Naval new ship construction cost analysis and trends
Holmgren, David J.
Harshman, Richard A.
Gates, William R.
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This thesis presents an analysis of the Ship Construction and Conversion, Navy, Appropriation cost estimates for the ship construction during the period 1960-1992. Emphasis is placed on four specific shipbuilding programs: Guided Missile Destroyer (DDG-51), Fleet Ballistic Submarine (Trident), Attack Submarine (SSN-688), and Guided Missile Cruiser (CG-47). These programs are analyzed to determine how competition/dual sourcing, contract type and the shipbuilding marketplace have influenced to actual costs of these ships. These programs are also compared for the period 1981-1992 to determine if there are any trends or consistency for all of the programs. The research concludes that the shipbuilding marketplace has a significant influence on actual construction costs of Navy ships. When there is limited commercial work available the shipbuilders may underbid contracts to remain in business. Competition in Navy shipbuilding does not necessarily results in cost savings due to the small number of ships produced and the limited number of competitive shipyards.
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