Eighteen months ago, Admiral Jonathan Greenert, then Chief of Naval Operations (CNO) for the U.S. Navy, told Congress that the Navy needs to grow to at least 308 ships by 2020 if it's to accomplish the missions it's being assigned today. At an increase of 8%, that would mean a sizable boost from today's fleet strength of just 285 ships.
And even that might not be enough. According to at least one Congressman, the Navy probably needs to double in size.
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That's the upshot of a new report just out of Scout Warrior, which cites "senior Navy leaders," including new CNO Adm. John Richardson, warning that the Navy's current complement of "ships, submarines, aircraft carriers, and amphibs is massively insufficient to meet the current demands of combatant commanders around the globe," in editor Kris Osborn's words. One Congressman goes so far as to warn that the fleet will be incapable of carrying out nearly half the missions it's assigned just a few years from now.
Here's the problem in a nutshell: By 2022, the Navy hopes to have "12 Aircraft Carriers, 97 Large Surface Combatants, 37 Small Surface Combatants, 48 Attack Submarines, 4 Ohio Missile Submarines, 14 Ballistic Missile Submarines, 34 Amphibious Assault Ships, 29 Logistics Force Ships, and 34 Support Vessels" in its fleet.
That sounds like a lot, but it translates to a usable fleet of only about 60 ships. This is because for every one warship on station, you need to have four more ships supporting it -- one heading home after being relieved, another coming to replace the ship currently on station, a third in port getting ready to go out, and a fourth undergoing major overhauls in dry dock.
Result: Take any given Navy's size, and divide by five.
Complicating matters further, while the Navy wants to grow in size, over the next five years it's on course to retire more ships than it builds. Retirements will be most prevalent among the expensive-to-replace Los Angeles-class submarine fleet, and among Ticonderoga-class cruisers. Additionally, the Marine Corps says it needs not just to replace retiring amphibious assault ships, but to grow the total number from 30 ships currently in service to about 50.
In short, we need a lot more ships, and we need them sooner rather than later.
How big could the Navy grow?
In 2010, an independent panel of experts recommended that the Senate Armed Services Committee fund a 346-ship navy -- 21% larger than the one we have today, but still far smaller in size than the 500-ship Navy prevalent during the Reagan administration. And that's not all. According to the chairman of the House Armed Services Committee's Seapower and Projection Forces Subcommittee, Congressman Randy Forbes, shrinkage in the fleet due to ship retirements could soon see the Navy incapable of carrying out half the missions the nation needs it to accomplish.
That implies that the Navy's increase to 346 ships, which it expects to make official in the 2018 budget request, is only a minimum. The Navy could need to double in size.
Can we afford to double the size of the Navy? And even if we can, who will build all these ships?
The answer depends greatly on what types of ships we're talking about. Three main classes of vessel are getting the most attention: Nuclear-powered submarines, surface combatants (frigates, destroyers, and cruisers), and amphibious assault ships (small aircraft carriers). Major military shipbuilders General Dynamics (NYSE:GD) and Huntington Ingalls (NYSE:HII) build the first two. Huntington Ingalls builds the small aircraft carriers, as well as the Navy's larger, nuclear-powered supercarriers.
I'm going to go out on a limb here and guess both General Dynamics and Huntington Ingalls would be happy to help out the Navy with any plan to build 100-plus new warships. The problem will be building them on a limited military budget. Even if frigates, submarines, and amphibious assault ships don't carry the $14 billion price tag of a Gerald R. Ford-class supercarrier, they're far from cheap. Your average amphib costs about $3.1 billion, a new Ohio-class ballistic missile submarine will set you back anywhere from $6 billion to $8 billion, and even frigates fetch more than $560 million apiece.
If the Navy really wants to get to 500-plus ships, it will probably need to put the purchase of capital ships on the shelf for a while, and move significantly downscale. Skipping a supercarrier purchase, for example, would permit the purchase of four of the Marine Corps' hoped-for amphibious assault ships instead -- or free up funds for 21 frigates. Fourteen billion dollars not spent on a supercarrier could also go a long way to financing the Navy's plans to build squadrons of robotic submarines and/or autonomous surface warships. (In fact, the Navy just christened one of the latter -- at a price of just $23 million.)
Granted, this would mean that money spent on expanding the Navy would be spread around more widely. A move to a larger Navy, emphasizing more-but-smaller warships, might be less lucrative for Huntington and General Dynamics. On the other hand, by introducing competition from Boeing (NYSE:BA), which has begun building robo-submarines, and Leidos (NYSE:LDOS), which built the Navy's new autonomous surface warship, and smaller shipbuilders such as Bollinger Shipyards, it might stretch taxpayer dollars further.
We'd get a bigger Navy -- and probably a cheaper Navy, too.
Rich Smith does not own shares of, nor is he short, any company named above. You can find him on Motley Fool CAPS, publicly pontificating under the handle TMFDitty, where he's currently ranked No. 306 out of more than 75,000 rated members.
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