- How do the fiscal challenges experienced by the U.S. government affect the Department of Defense, namely the U.S. Navy's ability to complete surface ship maintenance and operations?
- How do the near-term reductions in Operations and Maintenance accounts affect long-term U.S. Navy fleet readiness, specifically Operational Availability and expected service life?
- Is there a maintenance requirement concept for each ship class that supports expect service life but allows for some risk within the maintenance strategy?
- What are potential strategies to minimize negative effects to Operational Availability and expect service life while maintaining the largest, most capable fleet possible?
The Department of Defense is likely to face years of declining resources as the U.S. government grapples with fiscal challenges. These challenges affect every account, including those associated with surface ship maintenance and operations. At the same time, there has been widespread concern that surface ship materiel readiness is declining due to a high pace of operations and a sense that there have been many instances of deferred maintenance. The need to balance fiscal reality and a continued need for ready ships is likely to be an ongoing challenge. At the request of the Assessment Division of the Office of the Chief of Naval Operations, this report: (1) determines the impact on long-term fleet readiness, Operational Availability (Ao), and Expected Service Life (ESL) caused by near-term reductions in Operations and Maintenance (O&M) accounts; (2) recommends potential strategies to minimize negative impacts to Ao and ESL and maintain the largest, most capable fleet possible; (3) develops a maintenance requirement concept, per ship class, that supports ESL, but allows for some risk within the maintenance strategy; and (4) defines the risks to Ao and ESL resulting from the new requirement. The methodology could be applicable to multiple ship classes.
Since the Late 1990s, Expenditures per Ship Are Growing at an Increasing Rate
- This fact runs parallel to the legislative environment, which impact available resources. Annual shortfalls now amount to $8 billion between requested budget and legislatively authorized possible if legislation does not change.
- Pressure on maintenance budgets is expected to grow as the effects of sequestration are felt, with no expected diminishment in the demand for naval forces.
- Even absent sequestration, continued growth in per-ship maintenance cost is likely unsustainable, at least at the rate seen in the last 15 years. At the rate seen, maintenance would either become a larger component of the operations and management budget or come at the expense of new construction or modernization or require deferral.
A Study of the DDG-51 Class Shows the Mismatch Between Navy's Claims for Maintenance and What Is Spent
- A comparison between the cumulative maintenance levels for the DDG-51 and the levels specified in the Navy's technical foundation papers showed that the Navy is not in general funding to the level as stated in the technical foundation papers.
- This casts doubt on the validity of the technical foundation papers' requirements and the Navy's commitment to carrying out the maintenance stated in these published papers.
- Given this, the Navy will need to consider alternatives to the technical foundation papers' process as it formulates requirements and source plans.
Deferred Maintenance of Ships Affected by Individual History of Ships
- Ships of similar age and operating histories whose major difference is basing histories — with the attendant effects on maintenance — can show dramatic differences between the overall costs to maintain.
- Maintenance deferrals exact an extremely high premium that drives ship cost up in ways inconsistent with the need to contain costs.
- Any maintenance construct needs to understand and budget for the high cost of deferral or devise mitigations for cases where deferral is inevitable.
This report recommends actions the Navy can take to address surface ship maintenance and operations requirements in the context of fiscal constraints.
- A maintenance strategy that prioritizes selected restricted availabilities (SRAs), which are relatively lengthy and well funded, but the time and money available for maintenance in SRAs is limited. Maintenance priorities within SRAs are assigned based on safety concerns, the predictability of failures, the consequences of failures, and the future cost of deferring maintenance.
- If the maintenance required is relatively straightforward, and can be conducted with available personnel or can be broken down into manageable segments, then a continuous maintenance availability can provide an efficient and cost-effective alternative to an SRA.
Table of Contents
Trends in Surface Ship Maintenance Expenditure: The Record to Date
The Fiscal Environment
Current Maintenance Strategies
Potential New Maintenance Strategies
Conclusions and Recommendations
Age and Reliability
Most Significant SWLINs for DDG-51