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As the Navy builds the last of its Nimitz-class carriers, it asked RAND to study the trade-offs involved in accelerating the production of its new CVN 21 carrier while hastening the retirement of some of the Nimitz fleet. What are the trade-offs involved in terms of cost, capability, and fleet size? RAND researchers looked at the Navy’s existing plan and compared it with several alternatives and discovered that the Navy could modernize its fleet with the higher-performance, lower-cost CVN 21 at a cost premium no greater than 12 percent over its current plan. Allowing for the CVN 21’s greater capability might permit the Navy to justify a smaller fleet size while it modernizes, and aggressive cost-cutting moves could reduce the cost premium significantly. The authors find no industrial base impediments to accelerating the program and conclude that the importance the Navy attaches to the increased fleet value premium should determine whether the increased cost is a good investment.

The research described in this report was prepared for the United States Navy. The research was conducted in the RAND National Defense Research Institute, a federally funded research and development center supported by the Office of the Secretary of Defense, the Joint Staff, the unified commands, and the defense agencies.

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