The U.S. Navy’s Most Expensive Warships for 2014

What is the Navy spending billions on?

Aug 9, 2014 at 10:33AM

Zumwalt With Tug

The Zumwalt-class guided-missile destroyer DDG 1000 is floated out of dry dock at the General Dynamics Bath Iron Works shipyard. The ship, the first of three Zumwalt-class destroyers, will provide independent forward presence and deterrence, support special operations forces and operate as part of joint and combined expeditionary forces. Photo credit: U.S. Navy photo via General Dynamics. 

The United States has an impressive array of weapons systems, but it could be argued that none are as imposing as the U.S. Navy's warships. In fact, the U.S. often uses the deployment of these weapons as a "show of force" to intimidate would-be-aggressors into backing down -- and who wouldn't be intimidated by a veritable floating fortress in your backyard?

Unfortunately, these ships don't last forever, nor are they cheap. The good news is these ships typically take years to build, and provide their respective defense contractors with a healthy boost to their bottom line. So, let's take a look at the three most expensive Navy ships for 2014 and see why the Navy considers them essential to military operations.

3. LHA 6 America-Class Amphibious Assault Ship

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The amphibious assault ship America (LHA 6) returned to Ingalls Shipbuilding on Saturday, Nov. 9, 2013, following successful builder's sea trials in the Gulf of Mexico. Photo credit: Steve Blount via Huntington Ingalls Industries.

At nearly three football fields in length (844 feet), and 20 stories high from keel to the top of its deckhouse, Huntington Ingalls Industries' (NYSE:HII) LHA 6 is indeed a floating fortress. More importantly, the America comes with an impressive array of weapons, including (but not limited to), RAM launchers, .50 caliber machine guns, and a Phalanx Close-In Weapon System -- a rapid-fire, radar-guided gun, that can shoot down missiles, planes, and other ships.  The America can accommodate nine F-35Bs, four AH-1Z Viper Attack helicopters, 12 Mv-22 Ospreys, and a variety of other aircraft.

More importantly, this ship is an essential when it comes to transporting Marine Expeditionary Units and their equipment. In fact, it can carry up to 1,871 troops, in addition to its 1,204-person crew.  The Government Accountability Office's, or GAO, estimated program unit cost for this titan? $3.4 billion -- and while that might seem like a staggering number, it's still not as expensive as the next two vessels on this list.  

2. DDG 1000 Zumwalt-Class Destroyer

Artistic Zumwalt

An artist rendering of the Zumwalt class destroyer DDG 1000, a new class of multi-mission U.S. Navy surface combatant ship designed to operate as part of a joint maritime fleet, assisting Marine strike forces ashore as well as performing littoral, air and sub-surface warfare. Photo credit: U.S. Navy photo illustration.

With a length of 610 feet, and a beam of just over 80 feet, General Dynamics' (NYSE:GD) Bath Iron Works' DDG 1000 Zumwalt is the largest U.S. Navy destroyer ever built. However, because of its low radar profile -- courtesy of advanced technologies that, in part, allow it to ride low in the water -- the Zumwalt is actually stealthier than other warships.  This directly benefits its multi-mission role, which according to the GAO, is "to provide advanced capability for littoral operations and land-attack in support of forces ashore."  To put it simply, the Zumwalt provides near-shore support for land troops, and also helps dominate the water.

Speaking of dominating, the Zumwalt has a truly impressive array of weapons, including Advanced Gun Systems, Peripheral Vertical launch Systems, a number of missile systems, and a power plant that can produce 78 megawatts of electricity. This means the Zumwalt could be used for futuristic weapons like the Electromagnetic Railgun -- an extended range launcher that uses electricity to fire projectiles at 4,500-5,600 mph. More importantly, thanks to automation technologies, the Zumwalt can be crewed with 142 sailors. That's less than half of what's needed on traditional destroyers.  The GAO's estimated program unit cost for this stealth destroyer? $7.3 billion. Expensive, but not nearly as expensive as the last ship on this list.

1. Gerald R. Ford-Class Nuclear Aircraft Carrier (CVN 78)

Gerald R Ford

The aircraft carrier Pre-Commissioning Unit (PCU) Gerald R. Ford (CVN 78) is moved to Pier 3 at Newport News Shipbuilding. Photo credit: U.S. Navy photo via Huntington Ingalls Industries by Chris Oxley.

According to the Navy, aircraft carriers are the "centerpiece" of the U.S.' Naval forces, and are "the premier forward asset for crisis response and early decisive striking power in major combat operations."  In other words, aircraft carriers are the big guns -- both figuratively, and literally -- and Huntington Ingalls Industries' Gerald R. Ford is no exception.

It's 1,092 feet long, its beam is 134 feet high, its Flight Deck is 256 feet wide, and it has a crew of 4,539. More importantly, the Gerald R. Ford is the first new design for an aircraft carrier since the Nimitz, and it comes power-packed with new technology. This includes: an electromagnetic aircraft launch system, new reactor plants that increase electrical power generation, and there's more space for Flight Deck operations thanks to a decreased island.  Further, the Gerald R. Ford's weaponry includes the Evolved Sea Sparrow Missile, Rolling Airframe Missile, Phalanx Close-In Weapon System, and it can carry 75+ aircraft.  Clearly, this is one ship you don't want to mess with, and it comes with an equally daunting price: an estimated $12 billion per program unit cost, according to the GAO. 

Why this matters
The above three ships are definitely expensive, and they get even more expensive when you factor in the fact that the Navy intends to purchase more than just one. For example, the Navy ordered three America-class assault ships for an estimated total program cost of $10.1 billion;  three Zumwalt-class destroyers for an estimated total program cost of almost $22 billion;  and three Gerald R. Ford-class carriers for an estimated total program cost of $36 billion. 

However, each ship was designed to augment, or replace their ageing counterparts -- the America was designed to replace the USS Peleliu (LHA-5) of the Tarawa-class amphibious assault ships,  the Zumwalt was originally seen as a replacement for the Iowa-class battleships that were retired in the 1990's,  and the Gerald R. Ford is a replacement for the USS Enterprise (CVN 65). Consequently, each ship fills a vital role for the Navy.  

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Katie Spence has no position in any stocks mentioned. The Motley Fool owns shares of General Dynamics and Lockheed Martin. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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