Cost big factor in decision to sack Navy warship

Growing costs and vulnerability to anti-ship missiles sank the Navy's once-heralded "stealth destroyer," a highly advanced warship designed to slip close to the shore unnoticed and pummel targets with big guns boasting pinpoint accuracy.

Faced with cost estimates upward of $5 billion per ship, the Navy had no choice but to let its prized Zumwalt destroyer program end after the first two ships are built, analysts said Wednesday.

Congressional investigators long had been concerned that the Navy tried to incorporate too many new technologies on an untested platform. The originally envisioned 32 ships dipped to 12 and then seven as costs grew.

"I don't think this thing was a shock because fundamentally the whole program was a big fat target for many years," said Jay Korman, defense analyst at The Avascent Group.

Sen. Susan Collins, a member of the Armed Services Committee, said Wednesday after additional briefings that the Navy plans to build nine more of its current Arleigh Burke destroyers, possibly with some added capabilities that went into the newer warship.

After talking with Bath Iron Works president Dugan Shipway, Collins said the General Dynamics subsidiary on the Maine coast would need to build seven of those nine ships to make up for the loss of the Zumwalt program. Instead, she said the Navy has promised only that a "majority" of the ships will go to Bath, which is building one of the two Zumwalt DDG-1000 destroyers.

That sets the stage for a battle between the Maine and Mississippi congressional delegations for the additional Burke ships.

"I'm going to do everything in my power to get a good outcome for the skilled workers at Bath Iron Works. They're my top priority," said Collins, R-Maine.

Northrop Grumman's Ingalls shipyard in Mississippi will build the second Zumwalt destroyer.

Wall Street didn't seem alarmed by the decision. General Dynamics shares rose by $5.82 to close at $89.27 on the New York Stock Exchange after the company reported higher earnings; Northrop Grumman closed at $68.12, up $1.41.

The DDG-1000's growing cost came as the Navy is trying to expand to a 313-ship fleet. Officially, the ships are to cost roughly double the $1.3 billion price of a Burke destroyer. But estimates for the first two run as high as $5 billion.

Loren Thompson, an defense analyst with the Lexington Institute, said the Navy can't afford the DDG-1000 but it can't afford to stop building ships, either, if it wants to achieve its shipbuilding goals and maintain a shipbuilding infrastructure.

Another problem with the DDG-1000 design was its potential vulnerability. Bombarding the shore with guns is cheaper than using missiles, but the ship would be vulnerable to attack if it came within 100 miles of shore to use its 155-millimeter guns, Thompson said.

"The Navy should have understood a long time ago that putting a $3 billion destroyer off the coast of a hostile country so that it could use gunfire was a dangerous proposition," he said.

Finally, there was no known threat to justify the warship.

Winslow Wheeler from the Center for Defense Information said the ship's demise was because of "cost, complexity and irrelevance."

"Please tell me what this thing would do today, if it were available in Iraq or Afghanistan?" the defense analyst said. "Talk about something that's totally out of control. This thing is a national embarrassment, that's what it is."

For years, it has been one of the Navy's prized programs. It has a low profile and composites in its superstructure for stealth. It also features a form of electric drive propulsion, new combat systems and a new hull form.

Displacing about 14,500 tons, the ship is 50 percent larger than a Burke destroyer but will have half the crew thanks to automated systems.

"I still believe that the ship offers capabilities that the Navy lacks and needs, but it's up to the Navy to determine its military requirement," Collins said.

Neither shipyard had been officially briefed as of Wednesday. The Navy had no official comment on its plans, either for scrapping the Zumwalt program or for building additional Burke destroyers.

"One thing is for sure, we stand ready to build it, whatever it is," Nicholas Chabraja, General Dynamics' chief executive, said Wednesday in a conference call.

Northrop Grumman expressed a similar sentiment.

"We are positioned to support the U.S. Navy to execute the shipbuilding plan which they identify as best meeting their operational requirements and addressing the needs of our nation," spokeswoman Jerri Dickseski said in a statement.

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AP writers Donna Borak and Stephen Manning in Washington contributed to this story.