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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsNavy: Carrier cost overruns may hit $1.1 billion,may put the company's $579.2 million profit at risk
Navy: Carrier cost overruns may hit $1.1 billion
The Navy has estimated a worst-case cost overrun of as much as $1.1 billion for the aircraft carrier Gerald R. Ford, the service's most expensive warship.
The carrier is being built in Newport News by Huntington Ingalls Industries under a cost-plus, incentive-fee contract in which the Navy pays for most of the overruns. Even so, the service's efforts to control expenses may put the company's $579.2 million profit at risk, according to the Navy.
A review of the carrier's rising costs began in August after the Navy's program manager indicated that the "most likely" overrun had risen to $884.7 million, or about 17 percent over the contract's target price of $5.16 billion. That's up from a $650 million overrun estimated in April, according to internal Navy figures made available to Bloomberg News. The worst-case assessment would be about 21 percent over the target.
"Regular reviews of the cost performance indicated cost increases were occurring," Capt. Cate Mueller, a Navy spokeswoman, said in a statement.
http://hamptonroads.com/2012/01/navy-carrier-cost-overruns-may-hit-11-billion
Angry Dragon
(36,693 posts)Old and In the Way
(37,540 posts)that fly off their decks.
msongs
(67,478 posts)hay rick
(7,656 posts)Twice the loss, 2% of the coverage. It's good to be a part of the media-shielded military/industrial complex.
bahrbearian
(13,466 posts)Sarcasm.