LCS costs fall from 1st order, still top target

[unhappycamper]

The littoral combat ship Freedom moves through the Atlantic Ocean in September. The LCS 3 and 4 will cost less than predecessors Freedom and Independence but still will exceed congressional targets.


LCS costs fall from 1st order, still top target
By Christopher P. Cavas - Staff writer
Posted : Thursday Dec 3, 2009 14:05:47 EST

New cost figures just revealed by the Navy show that contract prices for the second pair of Littoral Combat Ships are far higher than a congressional target, but lower than the first pair of ships. And while the new figures provide more insight into a program where the first pair of ships tripled its initial budget, the convoluted nature of how the second pair is being accounted for may reduce the significance of the contract price.

The contracts for the second pair, LCS 3 and LCS 4, were awarded last spring to Lockheed Martin and General Dynamics, respectively. The prices were kept hidden, the Navy said, because of Pentagon acquisition rules governing the service’s plan to acquire an unspecified number of each of the competing designs. But the strictures were lifted in September when Navy acquisition chief Sean Stackley changed the plan to a winner-take-all strategy.

The contract for LCS 3, awarded March 23 to Lockheed Martin, is for $470,854,144, according to a Naval Sea Systems press release issued Dec. 3. The ship reuses certain materials from an earlier LCS 3 canceled in April 2007. Those materials, valued at $78 million, bring the contract value to $548,854,144.

For LCS 4, awarded May 1 to General Dynamics, the contract price is $433,686,769. Taken together with $114 million of materials from an earlier LCS 4 canceled in November 2007, the contract value is $547,686,769.

Those numbers contrast with the original $220 million-per ship cost forecast by the Navy in 2004, and a congressionally imposed cost cap of $460 million per ship to take effect with the fiscal 2011 budget.


Rest of article at: http://www.navytimes.com/news/2009/12/navy_lcs_ship_costs_120309w/



unhappycamper comment: The delivered cost for LCS 2 was $704 million dollars.