering difficulties in the performance of federal contracts or subcontracts relating to
national defense. ESG reportedly submitted a request for extraordinary relief on June 30, 2019, after ESG’s
shipbuilding facilities were damaged by Hurricane Michael, which passed through the Florida panhandle on October
10, 2018. For additional discussion of the OPC program, including the contractual relief provided under P.L. 85-804,
see CRS Report R42567, Coast Guard Cutter Procurement: Background and Issues for Congress, by Ronald
O'Rourke. See also Congressional Budget Office, The Cost of the Navy’s New Frigate, October 2020, p. 11.
23 For more on the DDG-51 program, see CRS Report RL32109, Navy DDG-51 and DDG-1000 Destroyer Programs:
Background and Issues for Congress
, by Ronald O'Rourke.
Congressional Research Service

12

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Number of FFG-62 Builders
Another issue for Congress is whether and when to introduce a second shipyard into the FFG-62
program. The Navy’s FFG-7s, which were procured at annual rates of as high as eight ships per
year, were built at three shipyards. In considering whether to build FFG-62s at a single shipyard
or at two shipyards, Congress may consider several factors, including but not limited to the
annual FFG-62 procurement rate, shipyard production capacities and production economies of
scale, the potential costs and benefits in the FFG-62 program of employing recurring competition
between multiple shipyards, and how the number of FFG-62 builders might fit into a larger
situation involving the production of other Navy and Coast Guard ships, including Navy DDG-51
destroyers, Navy amphibious ships, and Coast Guard Offshore Patrol Cutters (OPCs).24
The Navy stated in 2022 that in terms of having a technical data package ready for a second
builder, the Navy could introduce a second builder into the FFG-62 program with a ship procured
as early as FY2024.25 At an April 18, 2023, hearing before the Senate Armed Services Committee
on the Navy’s proposed FY2024 budget, the following exchange occurred:
SENATOR ROGER WICKER (continuing):
And Secretary Del Toro, let’s talk briefly about frigates. Now we’re building those in
Wisconsin now.
THEN-SECRETARY OF THE NAVY CARLOS DEL TORO:
That’s correct, sir.
WICKER:
And—and the decision has been made to—to build the frigates there and at another
shipyard. Is that correct?
DEL TORO:
No, sir, not as of right now. The decis—
WICKER:
—That has not been made?
DEL TORO:
No, sir. That decision has not been made.
WICKER:
Ok, well, where are we on that?
DEL TORO:
We’re actually waiting for the completion of the [FFG-62] technical design package, which
is expected by the end of this year. Once that technical design package is fully mature and
submitted for review, we will review it. And at that point, we’ll make a decision on whether
we have the ability to actually take that technical data package and make sure that it’s

24 For more on the DDG-51 program, see CRS Report RL32109, Navy DDG-51 and DDG-1000 Destroyer Programs:
Background and Issues for Congress
, by Ronald O'Rourke. For more on Navy amphibious shipbuilding programs, see
CRS Report R43543, Navy LPD-17 Flight II and LHA Amphibious Ship Programs: Background and Issues for
Congress
, by Ronald O'Rourke. For more on the OPC program, see CRS Report R42567, Coast Guard Cutter
Procurement: Background and Issues for Congress
, by Ronald O'Rourke.
25 Source: Navy FY2023 program briefing for CRS and CBO, May 10, 2022.
Congressional Research Service

13

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

mature enough to actually compete, perhaps compete with another shipyard, so that we can
have two shipyards building the Constellation class—
WICKER:
Well, we’re going to need four years, is that right?
DEL TORO:
I’m sorry, sir?
WICKER:
We’re going to need four frigates a year. And that—that concept is a way to get that, is that
correct?
DEL TORO:
No, sir. Right now, the president’s budget recommends [a] sawtooth [FFG-62
procurement] pattern [with annual quantities] of two, one, two, one, moving forward. So
it’s two frigates a year that we will initially need.
WICKER:
How—Admiral Gilday, how important would it be to—to move to [a procurement rate of]
four [per year]?
THEN-CHIEF OF NAVAL OPERATIONS MICHAEL M. GILDAY:
I think very important, based on the comments both you and the chairman [made] at the
opening of the committee [hearing]. If we could get to a second shipyard, and [procure]
two a year from each shipyard, [while also procuring from other shipyards] two destroyers,
two to three destroyers a year, we’d be in a much better place. We are catching up, and you
can’t buy back time, sir, with the seven shipyards that we have [currently involved in
building the Navy’s larger and more complex ships], relative to the 30 [shipyards that
existed in the United States] that we had years ago.
WICKER:
It’s going to be hard to get to four a year, without designating two shipyards, do you agree?
GILDAY:
I agree. I also agree with—with the secretary’s comments. I think two—two shipyards is
in the plan. We want to make sure that we’re measuring twice and cutting once [regarding
the correctness of the details of the FFG-62 design] before that decision is made.26
The explanatory statement for the FY2022 DOD Appropriations Act (S. XXXX) that the Senate
Appropriations Committee released on October 18, 2021, stated (emphasis added)
While the Committee recognizes the significant role that CCF [Constellation-class frigate]
will have in the future Navy battle force, and is based on a proven hull design and mature
shipboard technologies, it remains a new class and presents typical first-in-class production
challenges. The Committee notes the past challenges of the Navy and shipbuilding
industrial base in managing costs, technical concurrency, design changes, and schedule of
lead ships of a class. The Committee is concerned that prematurely adding a second CCF
shipyard before the first shipyard has identified and corrected technical and production
issues will inject unneeded risk and complexity into the program. Therefore, prior to
award of a contract for a second CCF shipyard, the Committee directs the Secretary


26 Source: CQ transcript. See also Sam LaGrone, “CNO: ‘Very Important’ to Add 2nd Constellation-class Shipyard,
Build 4 Frigates a Year,” USNI News, April 18, 2023; Rich Abott, “CNO Says ‘Very Important To Get Second Frigate
Shipyard and Build Four Per Year,” Defense Daily, April 19, 2023.
Congressional Research Service

14

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

of the Navy to prioritize the following objectives: technology maturation and risk
reduction for critical shipboard components; major systems integration; full ship
technical data package creation; and successful operationally realistic testing for the
first ship.
The Committee also understands that setting up the CCF manufacturing
capacity, workforce, and supply chain requires consistent year-over-year funding to meet
the demand for production ramp up. Therefore, the Committee directs the Secretary of the
Navy to submit a report not later than 90 days prior to awarding a contract for the second
CCF shipyard to the congressional defense committees outlining the acquisition strategy
for achieving the full Frigate Program of Record and meeting these technology maturation
and risk reduction objectives. (PDF page 108 of 253)
The Navy stated in 2022 that the above report language, particularly the requirement for
successful operationally realistic testing for the first ship, could be read as barring the
introduction of a second builder into the FFG-62 until sometime after the first FFG-62 ship is
delivered.27 Another possible perspective on the above report language is that it would bar the
introduction of a second builder into the program until the Secretary of the Navy prioritizes the
objective
of successful operationally realistic testing of the first ship, which is not the same as
conducting successful operationally realistic testing. Under this interpretation, prioritizing this
objective (i.e., designating it as an important objective) is something that the Secretary of the
Navy could do immediately.
Number of VLS Tubes
Another potential oversight issue for Congress—one discussed in this CRS report since April
201928—concerns the number of vertical launch system (VLS) missile tubes in the FFG-62
design. The VLS is the FFG-62’s principal (though not only) means of storing and launching
missiles. FFG-62s are to each be equipped with 32 Mark 41 VLS tubes. (The Mark 41 is the
Navy’s standard VLS design.)
Supporters of requiring each FFG-62 to be equipped with a larger number of VLS tubes, such as
48, might argue that FFG-62s are to be roughly three-quarters as large as the Navy’s DDG-51
class destroyers, and might therefore be more appropriately equipped with at least 48 VLS tubes,
which is one-half the number on recent DDG-51s. They might also argue that in a context of
renewed great power competition with potential adversaries such as China, which is steadily
improving its naval capabilities,29 it might be prudent to equip each FFG-62 with 48 rather than
32 VLS tubes each, and that doing so might only marginally increase FFG-62 unit procurement
costs. They might also argue that equipping each FFG-62 with 48 rather than 32 VLS tubes will
permit the Navy to more fully offset a substantial reduction in VLS tubes that the Navy’s surface
fleet is projected to experience when the Navy’s 22 Ticonderoga (CG-47) class cruisers, which
are each equipped with 122 VLS tubes, are retired,30 and provide a hedge against the possibility

27 Source: Navy FY2023 program briefing for CRS and CBO, May 10, 2022.
28 See page 11 of the April 19, 2019, update of this CRS report.
29 For more on China’s naval modernization effort, see CRS Report RL33153, China Naval Modernization:
Implications for U.S. Navy Capabilities—Background and Issues for Congress
, by Ronald O'Rourke.
30 See, for example, Megan Eckstein and Joe Gould, “Lawmakers Crunching the Numbers on Potential Surface Navy
Additions to FY22 Spending Plan,” Defense News, June 17, 2021; Mallory Shelbourne, “Lawmakers Probe Navy’s
Plan to Decommission Cruisers, Navy Says Cuts Will Save $5B Across FYDP,” USNI News, June 17 (updated June
18), 2021; Megan Eckstein, “Lawmakers Are Worried About the US Navy’s Spending Plan and a Near-Term China
Threat,” Defense News, June 15, 2021; Mallory Shelbourne, “CNO Gilday: Flat or Declining Navy Budgets ‘Will
Definitely Shrink’ the Fleet,” USNI News, June 15, 2021; Blake Herzinger, “The Budget (and Fleet) That Might Have
Been,” War on the Rocks, June 10, 2021; David B. Larter, “As the US Navy Scrambles to Field More Missiles in Asia,
a Tough Decision Looms for Aging Cruisers,” Defense News, April 12, 2021.
Congressional Research Service

15

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

that Navy plans to field VLS tubes on Large Unmanned Surface Vehicles (LUSVs)31 will be
slowed or curtailed for technical or other reasons.
Supporters of having each FFG-62 be equipped with 32 VLS tubes might argue that the analyses
indicating a need for 32 VLS tubes already took improving adversary capabilities (as well as
other U.S. Navy capabilities) into account. They might also argue that FFG-62s, in addition to
having 32 VLS tubes, will also to have separate, deck-mounted box launchers for launching 16
anti-ship cruise missiles, as well as a separate, 21-cell Rolling Airframe Missile (RAM) AAW
missile launcher; that Navy plans continue to call for eventually deploying additional VLS tubes
on LUSVs, which are to act as adjunct weapon magazines for the Navy’s manned surface
combatants; and that increasing the number of VLS tubes on each FFG-62 from 32 to 48 would
increase (even if only marginally) the procurement cost of a ship that is intended to be an
affordable supplement to the Navy’s cruisers and destroyers.
A May 14, 2019, Navy information paper on the cost impact of expanding the FFG-62 VLS
capacity from 32 cells to 48 cells states
To grow from a 32 Cell VLS to a 48 Cell VLS necessitates an increase in the length of the
ship with a small beam increase and roughly a 200-ton increase in full load displacement.
This will require a resizing of the ship, readdressing stability and seakeeping analyses, and
adapting ship services to accommodate the additional 16 VLS cells.
A change of this nature would unnecessarily delay detail design by causing significant
disruption to ship designs. Particularly the smaller ship designs. Potential competitors have
already completed their Conceptual Designs and are entering the Detail Design and
Construction competition with ship designs set to accommodate 32 cells.
The cost is estimated to increase between $16M [million] and $24M [million] per ship.
This includes ship impacts and additional VLS cells.32
Compared to an FFG-62 follow-on ship unit procurement cost of roughly $1.1 billion to $1.2
billion, the above estimated increase of $16 million to $24 million would equate to an increase in
unit procurement cost of about 1.3% to about 2.2%.33 The estimated figure of $16 million to $24
million, however, dates to 2019. Inflating it to current costs would produce a percentage increase
in total ship procurement cost that would be somewhat greater than 1.3% to 2.2%.
Technical Risk
Another potential oversight issue for Congress concerns technical risk in the FFG-62 program.
The Navy can argue that the program’s technical risk has been reduced by use of the parent-
design approach; by the decision to use only systems and technologies that already exist or are
already being developed for use in other programs, rather than new technologies that need to be
developed; and by the congressionally mandated requirement to conduct a land-based test
program for the ship’s engineering plant. Skeptics, while acknowledging these points, might
argue that lead ships in Navy shipbuilding programs nevertheless pose technical risk, because
they serve as the prototypes for their programs.

31 For more on the LUSV program, see CRS Report R45757, Navy Large Unmanned Surface and Undersea Vehicles:
Background and Issues for Congress
, by Ronald O'Rourke.
32 Navy information paper entitled “FFG(X) Cost to Grow to 48 cell VLS,” dated May 14, 2019, received from Navy
Office of Legislative Affairs on June 14, 2019.
33 For additional discussion, see Joseph Trevithick and Tyler Rogoway, “Does The Navy’s New Constellation Class
Frigate Have Enough Vertical Launch Cells?” The Warzone, January 31, 2024.
Congressional Research Service

16

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

June 2023 GAO Report
A June 2023 GAO report on the status of various DOD acquisition programs states the following
about the FFG-62 program:
Technology Maturity, Design Stability, and Production Readiness
The Navy identified no critical technologies for FFG 62. The program uses existing mature
systems for its combat and mission systems. However, the Navy expects that integrating
its new Enterprise Air Surveillance Radar (EASR) with the latest baseline of the Aegis
combat system on FFG 62 may present challenges. To mitigate the risks associated with
integration, the Navy procured an EASR emulator to integrate and test with relevant Aegis
system equipment in a lab environment. The program office stated it also expects to use
lessons learned from planned integration and testing of EASR capabilities on multiple other
ship classes—such as the Ford class aircraft carriers—before the radar’s installation on
FFG 62. Once the radar is installed on the lead ship, the program plans to begin testing the
radar interfaces and interoperability with other systems in early 2025. Even with these tests,
as we previously reported, the program’s test plan and 2026 delivery schedule for the lead
ship leaves little margin to address any issues identified in onboard integration testing
without risk of costly and time-intensive rework.
Since the Navy competitively awarded a detail design and construction contract for the
lead ship in April 2020, the FFG 62 program has been working to complete the functional
and detail design of the ship. The overall design incorporates significant changes compared
with the parent design for FFG 62. As we reported last year, these changes include a
lengthened hull, revised bow, and other changes to incorporate combat and mission
systems.
Program officials stated that over 90 percent of the FFG 62 functional design and 80
percent of the detail design—which adds 3D modeling to show the configuration of
equipment on the ship—were completed when construction began on the lead ship in
August 2022. They noted that these results align with the Navy’s general expectations for
design maturity needed before construction begins. However, beginning construction with
an incomplete functional design is inconsistent with leading practices and increases the risk
of costly design changes and rework. Such cost risk adds to existing cost growth challenges
with the lead ship. Specifically, the program office stated the contract’s estimated cost for
the lead ship has increased above the contract’s ceiling price due to a variety of factors,
including defense industrial base issues. March 2023 cost reporting shows the contract’s
estimated costs for the second and third ships are trending in a similar direction.
Program officials stated that the majority of the remaining functional design work is related
to incomplete software. They added that, before the program begins construction for any
of the ship’s 31 design zones, it will complete the detail design of the zone.
Software and Cybersecurity
Program officials stated that planned approval of the software development plan—which
we reported last year was delayed 11 months to February 2022—is now delayed to spring
2023. They noted that a lack of required information on contractor-furnished equipment
contributed to this additional delay. They also stated that they are working with the
shipbuilder on refining the plan based on Navy feedback.
Program officials said that they plan to inform software development with feedback from
formal testing performed by system operators. The program office added that it is using
early integration testing efforts and a land-based test site for hull, mechanical, and electrical
systems to manage potential software development risks.
The program office stated that it revised FFG 62 test plans to include a combined war
game-like exercise in late 2022 that tested cyber capabilities and supported an
Congressional Research Service

17

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

interoperability assessment for ship systems. The program also scheduled early integration
testing events in fiscal years 2024 and 2025 at available land-based test sites. According to
the program, these events are intended to assess network cybersecurity controls and reduce
shipboard integration risks for government- and contractor-furnished equipment. The
program plans to complete a major subsystem cybersecurity assessment in fall 2024 and a
full system assessment in 2027 following delivery of the lead ship.
Program Office Comments
We provided a draft of this assessment for program office review and comment. The
program office provided technical comments, which we incorporated where appropriate.
The program office stated that the critical design review and production readiness review—
both conducted in 2022—validated the design and shipyard readiness before moving into
the production phase in August 2022 with the start of construction on the first ship. It added
that these reviews assessed sufficient design maturity—with an 80 percent overall level of
completion—and assessed that the shipyard was ready to begin construction. According to
the program office, the second ship of the class will begin construction in mid-2023.
The program office also stated that it is establishing various test sites to demonstrate FFG
62 propulsion systems and to reduce combat system development and schedule risk
through systems integration testing. It added that it is implementing a system to enhance
ship maintenance and supply planning. The program office also noted its implementation
of a collaborative DOD initiative focused on the development and implementation of data
analysis and sustainment technology capabilities.34
January 2024 DOT&E Report
A January 2024 report from DOD’s Director, Operational Test and Evaluation (DOT&E)—
DOT&E’s annual report for FY2023—stated the following regarding the FFG-62 program:
TEST ADEQUACY
In March 2023, DOT&E published a classified FFG 62 EOA [early operational assessment]
report based on evaluations conducted between February 2022 and July 2022 and detailed
in the FY22 Annual Report. Evaluations were adequate to determine potential FFG 62
design risks that could affect operational effectiveness and suitability of the delivered ship.
The EOA provides the FFG 62 Program with an opportunity to consider modifications to
the ship design. The FFG 62 Program will also use the EOA to inform development of the
next TEMP [test and evaluation master plan] revision expected to be completed in FY25.
The Navy conducted the EOA in accordance with a DOT&E-approved test plan, and it was
observed by DOT&E.
In FY23, the Navy conducted testing against a large scale-model of a generic ship
incorporating characteristics typical of Navy standard ship structure and a responding mid-
deck plate to generate response data for under-bottom explosions. This test was similar to
the test detailed in the FY22 Annual Report but focused on different structure response.
Data from these tests provide validation data for survivability models used to predict the
magnitude and extent of damage from underwater threat weapons. The Navy conducted
this test in accordance with the DOT&E-approved test plan, and it was observed by
DOT&E.
In FY23, the FFG 62 Program approved the FFG 62 Verification, Validation, and
Accreditation (VV&A) Plans for the Advanced Survivability Assessment Program (ASAP)
and Navy Enhanced Sierra Mechanics (NESM) M&S [modeling and simulation] tools.
These plans are adequate to determine the sufficiency of these M&S within the LFT&E

34 Government Accountability Office, Weapon Systems Annual Assessment[:] Programs Are Not Consistently
Implementing Practices That Can Help Accelerate Acquisitions
, GAO-23-106059, June 2023, p. 148.
Congressional Research Service

18

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

[live fire test and evaluation] test strategy. Further, the Navy continued M&S modification
that incorporates new capabilities, including improvements in the blast and whipping
codes. The Navy is working closely with DOT&E on the development of M&S plans to
support the Detail Design Survivability Assessment Report that the FFG 62 Program
expects to publish in FY26.
PERFORMANCE
EFFECTIVENESS
No data are available to determine FFG 62 operational effectiveness due to FFG 62 being
in development. However, the FFG 62 design presents risks to operational effectiveness in
each of its primary mission areas: air warfare, anti-submarine warfare, and surface warfare.
Classified risks to operational effectiveness are in the FFG 62 EOA report. Unclassified
risks to operational effectiveness include that the FFG 62 design does not have a tracker
illuminator system, which is typically installed on other Aegis platforms, and that the
design crew size will be highly reliant on currently unproven system automation and human
system interfaces. The Navy acknowledges the risk of the current crewing strategy for FFG
62 and is working with the appropriate stakeholders to mitigate and eliminate the associated
risk to mission performance. Further, the FFG 62 Program reports that they currently have
sufficient access to technical information on the Thales CAPTAS-4 [variable-depth sonar]
needed to effectively integrate it with the AN/SQQ-89(V)16 [undersea warfare] system.
SUITABILITY
No data are available to determine FFG 62 operational suitability due to FFG 62 being in
development. Further, reliability, maintainability, and availability data for hull,
mechanical, and electrical systems are not yet available to identify associated risk in the
FFG 62 design.
SURVIVABILITY
No data are available to determine the cyber survivability of FFG 62 due to its early stage
of development. Cyber survivability was not assessed during the EOA.
Insufficient data are available to determine FFG 62 survivability due to ongoing LFT&E.
The Navy continued to close outstanding vulnerability knowledge gaps and support
validation of survivability M&S through additional large-scale underwater explosion
testing in FY23.
RECOMMENDATIONS
The Navy should:
1. Provide an update to the FFG 62 TEMP that includes the strategy to test anti-air warfare
mission capability.
2. Continue to monitor the development of the mission system autonomy/automation
components in the ship design to minimize risk to mission performance and system
maintenance capability, and if necessary, complete a reassessment of the adequacy of crew
sizing to allow opportunity to incorporate modifications of the ship design, should
additional crewing be required to support all intended missions.35
Press Reports
An April 13, 2022, press report stated

35 Director, Operational Test & Evaluation, FY 2023 Annual Report, January 2024, pp. 200-201.
Congressional Research Service

19

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

The Navy will begin construction on the first Constellation-class frigate this summer or
fall, later than the program’s goal to begin construction in April.
The program won’t start construction until the critical design review is completed,
according to Capt. Kevin Smith, the frigate program manager.
“You may say, ‘you've been working on design for a while.’ We want to make sure we get
it right before we start cutting steel. Lead ships are hard,” Smith said last week at the Navy
League’s Sea-Air-Space conference.36
A March 31, 2022, press report stated:
Following an announcement earlier this week that the Navy would cancel a key anti-
submarine warfare effort bound for the Littoral Combat Ship, the service today also said it
would replace that technology with an alternative system onboard the new Constellation-
class frigate.
Rear Adm. Casey Moton, a senior officer overseeing both ship classes, told a small group
of reporters that “following an assessment,” the Navy chose the CAPTAS-4 variable depth
sonar (VDS) made by Advanced Acoustics Concepts, a subsidiary of DRS and Thales, as
the new frigate VDS.
“The Navy assessed CAPTAS-4 as a low risk VDS option for FFG-62 due to its proven
performance, overall technical readiness level, low risk integration with the SQQ-89 ASW
combat system, ability to integrate with the frigate platform design and ability to meet the
in-yard need date for FFG-62,” Moton said....
The consequences for the last-minute change to the Navy’s contract with Raytheon are still
being worked out, Moton said, but he added that the company had been “professional”
throughout the process to date. The admiral also said he does not anticipate “very much of
a change” to the ship’s cost as a result of the new VDS.37
A January 2022 press report about whether changes made to FREMM parent design introduce
technical risk to the FFG-62 program stated
Experts told Breaking Defense that not all changes [from a parent design] are as inherently
risky as they might seem, and the Navy appears to have heeded lessons from previous
controversies....
“In terms of changes from a parent design… as you start to drive further away from a parent
design, there is the risk of cost increase, especially if you have immature equipment that
requires testing or fails testing,” said Steven Wills, a Navy strategy and policy expert at
CNA, a federally funded research and development center that provides advice to the
Pentagon....
When asked this month at the Surface Navy Association’s annual symposium about how
those changes could impact the program’s risk calculus, Capt. Kevin Smith, the
Constellation-class program manager, said the parent design is a starting point, but nothing
more.
“I think it was clear to everyone in Navy leadership as well as congressional leadership
that the parent is there as just that… think of it as a DNA,” he said. “But you do have to
take US Navy standards and apply those, and also the requirements.”...

36 Audrey Decker, “Frigate Construction Pushed Back from April Target Start Date,” Inside Defense, April 13, 2022.
37 Justin Katz, “Navy to Swap Sonar on New Frigate Following Years of Struggles with Testing,” Breaking Defense,
March 31, 2022. See also Megan Eckstein, “US Navy to Terminate DART Sonar Development with Raytheon,”
Defense News, March 31, 2022; Rich Abott, “Navy Cites Reasons For Ditching DART Sonar For LCS, Frigate,”
Defense Daily, September 1, 2022.
Congressional Research Service

20

link to page 30 Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

“The only thing that we’ve [the Navy] done actually—it’s a change to the requirements—
is buy American, because that was a statute from Congress,” Smith said, referring to
legislation mandating certain parts and percentages of US warships be manufactured
domestically....
But CNA’s Wills said one major difference between the FREMM and the Constellation,
the elongated hull form, is not surprising because of differences in how Europeans and the
United States go about building warships.
“You don’t incur a lot of costs in making the ship bigger. That shouldn’t slow you down.
That shouldn’t cause testing to fail,” he said. “You’re going to have to buy more steel and
there will be some changes. The benefit that they seem to be going for… is they’re looking
for some additional margins throughout the life of the ship.”
Matthew Collette, who teaches naval architecture and marine engineering at the University
of Michigan, said fully adopting a parent design without modification is “exceptionally
rare” especially for the US Navy, which has developed standards for internal layouts and
adheres to congressional policy dictating supply chain options.
“Changing the overall dimensions of the ship is probably lowering the overall risk to the
program, not raising it,” Collette told Breaking Defense. “Given that we are changing the
internals of the design, adhering strictly to the old hull form would actually increase the
overall risk to the program, as you end up adding complexity by trying to shoehorn in
components in a less-than-ideal layout.”
He cited the Ticonderoga-class cruisers and Whidbey Island-class dock landing ships as
examples where Navy programs have historically suffered because the service attempted
to maintain the ships’ external design while altering its internal layout.
Collette said there are three principles a shipbuilding program should follow to reduce the
risk of modifying a parent design. The first is choosing proven systems when swapping out
components. In the Constellation’s case, the Navy has done just that by choosing systems
such as Aegis, the Mk 41 Vertical Launching System and the SLQ-32 from the Surface
Electronic Warfare Improvement Program.
The second principle is to thoroughly test new components ashore, a requirement Congress
codified in law after finding out the Navy failed to do this on other systems that proved
troublesome for the Ford.
The last principle is having a completed definition of the parent design, such as a 3D model,
a parameter for which Collette and other analysts have no way of assessing from outside
the Navy’s program office.
“Even with some changes, the program is still benefiting from access to the original design
models, and the knowledge gained in building and operating vessels that are highly similar,
but no longer exactly the same, to the US Navy variant,” Collette said.38
See also the Appendix regarding the Navy’s use of a guaranty rather than a warranty in the Detail
Design and Construction (DD&C) contract for the first 10 ships in the FFG-62 program.

38 Justin Katz, “For Navy’s New Frigate, Design Changes Carry Risks and Rewards,” Breaking Defense, January 24,
2022.
Congressional Research Service

21

link to page 26 link to page 26 Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Legislative Activity for FY2024 and FY2025
Summary of Congressional Action on FY2024 Funding Request
Table 2
summarizes congressional action on the Navy’s FY2024 funding request for the FFG-62
program.
Table 2. Congressional Action on FY2024 Procurement Funding Request
Millions of dollars, rounded to nearest tenth.


Authorization
Appropriation

Request
HASC
SASC
Enacted
HAC
SAC
Enacted
Procurement
2,173.7
2,163.7
2,173.7
2,163.7
2,133.9
2,223.7
2,183.9
Advance procurement (AP)
0
0
0
0
0
0
0
(Procurement quantity)
(2)
(2)
(2)
(2)
(2)
(2)
(2)
Sources: Table prepared by CRS based on FY2024 Navy budget submission, committee and conference reports,
and explanatory statements on the FY2024 National Defense Authorization Act and the FY2024 DOD
Appropriations Act.
Notes: HASC is House Armed Services Committee; SASC is Senate Armed Services Committee; HAC is
House Appropriations Committee; SAC is Senate Appropriations Committee.
Summary of Congressional Action on FY2025 Funding Request
Table 2
summarizes congressional action on the Navy’s FY2025 funding request for the FFG-62
program.
Table 3. Congressional Action on FY2025 Procurement Funding Request
Millions of dollars, rounded to nearest tenth.


Authorization
Appropriation

Request
HASC
SASC
Enacted
HAC
SAC
Enacted
Procurement
1,170.4






Advance procurement (AP)
0






(Procurement quantity)
(1)






Sources: Table prepared by CRS based on FY2025 Navy budget submission, committee and conference reports,
and explanatory statements on the FY2025 National Defense Authorization Act and the FY2025 DOD
Appropriations Act.
Notes: HASC is House Armed Services Committee; SASC is Senate Armed Services Committee; HAC is
House Appropriations Committee; SAC is Senate Appropriations Committee.
Congressional Research Service

22

link to page 26 link to page 26 link to page 26 link to page 26 Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

FY2024 National Defense Authorization Act (H.R. 2670/S. 2226/P.L.
118-31)

House
The House Armed Services Committee, in its report (H.Rept. 118-125 of June 30, 2023) on H.R.
2670, recommended the funding levels shown in the HASC column of Table 2. The
recommended reduction of $10.0 million is for “Insufficient justification” (p. 445).
Senate
The Senate Armed Services Committee, in its report (S.Rept. 118-58 of July 12, 2023) on S.
2226, recommended the funding levels shown in the SASC column of Table 2.
S.Rept. 118-58 states
Frigate second shipyard study
The committee notes that the Department of the Navy will not be able to reach the policy
goal of 355 battle force ships unless it expands production. The U.S. Navy’s 30-year
shipbuilding plan, dated December 9, 2020, anticipated standing up a second shipyard for
the FFG–62 Constellation-class frigate in fiscal year 2023 and procuring four frigates in
fiscal year 2025. The committee further notes that the statement accompanying the
Consolidated Appropriations Act for Fiscal Year 2022 (Public Law 117–103) paused plans
for a second shipyard until the U.S. Navy proved the frigate design. With the first four
ships of the class due to start construction before the close of fiscal year 2024, the
committee believes the time is appropriate to study the requirements and schedule for a
second shipyard.
The committee directs the Secretary of the Navy to develop a plan for a second shipyard
to produce the Constellation-class frigate. The plan shall address: (1) The stability of
program requirements and maturity of ship design; (2) A schedule for ordering a mature
technical data package; (3) The contracting strategy to include how the U.S. Navy plans to
compete the second shipyard; (4) Funding requirements by fiscal year; and (5) Capacity of
the shipbuilding industrial base to support two construction yards for frigates to include
available workforce.
The Secretary of the Navy shall provide an interim briefing on such a plan to the
congressional defense committees not later than February 1, 2024. (Page 229)
Enacted
The conference report (H.Rept. 118-301 of December 6, 2023) on H.R. 2670/P.L. 118-31 of
December 22, 2023, recommended the funding levels shown in the authorization enacted column
of Table 2. The recommended reduction of $10.0 million is for “Insufficient justification” (p.
1412).
FY2024 DOD Appropriations Act (H.R. 4365/S. 2587/Division A of H.R. 2882/P.L. 118-47)
House
The House Appropriations Committee, in its report (H.Rept. 118-121 of June 27, 2023) on H.R.
4365, recommended the funding levels shown in the HAC column of Table 2. The recommended
reduction of $39.837 million is for “GFE [government-furnished equipment] unjustified growth”
($30.287 million) and “Change orders unjustified growth” ($9.550 million) (p. 145).
Congressional Research Service

23

link to page 26 link to page 26 Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Section 8093(b) of H.R. 4365, a recurring provision in the annual DOD appropriations act, states
SEC. 8093….
(b) None of the funds provided in this Act for the FFG(X) Frigate program shall be used to
award a new contract that provides for the acquisition of the following components unless
those components are manufactured in the United States: Air circuit breakers;
gyrocompasses; electronic navigation chart systems; steering controls; pumps; propulsion
and machinery control systems; totally enclosed lifeboats; auxiliary equipment pumps;
shipboard cranes; auxiliary chill water systems; and propulsion propellers: Provided, That
the Secretary of the Navy shall incorporate United States manufactured propulsion engines
and propulsion reduction gears into the FFG(X) Frigate program beginning not later than
with the eleventh ship of the program.
Senate
The Senate Appropriations Committee, in its report (S.Rept. 118-81 of July 27, 2023) on S. 2587,
recommended the funding levels shown in the SAC column of Table 2. The recommended
increase of $50.0 million is for “Program increase: Frigate industrial base and workforce
development” (p. 135).
Section 8095(b) of S. 2587, a recurring provision in the annual DOD appropriations act, states
SEC. 8095.…
(b) None of the funds provided in this Act for the FFG(X) Frigate program shall be used to
award a new contract that provides for the acquisition of the following components unless
those components are manufactured in the United States: Air circuit breakers;
gyrocompasses; electronic navigation chart systems; steering controls; pumps; propulsion
and machinery control systems; totally enclosed lifeboats; auxiliary equipment pumps;
shipboard cranes; auxiliary chill water systems; and propulsion propellers: Provided, That
the Secretary of the Navy shall incorporate United States manufactured propulsion engines
and propulsion reduction gears into the FFG(X) Frigate program beginning not later than
with the eleventh ship of the program.
Enacted
The explanatory report for Division A of H.R. 2882/P.L. 118-47 of March 23, 2024, provides the
funding levels shown in the appropriation enacted column of Table 2. The net increase of
$10.163 million above the requested amount includes a reduction of $30.287 million for “GFE
[government-furnished equipment] unjustified growth,” a reduction of $9.55 million for “change
orders unjustified growth,” and an increase of $50.0 million for “Program increase—frigate
industrial base and workforce development.” (PDF page 143 of 314)
Section 8097(b), a recurring provision in the annual DOD appropriations act, states
SEC. 8097….
(b) None of the funds provided in this Act for the FFG(X) Frigate program shall be used to
award a new contract that provides for the acquisition of the following components unless
those components are manufactured in the United States: Air circuit breakers;
gyrocompasses; electronic navigation chart systems; steering controls; pumps; propulsion
and machinery control systems; totally enclosed lifeboats; auxiliary equipment pumps;
shipboard cranes; auxiliary chill water systems; and propulsion propellers: Provided, That
the Secretary of the Navy shall incorporate United States manufactured propulsion engines
and propulsion reduction gears into the FFG(X) Frigate program beginning not later than
with the eleventh ship of the program.
Congressional Research Service

24

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress


Congressional Research Service

25

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

Appendix. Guaranty vs. Warranty in Construction
Contract
This appendix presents background information regarding the Navy’s use of a guaranty rather
than a warranty in the Detail Design and Construction (DD&C) contract for the first 10 ships in
the FFG-62 program. An August 2019 GAO report on the FFG-62 program states
The Navy plans to use a fixed-price incentive contract for FFG(X) detail design and
construction. This is a notable departure from prior Navy surface combatant programs that
used higher-risk cost-reimbursement contracts for lead ship construction. The Navy also
plans to require that each ship has a minimum guaranty of $5 million to correct shipbuilder-
responsible defects identified in the 18 months following ship delivery. However, Navy
officials discounted the potential use of a warranty—another mechanism to address the
correction of shipbuilder defects—stating that their use could negatively affect
shipbuilding cost and reduce competition for the contract award. The Navy provided no
analysis to support these claims and has not demonstrated why the use of warranties is not
a viable option. The Navy’s planned use of guarantees helps ensure the FFG(X) shipbuilder
is responsible for correcting defects up to a point, but guarantees generally do not provide
the same level of coverage as warranties. GAO found in March 2016 that the use of a
guaranty did not help improve cost or quality outcomes for the ships reviewed. GAO also
found the use of a warranty in commercial shipbuilding and certain Coast Guard ships
improves cost and quality outcomes by requiring the shipbuilders to pay to repair defects.
The FFG(X) request for proposal offers the Navy an opportunity to solicit pricing for a
warranty to assess the cost-effectiveness of the different mechanisms to address ship
defects.39
As discussed in another CRS report,40 in discussions of Navy (and also Coast Guard)
shipbuilding, a question that sometimes arises is whether including a warranty in a shipbuilding
contract is preferable to not including one. The question can arise, for example, in connection
with a GAO finding that “the Navy structures shipbuilding contracts so that it pays shipbuilders
to build ships as part of the construction process and then pays the same shipbuilders a second
time to repair the ship when construction defects are discovered.”41
Including a warranty in a shipbuilding contract (or a contract for building some other kind of
defense end item), while potentially valuable, might not always be preferable to not including
one—it depends on the circumstances of the acquisition, and it is not necessarily a valid criticism
of an acquisition program to state that it is using a contract that does not include a warranty (or a
weaker form of a warranty rather than a stronger one).
Including a warranty generally shifts to the contractor the risk of having to pay for fixing
problems with earlier work. Although that in itself could be deemed desirable from the
government’s standpoint, a contractor negotiating a contract that will have a warranty will
incorporate that risk into its price, and depending on how much the contractor might charge for
doing that, it is possible that the government could wind up paying more in total for acquiring the

39 Government Accountability Office, Guide Missile Frigate[:] Navy Has Taken Steps to Reduce Acquisition Risk, but
Opportunities Exist to Improve Knowledge for Decision Makers
, GAO-19-512, August 2019, summary page.
40 See CRS Report RL32665, Navy Force Structure and Shipbuilding Plans: Background and Issues for Congress, by
Ronald O'Rourke.
41 See Government Accountability Office, Navy Shipbuilding[:] Past Performance Provides Valuable Lessons for
Future Investments
, GAO-18-238SP, June 2018, p. 21. A graphic on page 21 shows a GAO finding that the
government was financially responsible for shipbuilder deficiencies in 96% of the cases examined by GAO, and that
the shipbuilder was financially responsible for shipbuilder deficiencies in 4% of the cases.
Congressional Research Service

26

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

item (including fixing problems with earlier work on that item) than it would have under a
contract without a warranty.
When a warranty is not included in the contract and the government pays later on to fix problems
with earlier work, those payments can be very visible, which can invite critical comments from
observers. But that does not mean that including a warranty in the contract somehow frees the
government from paying to fix problems with earlier work. In a contract that includes a warranty,
the government will indeed pay something to fix problems with earlier work—but it will make
the payment in the less-visible (but still very real) form of the up-front charge for including the
warranty, and that charge might be more than what it would have cost the government, under a
contract without a warranty, to pay later on for fixing those problems.
From a cost standpoint, including a warranty in the contract might or might not be preferable,
depending on the risk that there will be problems with earlier work that need fixing, the potential
cost of fixing such problems, and the cost of including the warranty in the contract. The point is
that the goal of avoiding highly visible payments for fixing problems with earlier work and the
goal of minimizing the cost to the government of fixing problems with earlier work are separate
and different goals, and that pursuing the first goal can sometimes work against achieving the
second goal.42
DOD’s guide on the use of warranties states the following:
Federal Acquisition Regulation (FAR) 46.7 states that “the use of warranties is not
mandatory.” However, if the benefits to be derived from the warranty are commensurate
with the cost of the warranty, the CO [contracting officer] should consider placing it in the
contract. In determining whether a warranty is appropriate for a specific acquisition, FAR
Subpart 46.703 requires the CO to consider the nature and use of the supplies and services,
the cost, the administration and enforcement, trade practices, and reduced requirements.
The rationale for using a warranty should be documented in the contract file....
In determining the value of a warranty, a CBA [cost-benefit analysis] is used to measure
the life cycle costs of the system with and without the warranty. A CBA is required to
determine if the warranty will be cost beneficial. CBA is an economic analysis, which
basically compares the Life Cycle Costs (LCC) of the system with and without the warranty
to determine if warranty coverage will improve the LCCs. In general, five key factors will
drive the results of the CBA: cost of the warranty + cost of warranty administration +
compatibility with total program efforts + cost of overlap with Contractor support +
intangible
savings.
Effective
warranties
integrate
reliability,
maintainability,
supportability, availability, and life-cycle costs. Decision factors that must be evaluated
include the state of the weapon system technology, the size of the warranted population,
the likelihood that field performance requirements can be achieved, and the warranty
period of performance.43

42 It can also be noted that the country’s two largest builders of Navy ships—General Dynamics (GD) and Huntington
Ingalls Industries (HII)—derive about 60% and 96%, respectively, of their revenues from U.S. government work. (See
General Dynamics, 2016 Annual Report, page 9 of Form 10-K [PDF page 15 of 88] and Huntington Ingalls Industries,
2016 Annual Report, page 5 of Form 10-K [PDF page 19 of 134].) These two shipbuilders operate the only U.S.
shipyards currently capable of building several major types of Navy ships, including submarines, aircraft carriers, large
surface combatants, and amphibious ships. Thus, even if a warranty in a shipbuilding contract with one of these firms
were to somehow mean that the government did not have pay under the terms of that contract—either up front or later
on—for fixing problems with earlier work done under that contract, there would still be a question as to whether the
government would nevertheless wind up eventually paying much of that cost as part of the price of one or more future
contracts the government may have that firm.
43 Department of Defense, Department of Defense Warranty Guide, Version 1.0, September 2009, accessed July 13,
2017, at https://www.acq.osd.mil/dpap/pdi/uid/docs/departmentofdefensewarrantyguide[1].doc.
Congressional Research Service

27

Navy Constellation (FFG-62) Class Frigate Program: Background and Issues for Congress

In response to a draft version of GAO’s August 2019 report, the Navy stated
As a part of the planning for the procurement of detail design and construction for FFG(X),
the Navy determined that a guaranty, rather than a commercial-type warranty, will be
implemented for the program. As a part of the FFG(X) detail design and construction
request for proposals [RFP] released on June 20, 2019, the Navy asked contractors to
include a limit of liability of at least $5 million per ship and a guaranty period of 18 months
beyond preliminary acceptance of each ship. Further, the solicitation allows offerors to
propose as additional limit of liability amount beyond the required $5 million amount, up
to and including an unlimited liability. This arrangement represents an appropriate balance
between price considerations and risks, ensuring that the shipbuilder is accountable for the
correction of defects that follow preliminary acceptance, while allowing each shipbuilder
to use its own business judgement in proposing the value of the limit of liability. The Navy
released the solicitation prior to this GAO recommendation and is unable to modify the
current solicitation because it would cause an unacceptable delay to the FFG(X) program.
To support the GAO recommendation to request pricing for an unlimited warranty, the
Navy will request pricing for unlimited warranty before exercising the first ship option and
evaluate the business case.44


Author Information

Ronald O'Rourke

Specialist in Naval Affairs



Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan
shared staff to congressional committees and Members of Congress. It operates solely at the behest of and
under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other
than public understanding of information that has been provided by CRS to Members of Congress in
connection with CRS’s institutional role. CRS Reports, as a work of the United States Government, are not
subject to copyright protection in the United States. Any CRS Report may be reproduced and distributed in
its entirety without permission from CRS. However, as a CRS Report may include copyrighted images or
material from a third party, you may need to obtain the permission of the copyright holder if you wish to
copy or otherwise use copyrighted material.


44 Government Accountability Office, Guide Missile Frigate[:] Navy Has Taken Steps to Reduce Acquisition Risk, but
Opportunities Exist to Improve Knowledge for Decision Makers
, GAO-19-512, August 2019 (revised September 5,
2019 to include an omitted page in the report section, [and] comments from the Department of Defense), pp. 44-45.
Congressional Research Service
R44972 · VERSION 114 · UPDATED
28